[Federal Register Volume 65, Number 151 (Friday, August 4, 2000)]
[Notices]
[Pages 48000-48003]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-18549]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Health Care Financing Administration


Privacy Act of 1974; Report of Modified or Altered System

AGENCY: Health Care Financing Administration (HCFA), Department of 
Health and Human Services (HHS).

ACTION: Notice of Modified or Altered System of Records (SOR).

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SUMMARY: In accordance with the requirements of the Privacy Act of 
1974, we are proposing to modify or alter a SOR, ``Explanation of 
Medicare Benefits Records (EOMB), HHS/HCFA/BPO, System No. 09-70-
0513.'' We are proposing to change the name of the SOR to ``Medicare 
Benefits Notices (MBN), HHS/HCFA/CBS, System No. 09-70-0513.'' We are 
also proposing to add one new routine use for contractors and 
consultants, update any sections of the SOR that were affected by the 
recent reorganization, and to update language in the administrative 
sections to correspond with language used in other HCFA SOR. The 
primary purpose of the SOR to provide an explanation of Medicare claims 
processed and to advise beneficiaries of supplemental insurance, 
deductible status, appeals information and general Medicare 
information. Information retrieved from this SOR will be used to 
support regulatory and policy functions performed within the agency or 
by a contractor or consultant, support constituent requests made to a 
congressional representative, and to support litigation involving the 
agency related to this SOR. We have provided background information 
about the proposed system in the ``Supplementary Information'' section 
below. Although the Privacy Act requires only that HCFA provide an 
opportunity for interested persons to comment on the proposed routine 
uses, HCFA invites comments on all portions of this notice. See 
``Effective Dates'' section for comment period.

EFFECTIVE DATES: HCFA filed a modified or altered system report with 
the Chair of the House Committee on Government Reform and Oversight, 
the Chair of the Senate Committee on Governmental Affairs, and the 
Administrator, Office of Information and Regulatory Affairs, Office of 
Management and Budget (OMB) on July 18, 2000. To ensure that all 
parties have adequate time in which to comment, the modified or altered 
SOR, including routine uses, will become effective 40 days from the 
publication of the notice, or from the date it was submitted to OMB and 
the Congress, whichever is later, unless HCFA receives comments that 
require alterations to this notice.

ADDRESSES: The public should address comments to: Director, Division of 
Data Liaison and Distribution (DDLD), HCFA, Room N2-04-27, 7500 
Security Boulevard, Baltimore, Maryland 21244-1850. Comments received 
will be available for review at this location, by appointment, during 
regular business hours, Monday through Friday from 9 a.m.-3 p.m., 
eastern time zone.

FOR FURTHER INFORMATION CONTACT: Maria Ramirez, Division of Contractor 
Customer Service Operations, Center for Beneficiary Services, HCFA, C2-
02-10, 7500 Security Boulevard, Baltimore, Maryland, 21244-1850. The 
telephone number is 410-786-1122.

SUPPLEMENTARY INFORMATION:

I. Description of the Modified SOR

Statutory and Regulatory Basis for SOR

    In 1981, HCFA established a SOR under the authority of sections 
205, 226, 1811, and 1832 of Title XVIII of the Social Security Act (42 
U.S.C. 405, 426, 1395c, and 1395k). Notice of this system, 
``Explanation of Medicare Benefits Records, (EOMB),'' HHS/HCFA/BPO, 
System No. 09-70-0513, was published in the Federal Register on October 
27, 1981 (46 FR 52706). These regulations established the requirement 
that an explanation of Medicare benefits be sent to beneficiaries 
advising them of Medicare benefits remaining, and whether the various 
deductible requirements have been satisfied.

II. Collection and Maintenance of Data in the System.

A. Scope of the Data Collected

    The system includes Medicare hospital insurance benefits records, 
Part B benefits records, home health benefits records, and Medicare 
hospital benefits records. These are notices of utilization and 
explanation of Medicare benefits. They also advise beneficiaries of 
supplementary insurance, deductible status, appeals information, and 
general Medicare information.

B. Agency Policies, Procedures, and Restrictions on the Routine Use

    The Privacy Act permits us to disclose information without an 
individual's consent if the information is to be used for a purpose 
that is compatible with the purpose(s) for which the information was 
collected. Any such disclosure of data is known as a ``routine use.'' 
The government will only release MBN information as provided for under 
``Section III. Entities Who May Receive Disclosures Under Routine 
Use.''
    We will only disclose the minimum personal data necessary to 
achieve the purpose of MBN. HCFA has the following policies and 
procedures concerning disclosures of information which will be 
maintained in the system. In general, disclosure of information from 
the SOR will be approved only for the minimum information necessary to 
accomplish the purpose of the disclosure after HCFA:
    (a) Determines that the use or disclosure is consistent with the 
reason that the data is being collected, e.g.,

[[Page 48001]]

provide an explanation of Medicare claims processed to beneficiaries.
    (b) Determines:
    (1) That the purpose for which the disclosure is to be made can 
only be accomplished if the record is provided in individually 
identifiable form;
    (2) That the purpose for which the disclosure is to be made is of 
sufficient importance to warrant the effect and/or risk on the privacy 
of the individual that additional exposure of the record might bring; 
and
    (3) That there is a strong probability that the proposed use of the 
data would in fact accomplish the stated purpose(s).
    (c) Requires the information recipient to:
    (1) Establish administrative, technical, and physical safeguards to 
prevent unauthorized use of disclosure of the record;
    (2) Remove or destroy at the earliest time all individual-
identifiable information; and
    (3) Agree to not use or disclose the information for any purpose 
other than the stated purpose under which the information was 
disclosed.
    (d) Determines that the data are valid and reliable.

III. Proposed Routine Use Disclosures of Data in the System

Entities Who May Receive Disclosures Under Routine Use

    These routine uses specify circumstances, in addition to those 
provided by statute in the Privacy Act of 1974, under which HCFA may 
release information from the MBN without the consent of the individual 
to whom such information pertains. Each proposed disclosure of 
information under these routine uses will be evaluated to ensure that 
the disclosure is legally permissible, including but not limited to 
ensuring that the purpose of the disclosure is compatible with the 
purpose for which the information was collected. In addition, our 
policy will be to prohibit release even of non-identifiable data, 
except pursuant to one of the routine uses, if there is a possibility 
that an individual can be identified through implicit deduction based 
on small cell sizes (instances where the patient population is so small 
that individuals who are familiar with the enrollees could, because of 
the small size, use this information to deduce the identity of the 
beneficiary). We are proposing to establish the following routine use 
disclosures of information maintained in the system:
    1. To agency contractors, or consultants who have been engaged by 
the agency to assist in the performance of a service related to this 
system of records and who need to have access to the records in order 
to perform the activity.
    We contemplate disclosing information under this routine use only 
in situations in which HCFA may enter into a contractual or similar 
agreement with a third party to assist in accomplishing HCFA functions 
relating to purposes for this SOR.
    HCFA occasionally contracts out certain of its functions when this 
would contribute to effective and efficient operations. HCFA must be 
able to give contractors or consultants whatever information is 
necessary for the contractor or consultant to fulfill its duties. In 
these situations, safeguards are provided in the contract prohibiting 
the contractor or consultant from using or disclosing the information 
for any purpose other than that described in the contract and to return 
or destroy all information at the completion of the contract.
    2. To a Member of Congress or to a congressional staff member in 
response to an inquiry of the congressional office made at the written 
request of the constituent about whom the record is maintained.
    Beneficiaries sometimes request the help of a Member of Congress in 
resolving an issue relating to a matter before HCFA. The Member of 
Congress then writes HCFA, and HCFA must be able to give sufficient 
information to be responsive to the inquiry.
    3. To the Department of Justice (DOJ), court or adjudicatory body 
when:
    (a) The agency or any component thereof, or
    (b) Any employee of the agency in his or her official capacity, or
    (c) Any employee of the agency in his or her individual capacity 
where the DOJ has agreed to represent the employee, or
    (d) The United States Government is a party to litigation or has an 
interest in such litigation, and by careful review, HCFA determines 
that the records are both relevant and necessary to the litigation and 
that the use of such records by the DOJ, court or adjudicatory body is 
compatible with the purpose for which the agency collected the records.
    Whenever HCFA is involved in litigation, and occasionally when 
another party is involved in litigation and HCFA's policies or 
operations could be affected by the outcome of the litigation, HCFA 
would be able to disclose information to the DOJ, court or adjudicatory 
body involved.

IV. Safeguards

A. Authorized Users

    Personnel having access to the system have been trained in Privacy 
Act requirements. Employees who maintain records in the system are 
instructed not to release any data until the intended recipient agrees 
to implement appropriate administrative, technical, procedural, and 
physical safeguards sufficient to protect the confidentiality of the 
data and to prevent unauthorized access to the data. Records are used 
in a designated work area or work station and the system location is 
attended at all times during working hours.
    To ensure security of the data, the proper level of class user is 
assigned for each individual user. This prevents unauthorized users 
from accessing and modifying critical data. The system database 
configuration includes five classes of database users:
     Database Administrator class owns the database objects, 
e.g., tables, triggers, indexes, stored procedures, packages, and has 
database administration privileges to these objects;
     Quality Control Administrator class has read and write 
access to key fields in the database;
     Quality Indicator (QI) Report Generator class has read-
only access to all fields and tables;
     Policy Research class has query access to tables, but are 
not allowed to access confidential patient identification information; 
and
     Submitter class has read and write access to database 
objects, but no database administration privileges.

B. Physical Safeguards

    All server sites have implemented the following minimum 
requirements to assist in reducing the exposure of computer equipment 
and thus achieve an optimum level of protection and security for the 
MBN system:
    Access to all servers is controlled, with access limited to only 
those support personnel with a demonstrated need for access. Servers 
are to be kept in a locked room accessible only by specified management 
and system support personnel. Each server requires a specific log-on 
process. All entrance doors are identified and marked. A log is kept of 
all personnel who were issued a security card, key and/or combination 
which grants access to the room housing the server, and all visitors 
are escorted while in this room. All servers are housed in an area 
where appropriate environmental security controls are implemented, 
which include measures implemented to mitigate damage to Automated 
Information System (AIS)

[[Page 48002]]

resources caused by fire, electricity, water and inadequate climate 
controls.
    Protection applied to the workstations, servers and databases 
include:
     User Log-ons--Authentication is performed by the Primary 
Domain Controller/Backup Domain Controller of the log-on domain.
     Workstation Names--Workstation naming conventions may be 
defined and implemented at the agency level.
     Hours of Operation--May be restricted by Windows NT. When 
activated all applicable processes will automatically shut down at a 
specific time and not be permitted to resume until the predetermined 
time. The appropriate hours of operation are determined and implemented 
at the agency level.
     Inactivity Log-out--Access to the NT workstation is 
automatically logged-out after a specified period of inactivity.
     Warnings--Legal notices and security warnings display on 
all servers and workstations.
     Remote Access Security (RAS)--Windows NT RAS security 
handles resource access control. Access to NT resources is controlled 
for remote users in the same manner as local users, by utilizing 
Windows NT file and sharing permissions. Dial-in access can be granted 
or restricted on a user-by-user basis through the Windows NT RAS 
administration tool.
    There are several levels of security found in the MBN system. 
Windows NT provides much of the overall system security. The Windows NT 
security model is designed to meet the C2-level criteria as defined by 
the U.S. Department of Defense's Trusted Computer System Evaluation 
Criteria document (DoD 5200.28-STD, December 1985). Netscape Enterprise 
Server is the security mechanism for all MBN transmission connections 
to the system. As a result, Netscape controls all MBN information 
access requests. Anti-virus software is applied at both the workstation 
and NT server levels.
    Access to different areas on the Windows NT server is maintained 
through the use of file, directory and share level permissions. These 
different levels of access control provide security that is managed at 
the user and group level within the NT domain. The file and directory 
level access controls rely on the presence of an NT File System (NTFS) 
hard drive partition. This provides the most robust security and is 
tied directly to the file system. Windows NT security is applied at 
both the workstation and NT server levels.

C. Procedural Safeguards

    All automated systems must comply with Federal laws, guidance, and 
policies for information systems security. These include, but are not 
limited to: the Privacy Act of 1974, the Computer Security Act of 1987, 
OMB Circular A-130, revised, Information Resource Management (IRM) 
Circular #10, HHS Automated Information Systems Security Program, the 
HCFA Information Systems Security Policy and Program Handbook, and 
other HCFA systems security policies. Each automated information system 
should ensure a level of security commensurate with the level of 
sensitivity of the data, risk, and magnitude of the harm that may 
result from the loss, misuse, disclosure, or modification of the 
information contained in the system.

V. Effect of the Proposed SOR on Individual Rights

    HCFA proposes to establish this system in accordance with the 
principles and requirements of the Privacy Act and will collect, use, 
and disseminate information only as prescribed therein. Data in this 
system will be subject to the authorized releases in accordance with 
the routine uses identified in this SOR.
    HCFA will monitor the collection and reporting of MBN data. HCFA 
will take precautionary measures (see item IV. above) to minimize the 
risks of unauthorized access to the records and the potential harm to 
individual privacy or other personal or property rights. HCFA will 
collect only that information necessary to perform the system's 
functions. In addition, HCFA will make disclosure from the proposed 
system only with consent of the subject individual, or his/her legal 
representative, or in accordance with an applicable exception provision 
of the Privacy Act.
    HCFA, therefore, does not anticipate an unfavorable effect on 
individual privacy as a result of the disclosure of information 
relating to individuals.

    Dated: July 7, 2000.
Nancy-Ann Min DeParle,
Administrator, Health Care Financing Administration.
  

SYSTEM NAME:
    Medicare Benefits Notices (MBN), HHS/HCFA/CBS.

SECURITY CLASSIFICATION:
    Level Three Privacy Act Sensitive Data.

SYSTEM LOCATION:
    HCFA Data Center, 7500 Security Boulevard, North Building, First 
Floor, Baltimore, Maryland 21244-1850, and Medicare intermediaries and 
carriers and agents at various locations.

CATEGORIES OF INDIVIDUALS COVERED BY THE SYSTEM:
    All recipients of Medicare Part A and Part B services and supplies.

CATEGORIES OF RECORDS IN THE SYSTEM:
    The system includes the following information for each beneficiary: 
Name; address; health insurance claims number (HIC); dates of service; 
and the contractor assigned claim control number.

AUTHORITY FOR MAINTENANCE OF THE SYSTEM:
    Sections 205, 226, 1811, and 1832 of Title XVIII of the Social 
Security Act (42 USC 405, 426, 1395c, and 1395k).

PURPOSE(S):
    The primary purpose of the system of records is to provide an 
explanation of Medicare claims processed and to advise beneficiaries of 
supplemental insurance, deductible status, appeals information and 
general Medicare information. Information retrieved from this system of 
records will be used to support regulatory and policy functions 
performed within the agency or by a contractor or consultant, support 
constituent requests made to a congressional representative, and to 
support litigation involving the agency related to this system of 
records.

ROUTINE USES OF RECORDS MAINTAINED IN THE SYSTEM, INCLUDING CATEGORIES 
OR USERS AND THE PURPOSES OF SUCH USES:
    The Privacy Act allows us to disclose information without an 
individual's consent if the information is to be used for a purpose 
that is compatible with the purpose(s) for which the information was 
collected. Any such compatible use of data is known as a ``routine 
use.'' The proposed routine use in this system meets the compatibility 
requirement of the Privacy Act. We are proposing to establish the 
following routine use disclosures of information that will be 
maintained in the system:
    1. To agency contractors, or consultants who have been engaged by 
the agency to assist in the performance of a service related to this 
system of records and who need to have access to the records in order 
to perform the activity.
    2. To a Member of Congress or to a congressional staff member in 
response to an inquiry of the congressional office made at the written 
request of the

[[Page 48003]]

constituent about whom the record is maintained.
    3. To the Department of Justice (DOJ), court or adjudicatory body 
when:
    (a) The agency or any component thereof, or
    (b) Any employee of the agency in his or her official capacity, or
    (c) Any employee of the agency in his or her individual capacity 
where the DOJ has agreed to represent the employee, or
    (d) The United States Government is a party to litigation or has an 
interest in such litigation, and by careful review, HCFA determines 
that the records are both relevant and necessary to the litigation and 
that the use of such records by the DOJ, court or adjudicatory body is 
compatible with the purpose for which the agency collected the records.

POLICIES AND PRACTICES FOR STORING, RETRIEVING, ACCESSING, RETAINING, 
AND DISPOSING OF RECORDS IN THE SYSTEM:
STORAGE:
    Computer diskette and on magnetic storage media.

RETRIEVABILITY:
    Information can be retrieved by the beneficiary's health insurance 
claims number or a contractor assigned claim control number.

SAFEGUARDS:
    HCFA has safeguards for authorized users and monitors such users to 
ensure against excessive or unauthorized use. Personnel having access 
to the system have been trained in the Privacy Act and systems security 
requirements. Employees who maintain records in the system are 
instructed not to release any data until the intended recipient agrees 
to implement appropriate administrative, technical, procedural, and 
physical safeguards sufficient to protect the confidentiality of the 
data and to prevent unauthorized access to the data.
    In addition, HCFA has physical safeguards in place to reduce the 
exposure of computer equipment and thus achieve an optimum level of 
protection and security for the MBN system. For computerized records, 
safeguards have been established in accordance with HHS standards and 
National Institute of Standards and Technology guidelines, e.g., 
security codes will be used, limiting access to authorized personnel. 
System securities are established in accordance with HHS, Information 
Resource Management (IRM) Circular #10, Automated Information Systems 
Security Program; HCFA Automated Information Systems (AIS) Guide, 
Systems Securities Policies, and OMB Circular No. A-130 (revised), 
Appendix III.

RETENTION AND DISPOSAL:
    Records are maintained in a secure storage area with identifiers. 
Records are placed in an inactive status at the close of the calendar 
year in which the benefit was paid, held two more years, transferred to 
a federal records center and destroyed after another six years.

SYSTEM MANAGER:
    Director, Division of Contractor Customer Service Operations, 
Center for Beneficiary Services, HCFA, C2-26-21, 7500 Security 
Boulevard, Baltimore, Maryland, 21244-1850. The telephone number is 
410-786-2133.

NOTIFICATION PROCEDURE:
    For purpose of access, the subject individual should write to the 
system manager who will require the system name, health insurance claim 
number, address, date of birth and sex, and for verification purposes, 
the subject individual's name (woman's maiden name, if applicable) and 
social security number (SSN). Furnishing the SSN is voluntary, but it 
may make searching for a record easier and prevent delay.

RECORD ACCESS PROCEDURE:
    For purpose of access, use the same procedures outlined in 
Notification Procedures above. Requestors should also reasonably 
specify the record contents being sought. (These procedures are in 
accordance with Department regulation 45 CFR 5b.5(a)(2)).

CONTESTING RECORD PROCEDURES:
    The subject individual should contact the system manager named 
above, and reasonably identify the record and specify the information 
to be contested. State the corrective action sought and the reasons for 
the correction with supporting justification. (These procedures are in 
accordance with Department regulation 45 CFR 5b.7).

RECORD SOURCE CATEGORIES:
    Sources of information contained in this records system are 
provided by the beneficiary when applying for benefits or requesting 
payment, the physician or provider of services when requesting payment, 
and computations for amounts of payments and remaining benefits 
provided by the carriers and intermediaries.

SYSTEMS EXEMPTED FROM CERTAIN PROVISIONS OF THE ACT:
    None.
FR Doc. 00-18549 Filed 8-3-00; 8:45 am]
BILLING CODE 4120-03-P