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CMSS Joins 'Red Flags Rule' Lawsuit Against FTC

Cheryl Clark, for HealthLeaders Media, August 18, 2010

The Council of Medical Specialty Societies, which represents some 650,000 U.S. physician specialists in 34 societies, has announced its participation in a lawsuit to exempt doctors from requirements of the "Red Flags Rule" scheduled to take effect by year end.

Groups such as the American Medical Association object to the Federal Trade Commission's requirement for physicians to verify the true identity of their patients before they agree to treat them if the patients are not paying in full at the time of the visit. The intention of the requirement is to prevent potential cases of identity theft.

If a patient says he or she is someone else, the wrong person or entity would be billed for that individual's care.  But doctors say that requiring such proof of identity is time-consuming, awkward, and may delay care if the patient didn't bring proper documents.

The FTC has postponed implementation of the rule five times. It is now scheduled to go into effect Dec. 31.

The AMA, the American Osteopathic Association and the Medical Society of the District of Columbia filed a lawsuit this spring demanding the FTC exempt physicians from the rule. The effect of such identity verification covers the physician-patient relationship with a blanket of suspicion before treatment ever begins, they say. It also may require doctors to set up identity theft prevention and detection programs.

The Council of Medical Specialty Societies is joining in the lawsuit because the FTC "failed to follow the required notice and comment procedures under the Administrative Procedures Act."  It also said that imposition of the rule on doctors imposes significant burdens, "particularly (on) solo practitioners and those practicing in small groups."

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