Doctors Speak Out About Red Flags Rule

Health professionals should not be bound under the new "Red Flags" rule, which "imposes an unjustified, unfunded mandate on health professionals for detecting and responding to identity theft," a group representing doctors, dentists, and veterinarians has told the Federal Trade Commission.

The American Dental Association, the American Medical Association, the American Osteopathic Association, and the American Veterinary Medical Association wrote a letter to Jon Leibowitz, chairman of the FTC, that their members should not be bound by the rule, especially subsequent to a recent court ruling.

The U.S. District Court for the District of Columbia recently ruled that lawyers should be excluded from the requirements imposed by the Red Flags rule, according to a statement from the AMA.

"The court decision follows wide criticism that the FTC's overly broad interpretation of the Fair and Accurate Credit Transactions Act of 2003 (FACT) led the commission to create a rule that oversteps its authority," the AMA said. "In response to these concerns, the FTC postponed the rule's effective date to June 1, but it has never changed the position that the rule will apply to health professionals."

AMA President J. James Rohack, MD, said in a prepared statement, "The court ruling sends a clear signal that the FTC needs to re-evaluate the broad application of the Red Flags rule. Our four organizations firmly believe that applying the rule to health professionals, but not to lawyers, would be unfair."

In their letter, the four health group leaders said, "Indeed, implementation of the rule with respect to LHCPs [licensed healthcare professionals] but not to lawyers would be manifestly unfair and anomalous."

According to the FTC Web site, the Red Flags rule requires businesses, including many doctors' offices, hospitals, and other healthcare providers, to develop a written program to spot the warning signs—or "red flags"—of identity theft.