President Obama has signed into law the "Red Flag Program Clarification Act of 2010." The new rules exempt health care providers, including speech-language pathology and audiology practices, which do not receive payment in full at the time of service. Under the old "Red Flag" law, health care providers were considered "creditors" if they did not require patients to pay for their services in full at the time of service. As creditors, health care providers would have been required to implement a policy to prevent identity theft by January 1, 2011. However, the new law clarifies the meaning of "creditor," limiting it to the following: Someone who 1) obtains or uses consumer reports in connection with a credit transaction, 2) furnishes information to consumer reporting agencies in connection with a credit transaction, or 3) advances funds to or on behalf of a person, based on an obligation to repay the funds. The most relevant section of the law clarifies the definition of "creditor" to exclude those who advance funds to a person for expenses incidental to a service provided to that person. Hence, the practices of speech-language pathologists and audiologists and other health care professionals would not be seen as creditors.
For further information, please contact Kate Romanow, ASHA's director of health care regulatory advocacy, at firstname.lastname@example.org or 800-498-2071, ext. 5671.