JUNK FAXING

On April 5, 2006, the Federal Communications Commission (the Commission or FCC) adopted an order that amended the Commission’s rules on the Junk Fax Prevention Act of 2005.  Specifically, the order:

·        Forms an established business relationship (EBR) exemption to the prohibition of sending unsolicited facsimile advertisements;

·        Requires the sender of fax advertisements to provide clear and conspicuous notice and contact information on the first page of a fax that allows recipients to “opt-out” of future transmissions; and

·        Requires senders to honor opt-out requests within 30 days from the date that the recipient makes the request.

 
INFORMATION SECURITY
Two bills addressing the prevention and mitigation of damage of identity theft are before Congress. The impetus behind H.R. 4127, the Data Accountability and Trust Act (DATA) and S. 1789, the Personal Data Privacy and Security Act of 2005 Congressional findings indicating that databases of personal identifiable information are increasingly prime targets of hackers, identity thieves, rogue employees, and other criminals. The Senate bill only requires businesses having electronic or digital records containing the personally identifiable information of 10,000 or more individuals to have a security program. The House bill, by contrast, requires any person or business engaged in interstate commerce to implement a program.
 
Regarding implantation of such initiatives, any business that violates this section of the Senate bill by not having a security plan can be penalized not more than $5,000 per violation per day, up to a maximum of $500,000 per violation. Under both the House and Senate bills, any business entity engaged in interstate commerce, regardless of the number of electronic records it maintains, must conduct notifications following the discovery of a security breach.
Under both bills, notification must be made to each individual affected. Both bills require the notification to include a description of the personal information improperly acquired, a toll-free number individuals can call for more information on the breach, and toll-free numbers for the major credit reporting agencies. Under the Senate bill’s scheme, any business entity that does not notify in accordance may be fined $1,000 per day per individual affected up to a maximum of $50,000 per person and/or receive an injunction. If the business entity intentionally and willfully conceals the fact of a security breach and that breach causes economic damage to at least one person, they may be fined or imprisoned not more than 5 years or both. Under the House bill, violations are handled as unfair or deceptive acts or practices under the Federal Trade Commission Act of 1914.
 
HEALTHCARE TECHNOLOGY

On May 24, 2006, the House Ways and Means Subcommittee on Health advanced  H.R. 4157, the Health Information Technology Promotion Act of 2006. The legislation, designed to expedite the use of health information technology (IT), passed the subcommittee on an 8 to 5 party-line vote. Key provisions of H.R. 4157 include the following:

National Health IT Office—Assembled the Office of the National Coordinator for Health Information Technology in statute and clearly depicts its ongoing roles and responsibilities. The main role of the office will be to oversee the strategic plan to guide the nationwide implementation of interoperable standards for health information technology to improve health care quality.

Stark/Anti-Kickback Safe Harbors—The bill includes statutory safe harbors in physician self-referral (“Stark laws”) and anti-kickback laws that allow entities, including hospitals and group practices, to provide physicians with hardware, software, or related services that are used for electronic creation, maintenance, and exchange of clinical health information.

Uniform Privacy/Security Standards—H.R. 4157 requires the Secretary of Health and Human Services (HHS) to conduct a study on the effects of variation in state security and confidentiality laws and federal security and confidentiality standards. The Secretary must report back to Congress within 18 months with determinations on whether state and federal security and confidentiality laws need to be made more consistent to strengthen the security and confidentiality of individually identifiable health information, and, if so, how such laws and standards should be conformed. If Congress does not enact legislation 18 months after receipt of the study, the Secretary has the authority, but is not required, to modify federal security and confidentiality standards and limit state security and confidentiality laws.

Modern Coding System—The bill requires the Secretary of HHS to adopt the updated Health Insurance Portability and Accountability Act (HIPAA) transaction standard for medical transactions occurring on or after April 1, 2009. The standard applies to claims transactions.

Implementation of Health IT—H.R. 4157 requires the Secretary of HHS to develop a strategic plan to coordinate implementation efforts for health IT standards, HIPAA transaction standards, and new coding systems.

Proponents of health IT are hopeful the bill will be scheduled for House floor consideration in late June, when the House plans to address several health care bills during “Health Week.”

HEALTHCARE SPENDING ACCOUNTS
On May 2, 2006, H.R. 5262 was introduced, the Tax Free Health Savings Act of 2006. This legislation, designed to make Health Savings Accounts (HSAs) more attractive to consumers and businesses. Employers have pointed to a number of improvements that could be made to HSAs to make them more attractive to employers and employees, some of which are included in H.R. 5262.
 

Key provisions of interest to HR professionals include the following:

·        Increased Contributions for Chronically Ill Employees—Would allow employers to make greater contributions to the HSAs of chronically ill employees.

·        Flexibility in Coordinating FSAs, HRAs, and HSAs—Would allow for the coordination of FSAs, HRAs, and HSAs for five years. At any time during the five-year period, an individual may choose to roll-over the FSA and/or HRA into their HSA, thereby ending their ability to coordinate plans.

·        Allow HSA Dollars to Pay for Premiums for Early Retirees—Would allow early retirees to use HSA funds to pay for premiums for HSA-compatible coverage.

 
EMPLOYMENT

May 25, 2006, the Senate, by a vote of 62 to 36, passed S. 2611, the Comprehensive Immigration Reform Act of 2006. With this action, the Senate joins the House in passing immigration reform legislation. While the House bill, H.R. 4437, the Border Protection, Antiterrorism, and Illegal Immigration Control Act of 2005, is focused on border security and interior enforcement, the Senate bill includes similar provisions but also has a guest worker program and employment-based “skilled worker” provisions. Congress must now attempt to reconcile the differences between the Senate and House versions of the legislation in a conference committee, which promises to be a difficult process at best. Provisions are outlined below.

·        Electronic Verification System for Employment Purposes—Both bills would create an electronic verification system for employment.

·        Secondary Verification System for Employment Purposes—Both bills would establish a secondary verification process in the case of a tentative non-confirmation.

·        Re-verification of Existing Employees—Both bills would require employers to re-verify employees, but would vary in scope and application.

• House - H.R. 4437 would require all employers to re-verify the identity and employment eligibility of all previously hired employees using the electronic verification system.

• Senate - S. 2611 would apply the re-verification provisions to all critical infrastructure employers and employers with prior violations of the employer sanctions provisions.

·        Employer Attestation of Verification Process—Both bills would require an employer to continue to attest on Form I-9 or a similar document that he or she had examined the new hire’s employment and identification documents to ensure authenticity; Each bill requires that information retained for different periods of time.

·        Relationship with Subcontractors—Both bills would place new requirements on employers for their subcontractors’ hiring practices.

·        Good-Faith Reliance on System—Both bills would provide that employers, persons or entities that had taken any action in good-faith reliance on the basis of information provided through the electronic verification system would not be criminally or civilly liable for that action.

·        Increased Penalties—Both bills would increase civil penalties for recruiting, hiring, and referral violations.

·        Criminal Sanctions— Both bills provide for criminal penalties for recruiting, hiring, and referral violations.

·        Congressional Reports—Both bills would require various federal agencies to submit reports to Congress, but would vary in scope and requirements.

·        Visa Provisions—The legislation includes provisions that would make changes to the Visa program. HR 4437 makes no changes while S 2611 makes several changes to H1B Visa and Employment Based (EB) Immigrant Visas.

 

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