Tennessee Insurance Practice Exam

What does the Health Insurance Portability and Accountability Act (HIPAA) protect?

1. Insurance company profits

2. Worker's compensation claims

3. Privacy of health information

4. Employer liability

The correct answer is: Privacy of health information

The Health Insurance Portability and Accountability Act (HIPAA) primarily safeguards the privacy and security of individuals' health information. Enacted in 1996, HIPAA establishes national standards for the protection of medical records and other personal health information, ensuring that sensitive health data is kept confidential and secure from unauthorized access. This protection applies to healthcare providers, health plans, and healthcare clearinghouses that conduct electronic transactions, requiring them to implement appropriate safeguards to protect patient information. Additionally, HIPAA provides patients with rights over their health information, including the right to access their records and request corrections. In contrast, aspects such as insurance company profits, worker's compensation claims, and employer liability do not fall under HIPAA's objectives. While these matters are important in the broader context of healthcare and insurance, they are governed by different regulations and laws that are unrelated to the privacy and security protections that HIPAA is designed to ensure.