Physicians Sue To Avoid 'Red Flags' Rule

The American Medical Association and the American Osteopathic Association on Friday sued the Federal Trade Commission, trying to prevent the FTC from requiring physicians to comply with its new “Red Flags” rule to prevent identity theft.

The rule — to take effect June 1 — requires most “creditors,” including physicians’ offices, to develop and implement written identity theft prevention and detection programs to protect consumers from identity theft.

The physicians groups say such programs aren't necessary for physicians' offices and said the FTC was "arbitrary and capricious" in extending the application of the law to them, according to a report on the lawsuit at Health Leaders Media Online.

The rule would require physicians to verify patients’ true identities before they begin treating them, the physicians groups argue.

"The worst part is, I think, from a strictly ethical point of view, that you have to approach every new patient with suspicion about their identity," said AMA spokesman Robert Mills. "That violates every precept of the physician-patient relationship; the FTC is asking doctors to violate their role as trusted healer and counselor."

Mills said that healthcare providers are already bound by the Health Insurance Portability and Accountability Act, which requires patient information be kept confidential, and several other rules. "So why implement another unfunded mandate to keep medical information secure when it is already confidential?" he asked.

The American Bar Association was successful in its litigation to exempt attorneys from having to comply with the rule.

The AMA and several other health provider groups petitioned the FTC in March for a similar exemption, but were not successful.

"If lawyers are exempted, why are other professionals such as those in healthcare included?" Mills asked.

The Medical Society of the District of Columbia is also a plaintiff in the lawsuit. The case was filed in federal court in the District of Columbia.

The Red Flags Rule was originally slated to take effect in November of last year but its implementation was delayed after requests by members of Congress.