In 1996 the Health Insurance Portability and Accountability Act (HIPAA) was enacted by the US Congress. The act is designed to protect health insurance coverage for employees and their families when they lose or change jobs. The Administrative Simplification (AS) provision calls for the establishment of national standards for electronic health care transactions and national identifiers for medical insurance plans, employers and providers. The provison encourages the use of electronic data exchange in the health care system. It is envisaged that this will improve the effectivenes and efficency of the system and also improve the privacy of health data.
In 1986 the Consolidated Omnibus Budget Reconciliation Act (COBRA) was passed by Congress. The act amends the Public Health Service Act, Employee Retirement Income Security Act and the Internal Revenue Code to provide for the continuation of group health coverage that might previously have been dicontinued COBRA allows former retirees, employees and their dependants the right to temporary continuation of medical coverage at group rates.