The Administrative Simplification provisions of the Health Insurance
Portability and Accountability Act of 1996 (HIPAA, Title II) required
the Department of Health and Human Services (HHS) to establish national
standards for electronic health care transactions and national
identifiers for providers, health plans, and employers. It also
addressed the security and privacy of health data. As the industry
adopts these standards for the efficiency and effectiveness of the
nation's health care system will improve the use of electronic data
interchange.