Medical groups challenge 'red flags' rule in U.S. court

A number of medical groups filed a lawsuit in a Washington D.C. court Friday seeking exemption from the Federal Trade Commission's rule regarding identity theft regulations.

The FCC's “red flags” rule requires any institution that could be considered a creditor to implement stringent anti-identity theft provisions. Physicians, nursing homes and other healthcare facilities could fall into this category since they routinely provide services for which they are reimbursed at a later date. Late in 2009, the U.S. District Court for the District of Columbia ruled that application of the rule to another professional group, attorneys, is “erroneous” and “inconsistent.” (McKnight's, 2/3/10)

The American Medical Association, the American Osteopathic Association and the Medical Society of the District of Columbia filed a complaint Friday with the U.S. District Court for the District of Columbia. The groups charge that the FTC's rule “exceeds the powers delegated to it by Congress and that its application to physicians is arbitrary, capricious and contrary to the law.”