Health Insurance Portability and Accountability Act (HIPAA) Privacy Rule and the National Instant Criminal Background Check System (NICS), 382-396 [2015-33181]

Agencies

• DEPARTMENT OF HEALTH AND HUMAN SERVICES
• Office of the Secretary

[Federal Register Volume 81, Number 3 (Wednesday, January 6, 2016)]
[Rules and Regulations]
[Pages 382-396]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-33181]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Office of the Secretary

45 CFR Part 164


Health Insurance Portability and Accountability Act (HIPAA) 
Privacy Rule and the National Instant Criminal Background Check System 
(NICS)

AGENCY: Office for Civil Rights, Department of Health and Human 
Services.

ACTION: Final rule.

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SUMMARY: The Department of Health and Human Services (HHS or ``the 
Department'') is issuing this final rule to modify the Health Insurance 
Portability and Accountability Act of 1996 (HIPAA) Privacy Rule to 
expressly permit certain HIPAA covered entities to disclose to the 
National Instant Criminal Background Check System (NICS) the identities 
of individuals who are subject to a Federal ``mental health 
prohibitor'' that disqualifies them from shipping, transporting, 
possessing, or receiving a firearm. The NICS is a national system 
maintained by the Federal Bureau of Investigation (FBI) to conduct 
background checks on persons who may be disqualified from receiving 
firearms based on Federally prohibited categories or State law. Among 
the persons subject to the Federal mental health prohibitor established 
under the Gun Control Act of 1968 and implementing regulations issued 
by the Department of Justice (DOJ) are individuals who have been 
involuntarily committed to a mental institution; found incompetent to 
stand trial or not guilty by reason of insanity; or otherwise have been 
determined by a court, board, commission, or other lawful authority to 
be a danger to themselves or others or to lack the mental capacity to 
contract or manage their own affairs, as a result of marked subnormal 
intelligence or mental illness, incompetency, condition, or disease. 
Under this final rule, only covered entities with lawful authority to 
make the adjudications or commitment decisions that make individuals 
subject to the Federal mental health prohibitor, or that serve as 
repositories of information for NICS reporting purposes, are permitted 
to disclose the information needed for these purposes. The disclosure 
is restricted to limited demographic and certain other information 
needed for NICS purposes. The rule specifically prohibits the 
disclosure of diagnostic or clinical information, from medical records 
or other sources, and any mental health information beyond the 
indication that the individual is subject to the Federal mental health 
prohibitor.

DATES: Effective date: This final rule is effective on February 5, 
2016.

FOR FURTHER INFORMATION CONTACT: Andra Wicks, 202-205-2292.

SUPPLEMENTARY INFORMATION:

I. Background

    On January 16, 2013, President Barack Obama announced 23 executive 
actions aimed at curbing gun violence across the nation. Those actions 
include efforts by the Federal government to strengthen the national 
background check system, and a specific commitment to ``[a]ddress 
unnecessary legal barriers, particularly relating to the Health 
Insurance Portability and Accountability Act, that may prevent States 
from making information available to the background check system.'' The 
National Instant Criminal Background Check System (NICS) is the system 
used to determine whether a potential firearms recipient is statutorily 
prohibited from possessing or receiving a firearm. The Department 
proposed, and now finalizes, a modification to the HIPAA Privacy Rule 
to permit certain covered entities to disclose to the NICS the 
identities of persons who are not allowed to possess or receive a 
firearm because they are subject to the Federal mental health 
prohibitor.

The National Instant Criminal Background Check System (NICS)

    The Brady Handgun Violence Prevention Act of 1993, Public Law 103-
159 (Brady Gun Law), and its implementing regulations, are designed to 
prevent the transfer of firearms by licensed dealers to individuals who 
are not allowed to possess or receive them as a result of restrictions 
contained in either the Gun Control Act of 1968, as amended (Title 18, 
United States Code, Chapter 44), or State law. The Gun Control Act 
identifies several categories (known as ``prohibitors'') of individuals 
\1\ who are prohibited from engaging in the shipment, transport, 
receipt, or possession of firearms, including convicted felons and 
fugitives. Most relevant for the purposes of this rule is the Federal 
mental health prohibitor, which, pursuant to Department of Justice 
(DOJ) regulations, applies to individuals who have been involuntarily 
committed to a mental institution, for reasons such as mental illness 
or drug use; \2\ found incompetent to stand trial or not guilty by 
reason of insanity; or otherwise determined by a court, board, 
commission, or other lawful authority to be a danger to themselves or 
others or unable to manage their own affairs, as a result of marked 
subnormal intelligence, or mental illness, incompetency, condition, or 
disease.3 4
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    \1\ See 18 U.S.C. 922(g) and (n) and implementing regulations at 
27 CFR 478.11 and 27 CFR 478.32.
    \2\ The regulation, at 27 CFR 478.11, defines ``Committed to a 
mental institution'' as a formal commitment to the institution by a 
court or other lawful authority. The term does not apply to a person 
voluntarily admitted to a mental institution or in a mental 
institution merely for observation.
    \3\ The term used in the statute is ``adjudicated as a mental 
defective. The term includes a finding of insanity in a criminal 
case, and a finding of incompetence to stand trial or a finding of 
not guilty by reason of lack of mental responsibility pursuant to 
the Uniform Code of Military Justice. 27 CFR 478.11.
    \4\ This rule refers to the involuntary commitments and other 
applicable adjudications as, collectively, ``adjudications that make 
an individual subject to the Federal mental health prohibitor.''
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    The Brady Gun Law established the NICS to help enforce these 
prohibitions, as well as State law prohibitions on the possession or 
receipt of firearms.\5\ The NICS Index, a database administered by the 
Federal Bureau of Investigation (FBI), collects and maintains certain 
identifying information about individuals who are subject to one or 
more Federal prohibitors and thus who are ineligible to purchase 
firearms. As of 2012, the NICS Index also contains information on 
persons who are subject to State law prohibitions on the possession or 
receipt of firearms.\6\ The

[[Page 383]]

minimum information required in a NICS Index record consists of: The 
name of the ineligible individual; the date of birth; sex; and codes 
indicating the applicable prohibitor, the submitting entity, and the 
agency record supporting the prohibition (e.g., an order for 
involuntary commitment). For individuals subject to the Federal mental 
health prohibitor, only the fact that the individual is subject to that 
prohibitor is submitted to the NICS; underlying diagnoses, treatment 
records, and other identifiable health information are not provided to 
or maintained by the NICS. A NICS background check queries the NICS 
Index and certain other national databases \7\ to determine whether a 
prospective buyer's identifying information matches any prohibiting 
records contained in the databases. The NICS Index can be accessed only 
for the limited purposes authorized by regulation (see 28 CFR 25.6(j)) 
and cannot be used for other purposes, including general law 
enforcement activities.
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    \5\ See Public Law 103-159, 18 U.S.C. 921-925, and implementing 
regulations at 28 CFR 25.1 through 25.11 (establishing NICS 
information system specifications and processes) and 27 CFR part 478 
(establishing requirements and prohibitions for commerce in firearms 
and ammunition, including requirements related to conducting NICS 
background checks); and 42 U.S.C. 3759(b) (allocating a percentage 
of certain DOJ funds for State reporting of NICS data).
    \6\ See Statement Before the Senate Judiciary Committee, 
Subcommittee on Crime and Terrorism at a hearing entitled, ``THE FIX 
GUN CHECKS ACT: BETTER STATE AND FEDERAL COMPLIANCE, SMARTER 
ENFORCEMENT'' (November 15, 2011), by David Cuthbertson, Assistant 
Director, Criminal Justice Information Services Division, Federal 
Bureau of Investigation. Testimony available at: https://www.justice.gov/ola/testimony/112-1/11-15-11-fbi-cuthbertson-testimony-re-the-fix-gun-checks-act.pdf. We note also that State law 
may be more restrictive than Federal law in some cases.
    \7\ The other databases include the Interstate Identification 
Index, which contains criminal history record information; and the 
National Crime Information Center, which includes, e.g., information 
on persons subject to civil protection orders and arrest warrants. 
Additional information is available at, https://www.fbi.gov/about-us/cjis/nics/general-information/nics-overview.
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    The potential transfer of a firearm from a Federal Firearms 
Licensee (FFL) to a prospective buyer proceeds as follows: First, the 
prospective buyer is required to provide personal information on a 
Firearms Transaction Record (ATF Form 4473). Unless the prospective 
buyer has documentation that he or she qualifies for an exception to 
the NICS background check requirement under 18 U.S.C. 922(t)(3),\8\ the 
FFL contacts the NICS--electronically, by telephone, or through a State 
level point of contact--and provides certain identifying information 
about the prospective buyer from ATF Form 4473.\9\
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    \8\ These exceptions are listed in the Bureau of Alcohol, 
Tobacco, Firearms and Explosives (ATF) regulation at 27 CFR 
478.102(d). For example, a NICS check would not be required where 
the potential recipient of a firearm has presented a valid State 
permit or license, provided conditions at 27 CFR 478.102(d)(1) are 
met.
    \9\ The form collects the prospective buyer's name; demographic 
information such as address, place and date of birth, gender, 
citizenship, race and ethnicity; and ``yes'' or ``no'' answers to 
questions about the person's criminal history and other potential 
prohibitors. The form is available at https://www.atf.gov/forms/download/atf-f-4473-1.pdf.
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    The FFL then receives a response that the prospective firearm 
transfer may proceed or is delayed. The transfer is delayed if the 
prospective buyer's information matches a record contained in one of 
the databases reviewed. If there is a match, a NICS examiner reviews 
the record to determine whether the information it contains is, in 
fact, prohibiting, and then either: (1) If the record does not contain 
prohibiting information, advises the FFL to proceed with the 
transaction; (2) if the record does contain prohibiting information, 
denies the transaction (due to ineligibility); or (3) if it is unclear 
based solely on the existing information in the record whether it is 
prohibiting, delays the transaction pending further research.\10\ The 
NICS examiner does not disclose the reason for the determination to the 
FFL (e.g., the FFL would not learn that the individual was ineligible 
due to the Federal mental health prohibitor). In case of a delay, if 
the NICS examiner does not provide a final instruction to the FFL 
within three business days of the initial background check request, the 
FFL may proceed with the transaction.\11\
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    \10\ For example, a ``delay'' response may mean that further 
research is required because potentially prohibitive criteria exist, 
but the matched records are incomplete, See Federal Bureau of 
Investigation (FBI) Fact Sheet at: www.fbi.gov/about-us/cjis/nice/general-information/fact-sheet.
    \11\ Some States have waiting periods that also must be complied 
with before a firearm may be transferred, regardless of whether a 
proceed response from NICS is received by the FFL within three 
business days.
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    Although FFLs are required in most cases to request a background 
check through the NICS before transferring a firearm to a prospective 
buyer,\12\ Federal law does not require State agencies to report to the 
NICS the identities of individuals who are prohibited from purchasing 
firearms under either Federal or State prohibitors, and not all States 
report complete information to the NICS or the databases checked by it. 
Following the shooting at Virginia Tech University in 2007, and other 
tragedies involving the illegal use of firearms, Congress enacted the 
NICS Improvement Amendments Act (NIAA) of 2007, Public Law 110-180. 
Among other provisions, the NIAA requires Federal agencies to make 
accessible to the NICS the identities of individuals known by the 
agencies to be subject to one or more prohibitors, and it authorizes 
incentive grants for States to provide such information when it is in 
their possession.\13\ In addition, some States have enacted legislation 
requiring the reporting of the identities of ineligible individuals to 
databases accessible to the NICS or to a State level repository 
responsible for submitting information to the relevant databases.
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    \12\ See 27 CFR 478.102. Exceptions to this requirement are 
referenced in FN 8 above, and listed in the regulation at 27 CFR 
478.102(d).
    \13\ Eligibility for these grants is limited to States that have 
implemented a ``relief from disabilities'' program for individuals 
who are prohibited from possessing or receiving firearms for mental 
health reasons. Such programs must provide that a State court, 
board, commission, or other lawful authority shall grant the relief 
if, based on the circumstances regarding the disabilities and the 
person's record and reputation, the person is not likely to pose a 
danger to public safety, and granting the relief would not be 
contrary to the public interest. See Public Law 110-180, Section 
105.
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    States generally report criminal history information to the other 
relevant databases that are checked by the NICS; however, many States 
continue to report little if any information concerning individuals 
subject to the Federal mental health prohibitor (or the other Federal 
prohibitors) to the NICS Index.\14\ As a result, the NICS does not have 
access to complete information about all individuals who are subject to 
one or more of the Federal prohibited categories or who are prohibited 
from possessing or receiving firearms under State law.
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    \14\ Federal law does not require States to submit reports to 
any of the three databases (the NICS Index, the III, and NCIC) 
accessed during a NICS Check.
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The HIPAA Privacy Rule and NICS Reporting

    The Privacy Rule, promulgated under the Health Insurance 
Portability and Accountability Act of 1996 (HIPAA), Title II, Subtitle 
F--Administrative Simplification, Public Law 104-191, establishes 
federal protections to ensure the privacy and security of protected 
health information (PHI) and establishes an array of individual rights 
with respect to one's own health information. HIPAA applies to covered 
entities, which include health plans, health care clearinghouses, and 
health care providers that conduct certain standard transactions (such 
as billing insurance) electronically. HIPAA covered entities may only 
use and disclose PHI with the individual's written authorization, or as 
otherwise expressly permitted or required by the HIPAA Privacy Rule.
    The Privacy Rule seeks to balance individuals' privacy interests 
with important public policy goals including public health and safety. 
In doing so, the Privacy Rule allows, subject to certain conditions and 
limitations, uses and disclosures of PHI without individuals' 
authorization for certain law enforcement purposes, to avert a serious 
threat to health or safety, and where required by State or other law, 
among other purposes.\15\
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    \15\ See 45 CFR 164.512.

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[[Page 384]]

    As stated above, individuals who are subject to the Federal mental 
health prohibitor are ineligible to purchase a firearm because they 
have been ``committed to a mental institution'' or ``adjudicated as a 
mental defective.'' \16\ DOJ regulations define these categories to 
include persons who have been involuntarily committed to a mental 
institution for reasons such as mental illness or drug use; have been 
found incompetent to stand trial or not guilty by reason of insanity; 
or otherwise have been determined by a court, board, commission, or 
other lawful authority to be a danger to themselves or others or unable 
to manage their own affairs, as a result of marked subnormal 
intelligence, or mental illness, incompetency, condition, or disease. 
In many cases, these records are not subject to HIPAA. Records of 
individuals adjudicated as incompetent to stand trial, or not guilty by 
reason of insanity, originate with entities in the criminal justice 
system, and these entities are not HIPAA covered entities. Likewise, 
involuntary civil commitments usually are made by court order, and 
thus, records of such formal commitments typically originate with 
entities in the justice system. In addition, many adjudications 
determining that individuals are a danger to themselves or others, or 
are incapable of managing their own affairs, occur through a legal 
process in the court system.
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    \16\ See 18 U.S.C. 922(g)(4).
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    However, because of the variety of State laws, there may be State 
agencies, boards, commissions, or other lawful authorities outside the 
court system that are involved in some involuntary commitments or 
mental health adjudications that make an individual subject to the 
Federal mental health prohibitor. Moreover, we understand that some 
States have designated repositories to collect and report to the NICS 
the identities of individuals subject to the Federal mental health 
prohibitor. We believe that certain of these lawful authorities or 
repositories also may be HIPAA covered entities (e.g., a State health 
agency may be a covered entity).
    As we described in the NPRM, where the record of an involuntary 
commitment or mental health adjudication originates with a HIPAA 
covered entity, or the HIPAA covered entity is the State repository for 
such records, there are two ways in which covered entities can 
currently report to the NICS (without the individual's authorization). 
First, a covered entity can disclose the relevant information to the 
NICS where a State has enacted a law that requires (and does not merely 
authorize) such reporting.\17\ Second, where a State has not enacted 
such a law, a HIPAA covered entity that performs both health care and 
non-health care functions (e.g., NICS reporting) could become a hybrid 
entity under HIPAA so that the Privacy Rule applies only to its health 
care functions. A covered entity can achieve hybrid entity status by 
designating its health care components as separate from other 
components, documenting the designation, and implementing policies and 
procedures to prevent unauthorized access to PHI by the entity's non-
covered components.\18\ Under these circumstances, the covered entity 
can report prohibitor information through its non-HIPAA covered NICS 
reporting unit without restriction under the Privacy Rule. These 
provisions remain in effect and are not altered by the amendments to 
the Privacy Rule that we issue today.
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    \17\ See 45 CFR 164.512(a). Note that disclosures for NICS 
purposes would not fall under the Privacy Rule's provisions 
permitting disclosures for law enforcement purposes (which apply to 
specific law enforcement inquiries) or to avert a serious threat to 
health or safety (which require an imminent threat of harm). See 45 
CFR 164.512(f) and (j).
    \18\ See 45 CFR 164.103, 164.105; 67 FR 53182 (8/14/2002).
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    However, despite these avenues for disclosure, many States still 
were not reporting to the NICS essential information on persons 
prohibited from possessing firearms for reasons related to mental 
health; concerns were raised that the HIPAA Privacy Rule's restrictions 
on covered entities' disclosures of PHI might be preventing certain 
States from reporting the relevant information to the NICS.
    In addition, in July 2012, the U.S. Government Accountability 
Office (GAO) reported to Congress on the results of a survey of six 
States that it had assessed as part of a performance audit of the 
progress made by DOJ and the States in implementing the NIAA.\19\ In 
the report, the GAO wrote that ``officials from 3 of the 6 States we 
reviewed said that the absence of explicit State-level statutory 
authority to share mental health records was an impediment to making 
such records available to NICS.'' \20\ The report also stated that, 
although the number of records provided by the States to the NICS had 
increased by 800 percent between 2004 and 2011, this increase was 
largely due to efforts by only 12 States. The report raised the 
possibility that States that do not report to the NICS the identities 
of individuals who are prohibited from possessing firearms for reasons 
related to mental health may experience challenges to reporting related 
to the HIPAA Privacy Rule.
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    \19\ See GAO-12-684, Gun Control: Sharing Promising Practices 
and Assessing Incentives Could Better Position Justice to Assist 
States in Providing Records for Background Checks.
    \20\ We note that the GAO Report uses the term ``mental health 
records'' to refer to identifying information on individuals who are 
subject to the Federal mental health prohibitor. To avoid implying 
that mental health records are collected by NICS, the Department 
uses the terms ``identities,'' ``information,'' or ``data'' in place 
of ``mental health records.'' GAO-12-684, p. 12.
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II. The ANPRM

Background

    On April 23, 2013, the Department published an Advance Notice of 
Proposed Rulemaking (ANPRM) requesting public input on these issues (78 
FR 23872). The ANPRM explained that the Department was considering 
creating an express permission in the HIPAA Privacy Rule for reporting 
information relevant to the Federal mental health prohibitor to the 
NICS by those HIPAA covered entities that (a) are responsible for the 
involuntary commitments or other adjudications that make individuals 
subject to the Federal mental health prohibitor, or (b) are designated 
by a State to report to the NICS. In the ANPRM, the Department 
indicated that such an amendment might produce clarity regarding the 
Privacy Rule and help make it simpler for States to report the 
identities of such individuals to the NICS.
    To inform our efforts to address any issues in this area, we 
requested comments on a series of questions concerning the nature and 
scope of the problem of underreporting and whether a modification to 
the Privacy Rule would help address these issues. We also requested 
comments on any implications of a modification to the Privacy Rule for 
the mental health community or for the treatment of individuals, and 
how the Department might address any unintended consequences of such a 
modification. We received over 2,050 comments in response from 
individuals, State agencies, health care providers, associations of 
health care professionals, consumer advocacy groups, and other 
stakeholders.
    A number of commenters supported creating an express permission as 
a way to remove a potential barrier to an important and necessary 
public safety measure, which could help keep firearms out of the hands 
of individuals who should not have them by strengthening the background 
check system. Many others generally expressed concern that the NICS, 
the Federal mental health prohibitor, and

[[Page 385]]

the contemplated HIPAA permission would infringe on their Second 
Amendment right to bear arms and the right to be afforded due process 
of law under the U.S. Constitution. In addition, many individual 
commenters, as well as health care providers, organizations 
representing providers, and consumer advocacy groups, emphasized the 
importance of protecting individuals' health information privacy. These 
commenters raised concerns regarding the possible adverse consequences 
an express permission to report certain information could have on the 
patient-provider treatment relationship and individuals' willingness to 
seek needed mental health care.\21\
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    \21\ Please see the ANPRM for a more thorough discussion of 
public comments and responses. 78 FR 23872 (April 23, 2013).
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III. Summary of the NPRM

    After considering the public comments received on the ANPRM, we 
published a Notice of Proposed Rulemaking (NPRM) on January 7, 
2014,\22\ proposing to use the Department's broad authority under HIPAA 
to specify the permitted uses and disclosures of PHI by HIPAA covered 
entities. The NPRM proposed to revise 45 CFR 164.512 of the Privacy 
Rule by adding a new category of permitted disclosures to 45 CFR 
164.512(k), which addresses uses and disclosures for specialized 
government functions. The NPRM proposed new provisions at (k)(7) that 
would permit certain covered entities to disclose the limited 
demographic and certain other information needed for NICS reporting 
purposes.
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    \22\ See 79 FR 784 (January 7, 2014).
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    We indicated in the NPRM that there is a strong public safety need 
for this information to be accessible to the NICS and that some States 
are currently under-reporting or not reporting this information at all. 
Further, although most of the information relevant to the Federal 
mental health prohibitor is held by entities that are not covered by 
HIPAA, for those few HIPAA covered entities that may be involved in the 
relevant commitments or adjudications, the Privacy Rule's existing 
paths for disclosure did not appear to be sufficient. We explained 
that, to the extent that some covered entities perform adjudicatory or 
repository functions in States that have not enacted laws requiring 
reporting to the NICS, and that a subset of those may be unable to 
achieve hybrid entity status due to administrative challenges or other 
reasons, an express permission would provide clarity and remove a 
barrier to their reporting.
    However, to address concerns regarding an express permission's 
potential to harm the patient-provider relationship or deterring 
individuals from seeking needed mental health care, we proposed to 
narrowly tailor the permission to report information on individuals 
subject to the Federal mental health prohibitor in a number of ways. 
Specifically, we proposed to limit: (1) Which covered entities could 
use or disclose PHI for NICS reporting purposes, (2) to whom the PHI 
could be disclosed, and (3) the scope of the information that could be 
used or disclosed.
    First, the NPRM proposed a new paragraph at 164.512(k)(7)(i) to 
permit certain NICS disclosures only by those covered entities that 
function as repositories of information relevant to the Federal mental 
health prohibitor on behalf of a State or that are responsible for 
ordering the involuntary commitments or other adjudications that make 
an individual subject to the Federal mental health prohibitor. The 
Federal prohibitor regulations define an involuntary commitment as a 
formal commitment of a person to a mental institution by a court, 
board, commission, or other lawful authority. The other applicable 
adjudications include determinations by a court, board, commission, or 
other lawful authority that persons are a danger to themselves or 
others, or lack the mental capacity to contract or manage their own 
affairs, as a result of marked subnormal intelligence, or mental 
illness, incompetency, condition, or disease.\23\ The prohibitor does 
not apply to individuals in a psychiatric facility for observation or 
who have been admitted voluntarily; thus, the proposed rule would not 
have permitted disclosures with respect to those individuals.
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    \23\ See 27 CFR 478.11 (Definitions).
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    With respect to repositories of Federal mental health prohibitor 
information, we explained further that we did not intend to require 
States to formally designate the entities responsible for NICS 
reporting, but that we would expect States to be able to identify the 
relevant entities.
    We noted in the NPRM that our understanding was that lawful 
authority for performing such adjudications and repository functions 
rests, for the most part, with entities that operate outside the scope 
of HIPAA. However, in the interest of public safety, we wanted to 
ensure that relevant adjudications could be reported in the subset of 
States in which HIPAA covered entities may make, or collect and report 
records of, these determinations.
    We explained further that, in permitting only entities involved in 
these adjudicatory or repository/reporting functions to use or disclose 
Federal mental health prohibitor information for NICS purposes, the 
proposal would not create a permission for most treating providers to 
disclose PHI about their own patients for these purposes. We agreed 
with the commenters on the ANPRM who argued that encouraging voluntary 
treatment is critical to ensuring positive outcomes for individuals' 
health as well as the public's safety, and explained that the NPRM was 
designed to balance that goal and the public safety interests served by 
the NICS. We also agreed that non-health care entities bear primary 
responsibility for collection and reporting of information relevant to 
the Federal mental health prohibitor in most States. However, where a 
HIPAA covered entity is a board, commission, or other lawful authority 
that makes involuntary commitments or other adjudications that result 
in individuals being subject to the Federal mental health prohibitor, 
we believed those entities too were likely to hold records of the 
relevant commitments and adjudications.
    We requested public comment on the extent to which some States may 
have vested responsibility for Federal mental health prohibitor 
reporting in HIPAA covered entities, to what extent records needed for 
NICS reporting are created or maintained by covered entities, and 
whether there are circumstances in which health care providers would 
need to report the identity of an individual subject to the Federal 
mental health prohibitor to a State designated records repository or 
directly to the NICS. We also requested comment on the types of 
additional guidance from OCR and/or the NICS that would be helpful for 
understanding to which covered entities, and under what circumstances, 
the proposed permission would apply.
    Second, we proposed a new paragraph at (k)(7)(ii) providing that a 
covered entity identified in (k)(7)(i) may use or disclose Federal 
mental health prohibitor information for NICS purposes only directly to 
the NICS or to an entity designated by the State as a repository of 
data for purposes of reporting to the NICS. By clearly delimiting the 
permitted recipients of such disclosures, we explained that the rule 
would ensure that covered entities do not exceed the intended scope of 
the permission by disclosing information relevant to the Federal mental 
health

[[Page 386]]

prohibitor to, for example, law enforcement agencies that do not 
operate as repositories of data for purposes of reporting to the 
NICS.\24\ We requested comment on whether there are States in which a 
type of entity not described in this proposed paragraph is responsible 
for NICS reporting and thus, should be able to receive NICS data from a 
HIPAA covered entity.
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    \24\ We did not propose to change the Privacy Rule's existing 
permissions to use or disclose PHI for specific law enforcement 
investigations, as provided in 45 CFR 164.512(f).
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    Third, we proposed a new paragraph at (k)(7)(iii) to limit the 
information permitted to be used or disclosed to what is needed for 
purposes of reporting to the NICS. This is consistent with the Privacy 
Rule provision that generally requires covered entities to make 
reasonable efforts to limit the PHI used or disclosed to the minimum 
necessary to accomplish the intended purpose. Specifically, in the 
proposed regulation text, we made clear that only the limited 
demographic and certain other information needed for purposes of 
reporting to the NICS could be reported under the permission. We 
indicated that, at the time, we believed that the necessary information 
would be the data elements needed to create a NICS Index record: (1) 
Name of the individual; (2) date of birth; (3) sex; (4) a code or 
notation indicating that the individual is subject to the Federal 
mental health prohibitor; (5) a code or notation representing the 
reporting entity; and (6) a code identifying the agency record 
supporting the prohibition. The proposed regulation text expressly 
provided that the proposed modification would not permit the use or 
disclosure of clinical or diagnostic information for NICS reporting 
purposes. We requested comment on whether, and in what circumstances, 
HIPAA covered entities or other entities, such as courts, currently 
report to a records repository or directly to the NICS information that 
was not listed in the proposed paragraph.
    In addition, we explained that we were also considering permitting 
the disclosure of some or all the following additional data elements, 
which are optional fields for a NICS Index entry, for NICS reporting 
purposes: Social Security number, place of birth, State of residence, 
height, weight, eye color, hair color, and race. As we noted in the 
NPRM, from what we understand, these elements are not included in every 
NICS record, but often are used to confirm that a prospective firearm 
recipient matches a record searched by the NICS or to eliminate ``false 
positive'' background check results. We requested public comment on 
this issue.
    We also proposed to limit the permission to uses and disclosures 
about individuals who are subject to the Federal mental health 
prohibitor and not to apply it to disclosures about individuals subject 
only to State mental health prohibitors. However, we requested comment 
on this aspect of the scope of the permission, specifically with regard 
to whether the permission should be broadened to allow covered entities 
to also disclose the identities of individuals who are prohibited by 
State law from possessing or receiving firearms for reasons related to 
mental health.
    Finally, we also explained that the proposed permission would apply 
only with respect to the PHI of individuals subject to the Federal 
mental health prohibitor and not to the PHI of those persons who may be 
subject to the other Federal prohibitors listed at 18 U.S.C. 922(g). 
The lack of an express HIPAA permission for reporting information 
relevant to the Federal mental health prohibitor was a limited problem 
and we had not heard that there was a similar issue with respect to the 
other prohibitors. Thus, for example, a covered entity would not be 
able to use the proposed permission to use or disclose information 
about an individual who is an unlawful user of or addicted to any 
controlled substance (18 U.S.C. 922(g)(3)), except to the extent the 
individual was also subject to the Federal mental health prohibitor. We 
also noted that other laws could impact disclosures related to the 
other Federal prohibitors, including 18 U.S.C. 922(g)(3).\25\
---------------------------------------------------------------------------

    \25\ The ability of certain entities to report individuals who 
are subject to the Federal prohibitor at 18 U.S.C. 922(g)(3) may be 
affected by the Confidentiality of Alcohol and Drug Abuse Patient 
Records Regulations, 42 CFR part 2, administered by the Substance 
Abuse and Mental Health Services Administration (SAMHSA).
---------------------------------------------------------------------------

IV. Provisions of the Final Regulation

    This final rule adopts the modifications to the HIPAA Privacy Rule 
as proposed. After considering the comments we received, we continue to 
believe that the creation of a limited express permission in the HIPAA 
Privacy Rule to use or disclose certain information relevant to the 
Federal mental health prohibitor for NICS purposes is necessary to 
address barriers related to HIPAA and to ensure that relevant 
information can be reported for this important public safety purpose. 
Furthermore, this narrowly tailored rule appropriately balances public 
safety goals with important patient privacy interests to ensure that 
individuals are not discouraged from seeking voluntary treatment.
    Under this final rule, covered entities that order involuntary 
commitments or make other adjudications that subject individuals to the 
Federal mental health prohibitor, or that serve as repositories of the 
relevant data, are permitted to use or disclose the information needed 
for NICS reporting of such individuals either directly to the NICS or 
to a State repository of NICS data. Thus, if a covered health care 
entity also has a role in the relevant mental health adjudications or 
serves as a State data repository, it now may disclose the relevant 
information for NICS reporting purposes under this new permission even 
if it is not designated as a HIPAA hybrid entity or required by State 
law to report. This final rule does not create an express permission 
for covered entities to disclose for NICS reporting purposes the PHI of 
individuals who are subject to State-only mental health prohibitors.
    The Department's rationale for adopting the provisions in this 
final rule, along with further clarifications and interpretations of 
the provisions, is explained below in the responses to the public 
comments on the NPRM.

V. Analysis of and Responses to Public Comments

    We received more than 430 public comments in response to the NPRM, 
including from advocacy organizations, associations of health care and 
mental health professionals, a state mental health agency, and 
individual members of the public. A summary of the comments we received 
on the proposed rule and our responses follow.

A. Comments Regarding Creating an Express Permission for NICS Reporting 
in the HIPAA Privacy Rule

    Comments: A number of commenters expressed general support for 
including an express permission in the HIPAA Privacy Rule for reporting 
certain information to the NICS, stating that the rule change would 
help increase the reporting of information to the NICS, reduce the 
ability of individuals with serious mental health problems to obtain 
firearms, and ultimately lessen the risk of harm to the individuals 
themselves, law enforcement, and the public.
    Several advocacy organizations involved in gun violence prevention 
agreed with our statements in the NPRM that the HIPAA Privacy Rule and, 
in some cases, perceptions of the Privacy Rule, may create a barrier to 
certain entities reporting to the NICS, and that the proposed 
modification would

[[Page 387]]

address this problem. For example, the comment submitted by Mayors 
Against Illegal Guns (MAIG) indicated that mental health treatment 
facilities in seven States currently are required by State law to 
report Federal mental health prohibitor information either directly to 
the NICS or to State agencies that report to the NICS, which indicates 
that mental health facilities do in some cases hold the relevant 
records. MAIG inferred from this information that there likely are 
other States in which HIPAA covered entities have information that 
should be reported to the NICS, but that the entities may not be 
reporting due to concerns about the HIPAA Privacy Rule's restrictions 
on disclosures. MAIG also cited statements from interviews its 
researchers conducted with State officials about issues related to NICS 
reporting and noted that officials from nine States and the District of 
Columbia had expressed concern that HIPAA, or other privacy 
requirements, generally prohibited sending records to the NICS, and 
thus that reporting would violate such requirements. MAIG asserted that 
whether these cited concerns were based on real or perceived barriers, 
its research indicated that making clear the ability to report without 
violating privacy laws tended to greatly improve state reporting rates, 
and that the proposed modifications to the Privacy Rule similarly would 
help states improve their record submissions.\26\
---------------------------------------------------------------------------

    \26\ MAIG, Fatal Gaps, How Missing Records in the Federal 
Background Check System Put Guns in the Hands of Killers (Nov. 
2011).
---------------------------------------------------------------------------

    A number of commenters asserted that increasing reporting to the 
NICS could, in turn, help to decrease rates of gun violence. One of 
these commenters cited research indicating that, in one State, having a 
mental health adjudication record in the NICS database appeared to 
reduce the chance of a person committing a first violent crime.\27\
---------------------------------------------------------------------------

    \27\ The commenter cited Jeffrey Swanson, Preventing Gun 
Violence Involving People with Serious Mental Illness in REDUCING 
GUN VIOLENCE IN AMERICA, INFORMING POLICY WITH EVIDENCE AND ANALYSIS 
(eds. Daniel W. Webster and Jon S. Vernick, 2013). The study authors 
note that, ``[c]onsidering separately the subgroup of people with 
serious mental illness who do not have criminal records, our data 
seem to suggest that the Brady Law background checks can have some 
positive effect, if enforced. In those with a gun-disqualifying 
mental health record, risk of violent criminal offending declined 
significantly after Connecticut began reporting gun-disqualifying 
mental health records to the NICS.'' The authors also describe the 
limitations of the study and add, ``[t]hese findings do not prove a 
causal relationship between the background check system and reduced 
violent crime.''
---------------------------------------------------------------------------

    In addition, a number of commenters, including the American Medical 
Association (AMA), and the American Psychiatric Association (APA), 
expressed appreciation that the proposed rule would appropriately 
balance protecting public safety and preserving the patient-physician 
relationship by narrowly defining the scope of the permission. The AMA 
stated that its view on the issue of reporting patient information to 
the NICS is governed by the association's Code of Medical Ethics and 
policies adopted by the AMA's policy making body. The AMA indicated 
that the Code of Ethics supports strong protections for patient privacy 
and, in most cases, requires physicians to keep patient medical records 
strictly confidential. If there must be a breach in confidentiality, 
such as for public health or safety reasons, the disclosures must be as 
narrow in scope as possible. In light of these considerations, the AMA 
expressed support for the Department's approach.
    In contrast, many commenters did not support adding an express 
permission in the HIPAA Privacy Rule for reporting certain information 
about persons subject to the Federal mental health prohibitor for NICS 
purposes. Several commenters asserted that there are only ``perceived 
barriers'' related to HIPAA, not real ones, so changing HIPAA would be 
unlikely to increase the reporting of mental health prohibitor 
information for NICS purposes. One commenter suggested that, rather 
than facing obstacles to reporting, States may be choosing not to 
report on certain categories of prohibited individuals for reasons 
unrelated to HIPAA--for example, because the States do not believe the 
individuals pose a danger.
    Other comments, some of which highlighted the importance of early 
and appropriate mental health intervention as the most effective way to 
prevent violence related to mental illness, expressed concern that the 
proposed permission would discourage individuals from seeking needed 
treatment. For example, the National Association of Psychiatric Health 
Systems (NAPHS) predicted that the public perception of the proposed 
rule would be that, if an individual disclosed information to a 
therapist, the therapist would be required to ``report'' the patient. 
This commenter argued that, as a result, the proposed rule would create 
a chilling effect on individuals' willingness to discuss issues in 
treatment that could lead to positive resolution rather than violence 
directed toward themselves or others. A number of commenters also 
expressed concern that the proposed rule would unfairly target persons 
with mental illness and perpetuate unfounded and damaging stereotypes 
about persons with mental illness by sending a message to the public 
that the Department perceives mental illness as inextricably linked 
with violence.
    Some commenters expressed general concern regarding the effects of 
the proposed rule on individuals' privacy interests. A number of these 
commenters argued that communications between patients and their health 
care providers should be kept confidential under all circumstances.
    Response: After considering the comments, we continue to believe 
that the creation of a limited express permission in the HIPAA Privacy 
Rule to disclose information relevant to the Federal mental prohibitor 
for NICS purposes is necessary to address barriers to reporting. In 
particular, to the extent that some States do not require reporting by 
law, and reporting entities in those States may face administrative or 
other challenges in creating a hybrid entity, the HIPAA Privacy Rule 
may create impediments to reporting that cannot be cured through mere 
guidance. Therefore, we believe such an express permission will serve 
an important public safety interest by removing a barrier to reporting 
that may exist in certain circumstances and thereby potentially 
increase reporting by States that historically have reported little or 
no Federal mental health prohibitor data to the NICS due to concerns 
about violating the Privacy Rule.
    Further, we believe that the limitations contained in the narrowly 
tailored express permission we adopt appropriately respond to 
commenters' important concerns about discouraging individuals who need 
mental health treatment from seeking care. First, we limit the 
permission to only those covered entities that order the involuntary 
commitments or make the other adjudications that cause individuals to 
be subject to the Federal mental health prohibitor, or that serve as 
repositories of such information for NICS reporting purposes. Thus, the 
rule does not affect most treating providers or create a permission for 
them to disclose PHI about their own patients for these purposes. 
Second, we permit such entities to disclose NICS data only to 
designated repositories or the NICS. Third, we limit the information 
that may be disclosed to certain demographic or other information that 
is necessary for NICS reporting. Finally, we do not expand the 
permission to encompass State law prohibitor information. These aspects 
of the provision are discussed more fully below. By limiting the 
permission in

[[Page 388]]

these ways, we protect the patient-provider relationship. Further, we 
believe these limitations carefully balance an individual's privacy 
interests with the public safety interest in reporting certain 
information to the NICS.
    In response to concerns that the rule unfairly singles out 
individuals with mental illness, we emphasize, as we did in the 
proposed rule, that a mental health diagnosis does not, in itself, make 
an individual subject to the Federal mental health prohibitor, which 
requires an involuntary commitment or adjudication that the individual 
poses a danger to self or others or lacks the mental capacity to 
contract or manage his or her own affairs.
    In addition, the Department continues to support efforts by the 
Administration to dispel negative attitudes and misperceptions relating 
to mental illness and to encourage individuals to seek voluntary mental 
health treatment. With the implementation of the Affordable Care Act, 
millions of Americans who did not previously have coverage will receive 
coverage for mental health services.

B. Comments Regarding the Scope of the Permission

Expanding to State Law Prohibitors
    Comments: We received several comments in response to our question 
about whether the permission should be expanded to include State law 
prohibitors. Of these, a minority of commenters supported expanding the 
proposed rule to permit disclosures of information about individuals 
who are subject to State-only mental health prohibitors (i.e., State 
prohibitors that have different criteria than the Federal mental health 
prohibitor). Several commenters who advocated for the disclosure of 
such information for NICS reporting purposes asserted that State law 
prohibitors would be effective only if accurate and adequate 
information were submitted to the NICS. One of these commenters argued 
that State efforts to report disqualifying records to the NICS should 
be encouraged, not curtailed by confusion over the applicability of the 
HIPAA Privacy Rules. The commenter also argued that it would create 
greater confusion not to include the same express permission with 
respect to State mental health prohibitor information as was proposed 
for the reporting of information related to the Federal mental health 
prohibitor.
    Another commenter who supported a permission to disclose 
information about individuals who are subject to State-only mental 
health prohibitors argued that increasing the disclosures to the NICS 
about individuals who are prohibited by State law (but perhaps not 
Federal law) from purchasing firearms could address the situation in 
which a person who is subject to a prohibitor in the person's State of 
residence enters another State temporarily for the sole purpose of 
obtaining a firearm and then returns to the State where ownership is 
prohibited with a firearm. This commenter voiced the concern that, if 
the State of residence does not provide information about individuals 
who are subject to State law prohibitors to the Federal background 
check system, a FFL in another State would not know that the individual 
is subject to a prohibitor.
    Several commenters asserted that an express permission to disclose 
information about individuals who are subject to State mental health 
prohibitors would help to avoid a misinterpretation that HIPAA 
prohibits disclosures of PHI relevant to State mental health 
prohibitors in circumstances when HIPAA otherwise would not. Another 
commenter argued that, as some State law prohibitors were enacted 
before HIPAA, State legislators would not have foreseen HIPAA-related 
obstacles to disclosure or the resulting need to require reporting to 
the NICS by law; as a result, those States may not have laws in place 
to require the reporting of State law prohibitors.
    One commenter who supported extending the permission argued that 
the reporting of State mental health prohibitors would be consistent 
with congressional intent, as expressed through statutes aimed at 
preventing gun violence. The commenter asserted that the NICS was 
established under the Brady Gun Law to serve as a central aggregated 
database of information regarding the identities of individuals who are 
prohibited from possessing firearms under any Federal, State, or local 
law.
    In contrast, a number of commenters, including several associations 
of mental health professionals, expressed concern that expanding the 
reporting permission to apply to State law mental health prohibitors 
would involve more treating health care providers in NICS reporting, 
and that individuals would not seek treatment for mental health 
problems if they felt that simply by seeking treatment they could be 
reported to the NICS.
    Several commenters, including two mental health professional 
associations, expressed concern that State mental health prohibitors 
are being expanded in an overly broad manner that will further negative 
attitudes and misperceptions about mental illness. The commenters 
pointed to an example of a State statute that requires health care 
providers to report to the NICS the identities of all individuals with 
intellectual disabilities, as well as individuals who voluntarily 
commit themselves to a mental institution.
    The CCDRTF provided additional examples of State law mental health 
prohibitors that are significantly broader than the Federal mental 
health prohibitor and expressed concern that many of these State 
prohibitors apply to individuals without the benefit of an adjudication 
by a court, board, commission or other lawful authority, as provided 
for under the Federal prohibitor.\28\ This commenter asserted that the 
Federal mental health prohibitor forbids the reporting of information 
to the NICS about individuals who are subject to broader State mental 
health prohibitors due to a lack of equivalent procedural protections 
for such individuals; therefore, this commenter argued, to permit 
reporting related to State mental health prohibitors would violate the 
Supremacy Clause and raise due process concerns.
---------------------------------------------------------------------------

    \28\ This commenter described laws enacted in four States. 
According to the commenter, New York law requires all mental health 
professionals to report any person undergoing treatment that is 
``likely to engage in conduct that would result in serious harm to 
self or others'' (citing N.Y. Mental Hygiene. Law Sec.  9.46), while 
New York's SAFE Act requires mental health treatment providers to 
report covered individuals to a state database without an 
adjudicatory process (citing N.Y. Mental Hygiene Law Sec.  9.46). In 
California, the commenter stated, prohibitors apply to individuals 
undergoing voluntary inpatient treatment (citing 30 Cal. Welf. & 
Inst. Code Sec.  8100(a)); and apply to individuals involuntarily 
held as inpatients under 72-hour holds (citing Cal. Welf. & Inst. 
Code Sec.  8103(f) and Cal. Welf. & Inst. Code Sec.  5150) without 
the types of adjudications contemplated under the Federal mental 
health prohibitor (citing 18 U.S.C. 922(g); U.S. v. Rehlander, 666 
F.3d 45, 50 (1st Cir. 2012). Finally, the commenter noted that 
Illinois and Hawaii have prohibitors that apply to all individuals 
who have received particular diagnoses (citing 31 430 Ill. Comp. 
Stat. 65/8(g) (intellectual disability) and (s) (developmental 
disability); Haw. Rev. Stat. Ann. Sec.  134-7(c) (persons with 
significant DSM diagnosed disorder).
---------------------------------------------------------------------------

    A number of commenters who opposed the reporting of State mental 
health prohibitors expressed concern that the broadest State law 
prohibitors would become the de facto national standard if the NICS 
were to include State law prohibitors. Others raised concerns about the 
increased complexity involved in accurately maintaining the NICS 
database with the addition of State law prohibitor records, including 
challenges associated with avoiding or identifying duplicate reports, 
resulting in less reliability, increased inaccuracy, and improper

[[Page 389]]

denial of rights, as well as adding complexity to appeals.
    Response: We share the concerns of commenters that, due to the 
breadth of some State law prohibitors, the inclusion of State-only 
prohibitors in the permission would increase the involvement of 
treating providers in NICS reporting, which could negatively affect 
patient-provider treatment relationships and discourage some 
individuals from seeking care. While we note that the NICS currently 
receives some information on State law prohibitors, given these 
concerns and the importance of protecting the patient-provider 
relationship, we do not think it is appropriate to expand the 
permission with respect to HIPAA covered entities. We agree with the 
commenters who stated that the health and safety of individuals and the 
public is best served if persons with mental illness obtain appropriate 
treatment; by limiting the permission to the narrower Federal mental 
health prohibitor, and carefully tailoring the permission in the ways 
described throughout this preamble, this final rule is designed to 
ensure that such persons are not discouraged from seeking care.
    With respect to some commenters' concerns about State mental health 
prohibitors being ineffective without a HIPAA disclosure permission, we 
note that the Privacy Rule does not affect the reporting of State law 
prohibitors by non-HIPAA covered entities, which are the entities that 
maintain most of the relevant information. Moreover, to the extent that 
covered entities maintain relevant State law prohibitor information and 
a State wants to ensure that the reporting of this information can 
occur, the Privacy Rule provides certain other avenues for disclosure, 
as we have described elsewhere. For example, although our balancing of 
interests limits this express permission under HIPAA to disclosures 
related to the Federal mental health prohibitor, this rule does not 
prevent State legislators from differently balancing the privacy, 
health, and public safety issues involved with respect to their State 
level mental health prohibitors--nor does the Federal mental health 
prohibitor itself prohibit reporting to the NICS of State law 
prohibitor information, as a commenter asserted. If State legislators 
determine that information related to a State-only prohibitor should be 
disclosed despite any potential chilling effect on seeking treatment, 
they can enact a State law requiring the relevant entities to report 
such information. Alternatively, the relevant covered entities can 
create a hybrid entity, separating their HIPAA covered health care 
functions from their NICS reporting or repository functions, such that 
the information maintained by the covered health care component is 
subject to the Privacy Rule, while information held by the non-covered 
component can be reported without regard to the Privacy Rule.
    We disagree with the commenters who argued that excluding State-
only mental health prohibitor information from the permission will 
create confusion. We do not think this will occur because this final 
rule clearly indicates that it applies where firearm possession is 
prohibited under a specific provision in Federal law. We also note that 
the rule delineates the types of covered entities that are permitted to 
disclose, the information they are permitted to share, the categories 
of individuals covered by the permission, and the entities to which 
they can make such disclosures. In addition, we intend to work with DOJ 
to develop additional guidance on the categories within the Federal 
mental health prohibitor. Moreover, we do not believe this final rule 
will create a misperception that HIPAA always prohibits the reporting 
to the NICS of individuals who are subject to State-only mental health 
prohibitors. As explained elsewhere in this preamble, the Privacy Rule 
already permits uses and disclosures of PHI that are required by law, 
including State law reporting requirements; also, HIPAA covered 
entities that perform both health care and non-health care functions 
(e.g., NICS reporting) are permitted to create hybrid entities under 
HIPAA so that the Privacy Rule applies only to their health care 
functions. This final rule does not change those provisions.
    Finally, we do not agree that Congress intended for State (or 
local) law prohibitor information to be reported to the NICS in all 
circumstances, such as where doing so would conflict with 
countervailing privacy concerns due to the treatment relationship 
between patients and health care providers. Therefore, this final rule 
balances a variety of important interests, including protecting the 
privacy of individuals' personal health information, ensuring access to 
needed mental health care services, and advancing the public safety 
interests in ensuring that persons who are prohibited by Federal law 
from purchasing or possessing a firearm for mental health reasons do 
not gain access to firearms.
Entities Permitted To Report
    Comment: Several commenters, including the AMA and the National 
Association of Psychiatric Health Systems, expressed support for the 
proposal to limit the permission to only those entities in a State that 
are directly involved in the relevant adjudications or maintain records 
of them for NICS reporting purposes. These commenters expressed 
appreciation for the narrow drafting of the NPRM based on the need to 
support provider-patient relationships and encourage individuals with 
mental illness to seek appropriate care.
    However, several advocacy organizations and many individuals argued 
that direct treatment providers should not be permitted to report 
information about their patients to the NICS under any circumstances 
(i.e., even if they are, or are part of, the entity that orders 
involuntary commitments or conducts other relevant adjudications, or 
serves as a repository of NICS data). Some of these commenters argued 
that reports to the NICS database should come only from the judiciary.
    Finally, we did not receive responses to the question we posed in 
the NPRM about whether additional types of covered entities within a 
State (other than those identified in the proposed regulatory text) 
might be expected, and thus should be permitted under the Privacy Rule, 
to report data to the NICS or to a State repository.
    Response: We agree with the commenters who emphasized the need to 
protect the provider-patient relationship, and this final rule 
addresses such concerns by limiting the permission to those covered 
entities that also perform an adjudicatory or data repository function. 
Furthermore, as described more fully elsewhere in this preamble, the 
permission does not extend to broader State law prohibitors, which may 
not require a formal adjudication or involuntary commitment and whose 
inclusion likely would involve more treatment providers in NICS 
reporting.
    In response to comments arguing that only entities in the court 
system should be permitted to report to NICS, it is our understanding, 
based on public comments and our fact finding, that courts do not 
create or maintain records of all of the involuntary commitments or 
other adjudications that make individuals subject to the Federal mental 
health prohibitor. Therefore, for the NICS database to include reports 
of all persons subject to the mental health prohibitor, it is necessary 
for certain other entities that create or maintain such information to 
be able to report. We believe this permission will help strengthen the 
background check system to ensure that individuals who are prohibited 
from purchasing or

[[Page 390]]

possessing firearms are prevented from obtaining them. We also 
acknowledge the concerns of commenters who argued that providers should 
not be permitted to report information about their patients under any 
circumstances. As explained in more detail elsewhere in this preamble, 
to address these and other concerns, we have carefully tailored this 
final rule to limit the involvement health care providers, and to 
prevent disclosures of diagnostic or clinical information for NICS 
reporting purposes.
Demographic and Certain Other Information Permitted To Be Reported
    Comment: Many commenters specifically voiced support for the NPRM's 
proposal not to permit the disclosure of diagnostic or clinical 
information for NICS reporting purposes. (We also noted in the NPRM 
that the NICS does not request or contain such information.) For 
example, the American Medical Association stated that it strongly 
supported restricting the information disclosed to the limited 
demographic and other information needed for reporting, as the NPRM 
proposed. To support the point that NICS reporting is sufficiently 
limited, another commenter pointed out that the information that is 
reported to the NICS generally is provided by the individual to a FFL 
on the required application for the firearm.
    In contrast, one commenter asserted that, as written, the proposed 
permission would grant discretion to state entities to determine the 
scope of ``demographic and certain other information'' to be reported 
and argued further that DOJ (specifically ATF), not HHS, has authority 
to define the ``minimum'' information required by NICS.
    In response to our request for comment on whether, and in what 
circumstances, entities currently report, or should be permitted to 
report, additional data elements needed to confirm an individual's 
identity, the Connecticut Department of Mental Health and Addiction 
Services (DMHAS) asserted that certain additional data elements are 
helpful in confirming whether an individual is appropriately excluded 
from gun purchase or possession in cases where multiple individuals 
share the same name and date of birth. Several other commenters agreed 
that permitting the disclosure of additional data elements for NICS 
reporting purposes would allow more accurate verification of an 
individual's identity, resulting in fewer erroneous denials, and would 
facilitate the correction and updating of NICS entries.
    The Connecticut DMHAS and others suggested the inclusion of some or 
all of the following specific data elements: Social Security number, 
place of birth, state of residence, height, weight, eye color, hair 
color, and race. Social Security number and race were cited as the most 
reliable indicators of an individual's true identity.
    Response: We agree with the commenters who stated that limiting the 
permission to exclude diagnostic and clinical information appropriately 
balances individuals' privacy interests and public safety priorities. 
We also agree that there may be data elements beyond those needed to 
create the NICS record (i.e., the individual's name, sex, and date of 
birth; as well as codes identifying (1) the Federal mental health 
prohibitor, (2) the record documenting the involuntary commitment or 
adjudication, and (3) the entity from which the record initiated) that 
may be helpful in verifying identity and excluding false matches. Given 
that, the final rule provides some flexibility for States or reporting 
entities. We do not specify in the regulatory text which data elements 
may be disclosed, but clarify in this preamble that what generally 
would be considered the information ``needed for purposes of reporting 
to the [NICS]'' in Sec.  164.512(k)(7)(iii)(A) would be the data 
elements required to create a NICS record, as well as the following 
elements to the extent necessary to exclude false matches: Social 
Security number, State of residence, height, weight, place of birth, 
eye color, hair color, and race (and we note that the Federal Bureau of 
Investigations (FBI) and not ATF has the authority to define the 
information required by NICS). As indicated above, these are the same 
elements that were identified in the NPRM.

C. Comments Regarding the NICS and the Federal Mental Health Prohibitor

    Comment: Many commenters raised concerns about infringement of 
individuals' Second Amendment right to bear arms without due process. A 
number of these commenters specifically expressed concern that an 
individual could be reported to the NICS without a formal adjudication 
through the court system and argued that due process under the 
Constitution would require a hearing in a court of law before an 
individual could be made subject to the Federal mental health 
prohibitor.
    Response: We acknowledge the views of the commenters. However, as 
we explained in the NPRM, these concerns relate to the Federal mental 
health prohibitor rather than the HIPAA Privacy Rule or this final 
rule, and thus are outside the scope of this rule. This final rule 
addresses HIPAA-related barriers to entities reporting certain 
information to the NICS about individuals who are subject to the 
Federal mental health prohibitor. The rule does not expand the 
categories of federally prohibited persons or modify the criteria for 
determining that a person is subject to the Federal mental health 
prohibitor.
    Comment: Several disability rights advocates and others asserted 
that the rule would not result in a decrease in gun violence because 
mental illness alone does not make a person more likely to commit 
violence against others. The Consortium for Citizens with Disabilities 
Rights Task Force (CCDRTF) cited studies indicating that mental illness 
alone is not statistically related to future violence and that even 
severe mental illness without drug use or a history of violence is not 
linked with future violence.\29\ Several commenters also noted that 
persons with mental illness are more likely to be the victims of 
violence than its perpetrators. Alternatively, several commenters 
argued that, even if there were a link between mental illness and gun 
violence, the proposed rule is not needed because mechanisms already 
are in place in place to prevent harm from patients who are a threat to 
themselves or the public.
---------------------------------------------------------------------------

    \29\ CCDRTF cited Eric B. Elbogen & Sally C. Johnson, The 
Intricate Link Between Violence and Mental Disorder: Results from 
the National Epidemiologic Survey on Alcohol and Related Conditions, 
66 Arch. Gen. Psychiatry 152, 157 (Feb. 2009); David J. Vinkers, et 
al., Proportion of Crimes Attributable to Mental Disorders in the 
Netherlands Population, 11 World Psychiatry 134 (June 2012). CCDRTF 
also indicated that other studies showed a modest relationship 
between serious mental illness and violence, but that other factors 
(e.g., substance abuse, age, gender and lower economic status) 
contribute more to increasing the likelihood of committing violence 
than mental illness alone. They cited R. Van Dorn, et al., Mental 
Disorder and Violence: Is There a Relationship Beyond Substance 
Use?, 47 Social Psychiatry and Psychiatric Epidemiology 487, 499 
(2012).
---------------------------------------------------------------------------

    Response: We acknowledge the views of the commenters. However, 
these commenters address the applicability of the Federal mental health 
prohibitor itself. This final rule does not expand the existing 
categories of persons prohibited from owning a firearm or modify other 
Federal or State laws pertaining to firearms purchases. Therefore, 
these comments are beyond the scope of this rule.
    Comment: Several commenters raised questions about individuals' 
ability to correct erroneous NICS reports or to

[[Page 391]]

have their rights restored when they no longer pose a danger to 
themselves or others. A number of commenters recommended assuring that 
the appeals process is free of delay, inexpensive, and easy for 
individuals to initiate.
    Other commenters asserted that the expense to remove oneself from 
the NICS database is prohibitive for some individuals. As a result, the 
commenters said, individuals effectively become subject to a lifelong 
restriction on their Second Amendment right to bear arms, even after 
they recover from the condition that led to their adjudication and are 
eligible to apply for relief from disabilities under the Federal mental 
health prohibitor. Similarly, one commenter argued that, once an 
individual is reported to the NICS, the ``relief from disabilities'' 
process \30\ is inadequate for remediation due to a lack of Federal 
funding to support State programs, and wide variability in State 
programs to provide relief as a result. Another commenter recommended 
allocating additional funding to support State ``relief from 
disabilities'' programs.
---------------------------------------------------------------------------

    \30\ See footnote 13 above.
---------------------------------------------------------------------------

    Response: These comments are outside the scope of the rule. 
However, we acknowledge the commenters' concerns with respect to 
opportunities for remediation and note that individuals who believe 
they are wrongly denied the purchase of a firearm can visit https://forms.fbi.gov/nice-appeals-request-form to find out more information 
and appeal their denial. In addition, the NICS Improvement Amendments 
Act of 2007 authorized grants for States that implement programs for 
``relief from disabilities'' in accordance with the Act.\31\ These 
programs are required to establish processes by which an individual who 
is subject to the Federal mental health prohibitor may apply for relief 
to the State where the relevant commitment or adjudication occurred. 
While States' processes for granting relief vary, the Act requires that 
relief be granted if it can be established that the circumstances 
regarding the disability and the applicant's record and reputation are 
such that the applicant will not be likely to act in a manner dangerous 
to public safety, and the granting of relief would not be contrary to 
the public interest.\32\
---------------------------------------------------------------------------

    \31\ The DOJ Bureau of Justice Statistics provides state data on 
NICS Act Record Improvement Program (NARIP) Awards (available at 
https://www.bjs.gov/index.cfm?ty=tp&tid=491#promising).
    \32\ See Public Law 110-180, Section 105.
---------------------------------------------------------------------------

    Comment: A number of commenters expressed concern that a finding of 
mental incompetence by the Veterans Administration (VA), which could 
make an individual subject to the Federal mental health prohibitor and 
cause the individual to be reported to the NICS, may be based solely on 
a determination that the veteran is unable to handle financial affairs, 
without regard to dangerousness. The commenters argued that these 
veterans do not receive due process before being made subject to the 
Federal mental health prohibitor and believed that the proposed rule 
would exacerbate this problem.
    Response: We note that, as a federal agency, the VA is required by 
law to report prohibited persons to the Attorney General, who oversees 
the NICS.\33\ This final rule does not affect that requirement or 
change the procedures relating to adjudications that make individuals 
subject to the Federal mental health prohibitor.\34\
---------------------------------------------------------------------------

    \33\ See NICS Improvement Amendments Act of 2007 Sec. 101, 18 
U.S.C. 922 note (2002).
    \34\ We refer commenters to the VA regulations for information 
about the due process afforded to veterans as part of VA competency 
determinations. See 38 CFR 3.353 and 38 CFR 3.103.
---------------------------------------------------------------------------

D. Other Comments

    Comment: A few commenters expressed concern that covered entities 
would misinterpret the proposed permission as a requirement to report 
information about their patients to the NICS. Another commenter 
expressed concern that the standards for reporting NICS data will be 
adopted by courts as a new standard of care for health care providers, 
exposing covered entities that do not report to increased liability. 
The commenter requested that the Department clarify that the HIPAA 
permission is permissive, not mandatory.
    Response: This final rule establishes permission for certain HIPAA 
covered entities--those with lawful authority to make the adjudications 
or commitment decisions that make individuals subject to the Federal 
mental health prohibitor, or that serve as repositories of information 
for NICS reporting purposes--are permitted to disclose the information 
needed for these purposes. The rule does not create a requirement to 
disclose. In addition, as explained at length in the NPRM and above, 
the rule does not apply to most treating providers, but only to those 
covered entities that are responsible for the involuntary commitments 
or other adjudications that make individuals subject to the Federal 
mental health prohibitor, or that serve as repositories of such data. 
However, we note that covered entities have a responsibility to comply 
with all applicable laws, and this final rule does not preempt State or 
other laws that may require reporting to the NICS.
    Comment: One commenter recommended that the Department evaluate 
whether the rule would have the unintended consequence of permitting 
the reporting of individuals based on mere medical findings.
    Response: As we explain above, the rule does not create a broad 
permission for treating providers to report information about their 
patients to the NICS. Rather, the rule is narrowly tailored to permit 
limited disclosures of information about individuals who are subject to 
the Federal mental health prohibitor, which applies only where an 
individual has been involuntarily committed or otherwise has received a 
relevant adjudication from a court, board, commission, or other lawful 
authority.
    Comment: One commenter recommended training for the workforce 
members of reporting entities to ensure that they understand the 
applicable reporting protocols sufficiently to avoid making erroneous 
reports.
    Response: We agree that training is generally beneficial to assure 
compliance with applicable standards. Further, to the extent that 
reporting entities also are HIPAA covered entities, the Privacy Rule 
requires those entities to train workforce members on the policies and 
procedures with respect to the privacy and security of individuals' 
health information. Where applicable, such training would include 
ensuring that workforce members have copies of the entity's policies 
and procedures implementing this final rule's limited permission for 
uses or disclosures of PHI for NICS reporting purposes.
    Comment: One commenter recommended establishing a mechanism to 
inform mental health patients and their caregivers about the patients' 
status in the NICS.
    Response: We decline to provide for such a mechanism in this final 
rule because it is outside the scope of the rule. Nothing in this rule, 
however, precludes covered entities from informing individuals that 
information about them has been provided to the NICS.
    Comment: Several commenters expressed concern that, by allowing 
multiple entities within a State to report to the NICS, the proposed 
rule would create complexity, inaccuracy, and delay in processing 
appeals, particularly if the FBI refers the individual back to the 
reporting entity for resolution.
    Response: To the extent that the involvement of multiple entities 
in NICS reporting may affect the appeals process in a state, this issue 
exists apart

[[Page 392]]

from HIPAA. Each State determines the entity or entities responsible 
for reporting NICS data, depending on where the records documenting a 
person's status as subject to one or more of the Federal prohibitors 
are created or maintained. As a result, a variety of entities, 
including judicial, law enforcement, public health, and other entities 
in a State, already may be involved in NICS reporting and appeals.
    Comment: A few commenters expressed concern that, as a result of 
the proposed rule, some families may choose not to seek involuntary 
commitment proceedings for a family member who needs treatment, but 
whose livelihood depends on the ability to possess a firearm (e.g., 
first responders and members of the military), because the commitment 
would result in a report to the NICS and the loss of the patient's 
livelihood.
    Response: We note that the Federal mental health prohibitor makes 
the purchase or possession of firearms by prohibited individuals 
unlawful regardless of whether an individual is reported to the NICS, 
and this final rule does not change who is subject to the Federal 
mental health prohibitor. This final rule also does not affect law 
enforcement and military entities' authorities with respect to making 
their workforce decisions.
    Comment: One commenter asked whether covered entities are obligated 
to update information they have submitted to the NICS when an 
individual's circumstances change.
    Response: Section 102(c)(1)(B) of the NIAA requires States to 
update, correct, modify, or remove a record from the NICS if they 
determine that the person is not prohibited or has received ``relief 
from disabilities'' under the mental health prohibitor.
    Comment: A number of commenters argued that the proposed regulation 
would contravene congressional intent, arguing that Congress did not 
intend to change HIPAA protections for NICS purposes. The commenters 
stated that legislation on this topic had been considered and rejected 
and specifically cited S. 649 (the ``Fix Gun Checks Act''), which was 
considered by the Senate on April 18, 2013, but did not receive a vote.
    Similarly, some commenters asserted that Congress could have 
included any desired changes to HIPAA when it passed the NICS 
Improvements Amendments Act, but did not do so. Therefore, the 
commenters argued, Congress did not intend to modify HIPAA for NICS 
reporting purposes.
    Response: That Congress did not enact S. 649 does not provide 
relevant evidence of congressional intent with respect to the scope of 
the HIPAA Privacy Rule. The absence of a provision in the NIAA to 
modify HIPAA does not imply that Congress intended to prevent any 
revisions of the HIPAA Privacy Rule with respect to the NICS. The HIPAA 
statute confers broad authority on the Department to specify the 
permitted uses and disclosures of PHI by HIPAA covered entities, and 
NIAA does not affect this statutory authority.
    Comment: Several disability rights organizations asserted that the 
proposed rule did not provide sufficient evidence of HIPAA barriers to 
reporting in any State to fulfill a requirement of the Administrative 
Procedure Act (APA) that there be a rational connection between the 
facts found by a Federal agency through the rulemaking process and the 
regulatory choice made.\35\
---------------------------------------------------------------------------

    \35\ 5 U.S.C. Subchapter II.
---------------------------------------------------------------------------

    Response: We disagree with the commenters. As stated above, we 
understand from other comments that at least seven States currently 
rely on HIPAA covered entities (such as mental health facilities) to 
report Federal mental health prohibitor data to the NICS. These seven 
States have laws regarding such reporting, but other States may not. To 
the extent that any other State does not require NICS-related 
disclosures by law and the State has not enacted legislation addressing 
the problem, the Privacy Rule, prior to the effective date of this 
final rule, would have prevented such disclosures by HIPAA covered 
entities that do not have hybrid entity status.\36\ Therefore, there 
are sufficient data demonstrating that HIPAA's disclosure restrictions 
can be a barrier to NICS reporting, and thus to the development of an 
accurate and comprehensive NICS database. The data support finalizing 
this modification to the Privacy Rule, which removes barriers while 
limiting the circumstances under which covered entities may disclose 
PHI to the NICS and limiting the types of PHI that may be disclosed.
---------------------------------------------------------------------------

    \36\ We note that at least three states have laws permitting, 
but not requiring the disclosure of mental health records to the 
NICS: Missouri, New Jersey and West Virginia. See Mo. Rev. Stat. 
630.140 (2013); N.J. Stat. Ann. 30:4-24.3 (2013); W.Va. Code 61-7A-3 
(2013).
---------------------------------------------------------------------------

    We know of one State in particular in which the Privacy Rule's 
disclosure restrictions posed challenges for NICS reporting. The State 
of New York had a statute requiring mental health facilities in the 
State to report NICS data to the State mental health agency, the 
State's designated repository of NICS data.\37\ As a result, the 
Privacy Rule permitted such disclosures to the repository as required-
by-law disclosures. However, the statute did not expressly require the 
mental health agency, which was a covered entity under HIPAA that did 
not have hybrid entity status, to report the data it collected to the 
NICS; the Privacy Rule thus did not permit the agency to disclose this 
data. Ultimately, the legislature needed to revise the statute to 
expressly require the agency to report the data to the NICS.\38\
---------------------------------------------------------------------------

    \37\ 2008 N.Y. Laws 491, codified at N.Y. Mental Hyg. Sec. Sec.  
7.09(j); 13.09(g), 31.11(5), 33.13(b), (c) (2011); N.Y. Jud. Ct. 
Acts Sec.  212(q) (2011).
    \38\ NY Secure Ammunition and Firearms Enforcement (SAFE) Act of 
2013.
---------------------------------------------------------------------------

    In addition to removing barriers, an additional benefit of the rule 
as described more fully below is that it provides clarity about the 
applicability of the Privacy Rule and its relationship to State law in 
this area, as well as provides an avenue for NICS reporting that may 
obviate the need to enact legislation at the State level.
    Comment: One commenter requested that the Department clarify how 
HIPAA's preemption provisions would apply to State laws requiring or 
prohibiting covered entities' disclosures of NICS data.
    Response: We clarify that this final rule does not change HIPAA's 
existing preemption provisions, which provide that the HIPAA rules 
preempt contrary State laws (with certain exceptions, such as where the 
contrary provision of State law is more stringent than the HIPAA 
provision).\39\ Accordingly, because the Privacy Rule, as modified by 
this final rule, only permits (but does not require) the disclosure for 
NICS reporting purposes, State laws that prohibit such disclosures are 
not contrary to the Privacy Rule, and covered entities in States with 
such laws remain subject to any applicable prohibitions against the 
disclosures under State law. That is, the covered entity could comply 
with both HIPAA and such State law by not disclosing PHI to the NICS.
---------------------------------------------------------------------------

    \39\ See 45 CFR 160.203.
---------------------------------------------------------------------------

    Moreover, HIPAA contains an express permission for disclosures that 
are required by other law, such as State law. Accordingly, State laws 
that require disclosures, for any purposes, remain in effect, as such 
laws are not contrary to the Privacy Rule.
    Comment: One commenter expressed concern that the rule would create 
an opportunity for the abuse of private information, for example, by 
allowing the government to disarm political dissidents who seek mental 
health care,

[[Page 393]]

or making it possible for medical personnel to abuse their authority 
and remove an individual's rights for illegitimate reasons.
    Response: Concerns about governmental or private actors taking 
advantage of this permission to target vulnerable persons are addressed 
by the procedural framework built into the statute that established the 
Federal mental health prohibitor and its implementing regulations, 
which this final rule does not change. As we previously have noted, the 
Federal mental health prohibitor, which makes an individual reportable 
to the NICS, applies only to the extent that the individual is 
involuntarily committed or determined by a court, board, commission, or 
other lawful authority to be a danger to self or others, or is unable 
to manage his or her own affairs due to a mental illness or condition. 
\40\ These involuntary commitments and other adjudications are not made 
independently by individual health care providers without any form of 
official legal review.
---------------------------------------------------------------------------

    \40\ 18 U.S.C. 922(g)(4); 27 CFR 478.11.
---------------------------------------------------------------------------

    Comments: Some commenters expressed concern that, by relaxing 
HIPAA's privacy requirements, the proposed rule could result in 
increased disclosures of private health information to the government. 
Several commenters argued that the Federal government has a poor record 
on protecting individuals' privacy and should not be entrusted with 
health information. In contrast, another commenter noted that Federal 
law, including the Privacy Act, prohibits access to the information in 
the NICS database outside of the limited purposes authorized by law, 
and information about specific firearms transfers is destroyed the day 
after the transaction.
    Response: We agree that it is important to protect the privacy and 
security of the information that is reported to the NICS and we note 
that the NICS is subject to specific privacy and security 
protections.\41\ In addition, we again emphasize that only very limited 
information may be disclosed under this rule, and disclosures of 
diagnostic or clinical information are expressly prohibited.
---------------------------------------------------------------------------

    \41\ See 63 FR 58303 (October 30, 1998), codified at 28 CFR part 
25.
---------------------------------------------------------------------------

    Comment: Finally, one commenter requested clarification on whether, 
in States where a covered entity is also a lawful authority that orders 
involuntary commitments or conducts other adjudications that make 
individuals subject to the Federal mental health prohibitor, there is 
intended to be a separation between the covered entity and lawful 
authority functions of the entity.
    Response: We note that, under the Privacy Rule, both before and 
after the modification made in this final rule, a covered entity could 
provide for such separation by operating as a hybrid entity, and 
disclose information through its non-HIPAA covered NICS reporting unit. 
However, it is our understanding that some covered entities may be 
unable to achieve hybrid entity status for administrative or other 
reasons. This is another reason for including the express permission 
described in the final rule.

VI. Regulatory Analyses

A. Introduction

    We have prepared a regulatory impact statement in compliance with 
Executive Order 12866 (September 1993, Regulatory Planning and Review), 
Executive Order 13563 (January 2011, Improving Regulation and 
Regulatory Review), the Regulatory Flexibility Act (RFA) (September 19, 
1980, Pub. L. 96-354), the Unfunded Mandates Reform Act of 1995 (UMRA) 
(March 22, 1995, Pub. L. 104-4), and Executive Order 13132 on 
Federalism.
1. Executive Order 12866 and Executive Order 13563
    Executive Orders 12866 and 13563 direct agencies to assess all 
costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). Executive 
Order 13563 emphasizes the importance of quantifying both costs and 
benefits, of reducing costs, of harmonizing rules, and of promoting 
flexibility. This rule has been designated a ``significant regulatory 
action'' although not economically significant, under section 3(f) of 
Executive Order 12866. Accordingly, this rule has been reviewed by the 
Office of Management and Budget.
    A regulatory impact analysis must be prepared for all major rules 
that have economically significant effects ($100 million or more in any 
one year) or adversely affect in a material way the economy, a sector 
of the economy, productivity, competition, jobs, the environment, 
public health or safety, or State, local, or tribal government or 
communities (58 FR 51741). Because the final rule does not contain any 
new requirements or prohibitions for covered entities, we estimate that 
the rule will be cost neutral. We did not receive public comments on 
this assumption or information indicating that covered entities will 
incur any costs as a result of the rule.
    Although we expect the economic impact of the rule, including non-
quantifiable costs and savings discussed in the regulatory analysis 
below, to be less than $100 million annually, we nevertheless conducted 
an analysis of the costs of the final rule.
2. Entities Subject to the Rule
    This final rule applies only to covered entities that function as 
repositories of information relevant to the Federal mental health 
prohibitor on behalf of a State or that are responsible for ordering 
the involuntary commitments or other adjudications that make an 
individual subject to the Federal mental health prohibitor. We do not 
have sufficient data to determine the number of affected entities, but, 
based on the information available to us, we believe there would be 
very few. Our understanding is that, for the most part, formal 
adjudications and repository functions of this nature are conducted by 
entities, such as court systems or law enforcement agencies, that are 
not covered by HIPAA. In addition, even covered entities in some states 
will not be affected because they currently do not face HIPAA barriers 
to reporting either because state law requires reporting or they have 
created hybrid entities, as described above in the preamble. We did not 
receive public comments on the number of covered entities that will be 
affected by this rule.

B. Why is this rule needed?

    This final rule is needed to ensure that, where HIPAA covered 
entities make adjudications causing individuals to become subject to 
the Federal mental health prohibitor, or serve as repositories of 
records of such adjudications on behalf of States, those covered 
entities can report the identities of those individuals to the NICS. 
This rule change can help further the important public safety goal of 
strengthening the background check system to ensure that individuals 
who are prohibited from purchasing or possessing firearms are not able 
to obtain them. Specific permission under the Privacy Rule for these 
disclosures is necessary to the extent that some States have not 
enacted laws requiring reporting to the NICS, but a covered entity in 
the State is nevertheless responsible for such reporting and does not 
become a hybrid entity. Importantly, the final rule permits only a 
small subset of HIPAA covered entities (i.e.,

[[Page 394]]

those that perform the relevant mental health adjudications or 
repository functions) to use or disclose only limited, non-clinical 
information, for NICS purposes. This narrowly tailored permission 
permits these important uses or disclosures for public safety to occur 
while maintaining a separation between reporting functions and the 
mental health treatment a patient might be receiving.

C. Qualitative Analysis of Unquantified Costs

    The rule is cost neutral with respect to HIPAA covered entities. 
The rule does not require entities that already have a NICS reporting 
process in place to change their current system and does not create new 
reporting or recordkeeping requirements for any covered entity. The 
small number of covered entities that are newly permitted to report to 
the NICS or a State repository under the rule can begin to report and 
may need to develop policies and procedures to do so. As the Privacy 
Rule only allows the use or disclosure of information, and does not 
require it, any resulting burden of reporting and associated procedures 
are attributable to the choice made by an entity to report information, 
the Federal statutory mental health prohibitor, and the NICS system 
itself. See 28 CFR part 25, subpart A. We acknowledge that those 
entities that choose to begin reporting may wish to address this change 
in their HIPAA policies and procedures, as well as explain their 
procedures to office staff. However, the rule does not require any 
changes to existing HIPAA policies and procedures. In addition, with 
respect to training, the rule does not require workforce training 
beyond what is already required under the HIPAA Privacy and Security 
Rules. We expect that entities that choose to report under the rule 
would also take steps to ensure that their office staff have copies of 
the new policies and procedures, which would not involve any 
significant additional costs. We did not receive public comments 
contradicting these assumptions or estimating the number of entities 
that might begin to report to the NICS for the first time, if any.
    To the extent that the rule permits some covered entities to report 
to the NICS for the first time, there may be an increase in the number 
of individuals whose identities are newly included in the NICS and who 
are denied a firearm transfer as a result. Therefore, there may be a 
concomitant increase in applications for ``relief from disabilities'' 
in states that provide such a relief program. However, any burden to 
individuals completing and submitting the relief application form is 
attributable to the Federal mental health prohibitor and the procedures 
established by the State where the commitment or adjudication occurred. 
The procedures for applying for relief in States that have established 
mental health prohibitor ``relief from disabilities'' programs pursuant 
to the NICS Improvement Amendments Act of 2007 vary.
    We received a number of comments on the NPRM asserting that 
creating an express permission in the Privacy Rule for NICS reporting 
would discourage individuals from seeking needed mental health care. We 
appreciate these concerns and agree with commenters who asserted that 
individuals' health and the public's safety are best served by 
encouraging appropriate treatment. We also recognize that discouraging 
treatment could increase the burden of untreated mental conditions to 
individuals, in the form of increased suffering and loss of 
productivity; to the health care system, when individuals with 
untreated mental illness need emergency hospitalization, for example; 
and to the public's safety. However, many of these commenters expressed 
the mistaken belief that the permission would allow or require most 
mental health care providers to report their patients to the NICS.
    As explained above, we have carefully and narrowly tailored the 
final rule to apply only to a small number of covered entities that may 
be responsible for the adjudications that make an individual subject to 
the Federal mental health prohibitor, or that serve as repositories of 
data about such adjudications. The rule generally maintains a 
separation between treatment functions and NICS reporting functions. In 
addition, the rule does not permit the use or disclosure of any 
diagnostic or clinical information, or any other information about an 
individual that is not needed for NICS reporting purposes. Because of 
these strict limitations on the permitted uses and disclosures, we 
believe that individuals will not be dissuaded from seeking needed 
mental health care services as a result of the rule.
    Finally, we recognize the intangible burden to individuals of the 
negative attitudes and misperceptions associated with mental health 
conditions. We note that the Federal mental health prohibitor does not 
apply to all individuals with mental health conditions, but instead to 
a subset of individuals who have been involuntarily committed or 
determined by a lawful authority to be a danger to themselves or 
others, or unable to manage their own affairs, as a result of marked 
subnormal intelligence, or mental illness, incompetency, condition, or 
disease. This rule permits a limited number of HIPAA covered entities 
to report to the NICS the identities of individuals in a particular 
subcategory of persons who are currently prohibited by Federal law from 
possessing firearms. This permission facilitates the enforcement of 
prohibitions that were established by the Gun Control Act. Therefore, 
we do not expect that this rule will exacerbate negative attitudes or 
misperceptions associated with mental health conditions.

D. Qualitative Analysis of Unquantified Benefits

    While we believe that there may be benefits to public safety as a 
result of the rule, we are not able to monetize the value of such 
benefits.
    For example, by removing a barrier to reporting, the rule may 
result in increased reporting to the NICS of individuals who may pose a 
risk of gun violence related to a serious mental health condition. To 
the extent that this rule permits covered entities to report those 
individuals' identities for NICS purposes, the rule provides a public 
safety benefit. One comment submitted in response to the NPRM noted 
that increased reporting could contribute to lowering the substantial 
financial costs of gun violence itself, which was estimated at $174 
billion in medical and lost productivity expenses in 2010.\42\ However, 
we do not have information about whether, or how many, covered entities 
would begin to report or increase reporting to the NICS as a result of 
the rule, nor do we have a basis for estimating the impact, if any, on 
the financial costs associated with gun violence.
---------------------------------------------------------------------------

    \42\ This comment cited Miller TR. The Cost of Firearm Violence. 
Children's Safety Network Economics and Data Analysis Resource 
Center, at Pacific Institute for Research and Evaluation, December 
2012.
---------------------------------------------------------------------------

    An additional benefit of the rule is that it provides clarity about 
the applicability of the Privacy Rule and its relationship to State 
law. Specifically, the rule alleviates the concerns of State lawmakers 
who, according to several commenters on the ANPRM, may be reluctant to 
pursue State legislation requiring entities to report Federal mental 
health prohibitor information for NICS purposes because of a 
misconception that the HIPAA Privacy Rule would preempt such 
requirements. As explained more fully above, the Privacy Rule permits 
uses and disclosures that are required by law, and

[[Page 395]]

thus would not preempt a State law requiring disclosures to NICS. 
However, to the extent that State lawmakers harbor this misconception, 
this preamble clarifies HIPAA's preemption provisions and the final 
rule provides an avenue for NICS reporting that may obviate the need to 
enact legislation at the State level.

E. Additional Regulatory Analyses

1. Regulatory Flexibility Act
    The RFA requires agencies to analyze and consider options for 
reducing regulatory burden if a rule will impose a significant burden 
on a substantial number of small entities. The Act requires the head of 
the agency either to certify that the rule will not impose such a 
burden or to perform a regulatory flexibility analysis and consider 
alternatives to lessen the burden. For the reasons explained more fully 
above in the summary of costs and benefits, it is not expected that the 
rule will result in compliance costs for covered entities of any size 
because the rule does not impose new requirements. Therefore, the 
Secretary certifies that the rule will not have a significant impact on 
a substantial number of small entities.
2. Unfunded Mandates Reform Act
    Section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA) 
requires that agencies assess anticipated costs and benefits before 
issuing any rule whose mandates would require spending in any one year 
$100 million in 1995 dollars, updated annually for inflation. In 2013, 
that threshold is approximately $141 million dollars. UMRA does not 
address the total cost of a rule. Rather, it focuses on certain 
categories of cost, mainly those ``Federal mandate'' costs resulting 
from: (1) Imposing enforceable duties on State, local, or Tribal 
governments, or on the private sector; or (2) increasing the stringency 
of conditions in, or decreasing the funding of, State, local, or Tribal 
governments under entitlement programs. As this rule does not impose 
enforceable duties or affect entitlement programs, UMRA does not 
require us to prepare an analysis of the costs and benefits of the 
rule. Nonetheless, we have done so in accordance with Executive Orders 
12866 and 13563, and present this analysis in sections C and D above.
3. Federalism
    Executive Order 13132 establishes certain requirements that an 
agency must meet when it promulgates a rule that imposes substantial 
direct requirement costs on State and local governments, preempts State 
law, or otherwise has Federalism implications.
    The Federalism implications of the HIPAA Privacy and Security Rules 
were assessed as required by Executive Order 13132 and published as 
part of the preambles to the final rules on December 28, 2000 (65 FR 
82462, 82797) and February 20, 2003 (68 FR 8334, 8373), respectively. 
This final rule does not impose requirements, or any associated costs, 
on State and local governments. Regarding preemption, the preamble to 
the final Privacy Rule explained that the HIPAA statute dictates the 
relationship between State law and Privacy Rule requirements. 
Therefore, the Privacy Rule's existing preemption provisions do not 
raise Federalism issues, and these provisions are not affected by this 
rule.
    One commenter argued that a permission for entities other than 
States to report to the NICS would bypass the decisions of the States 
regarding the submission of reports and, therefore, raises federalism 
implications. In response, we again emphasize that this rule does not 
require covered entities to make disclosures that are prohibited by 
State law, nor does it prevent disclosures required by State law. 
Further, States retain discretion to determine which entities within 
the State are authorized to report information to the NICS. For these 
reasons, the rule does not have Federalism implications.

F. Accounting Statement

    Whenever a rule is considered a significant rule under Executive 
Order 12866, we are required to develop an accounting statement 
indicating the costs associated with the rule. As explained above, we 
expect that the rule is cost neutral. We did not receive public 
comments on any unanticipated costs associated with the rule, including 
costs to covered entities that choose to amend written HIPAA policies 
and procedures or to provide additional training to staff.

VII. Collection of Information Requirements

    This final rule does not contain requests or requirements to report 
information to the government, nor does it impose new requirements for 
recordkeeping or disclosures to third-parties or the public. Therefore, 
the requirements of the Paperwork Reduction Act with respect to 
information collections do not apply.

List of Subjects in 45 CFR Part 164

    Administrative practice and procedure, Computer technology, 
Electronic information system, Electronic transactions, Employer 
benefit plan, Health, Health care, Health facilities, Health insurance, 
Health records, Hospitals, Medicaid, Medical research, Medicare, 
Privacy, Reporting and recordkeeping requirements, and Security.

    For the reasons set forth in the preamble, the Department of Health 
and Human Services amends 45 CFR Subtitle A, Subchapter C, part 164, as 
set forth below:

PART 164--SECURITY AND PRIVACY

0
1. The authority citation for part 164 continues to read as follows:

    Authority: 42 U.S.C. 1302(a); 42 U.S.C. 1320d-1320d-9; sec. 264, 
Public Law 104-191, 110 Stat. 2033-2034 (42 U.S.C. 1320d-2(note)); 
and secs. 13400-13424, Public Law 111-5, 123 Stat. 258-279.


0
2. Amend Sec.  164.512 by adding paragraph (k)(7) to read as follows:


Sec.  164.512  Uses and disclosures for which an authorization or 
opportunity to agree or object is not required.

* * * * *
    (k) * * *
    (7) National Instant Criminal Background Check System. A covered 
entity may use or disclose protected health information for purposes of 
reporting to the National Instant Criminal Background Check System the 
identity of an individual who is prohibited from possessing a firearm 
under 18 U.S.C. 922(g)(4), provided the covered entity:
    (i) Is a State agency or other entity that is, or contains an 
entity that is:
    (A) An entity designated by the State to report, or which collects 
information for purposes of reporting, on behalf of the State, to the 
National Instant Criminal Background Check System; or
    (B) A court, board, commission, or other lawful authority that 
makes the commitment or adjudication that causes an individual to 
become subject to 18 U.S.C. 922(g)(4); and
    (ii) Discloses the information only to:
    (A) The National Instant Criminal Background Check System; or
    (B) An entity designated by the State to report, or which collects 
information for purposes of reporting, on behalf of the State, to the 
National Instant Criminal Background Check System; and
    (iii)(A) Discloses only the limited demographic and certain other 
information needed for purposes of reporting to the National Instant 
Criminal Background Check System; and

[[Page 396]]

    (B) Does not disclose diagnostic or clinical information for such 
purposes.
* * * * *

    Dated: December 30, 2015.
Sylvia M. Burwell,
Secretary.
[FR Doc. 2015-33181 Filed 1-4-16; 4:15 pm]
BILLING CODE 4153-01-P