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The Department of Health and Wellness

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The Department of Health and Wellness

The department of health and wellness in your state is developing a new computer system for processing individual and family insurance claims. The new system features direct data input and inquiry capabilities. Identification of patients claiming insurance is provided by using the health number for individuals. The new system should be fully implemented in time for the coming flu season this fall.

The new system will serve three primary purposes:

1. Data will be input directly into the system from insurance claims using computer terminals located at department headquarters. [send email about insurance paper process]

2. The returns will be processed using the main computer facilities at department headquarters. Processing will include four steps:

a. Verifying mathematical accuracy

b. Auditing the reasonableness of claims, through the use of edit routines, which also include a comparison of current and prior years' data.

c. Identifying claims that should be considered for audit by department of health agents

d. Issuing insurance claim proceeds to patients

3. Inquiry service will be provided to patients upon request through the assistance of the health department personnel at five regional offices. A total of 40 terminals will be placed at each regional office. A patient will be allowed to determine the status of his or her claim or get information from the last three years' returns by calling or visiting one of the department's regional offices.

The state commissioner of health is concerned about data security during input and processing, over and above protection against natural hazards such as fire and flood. This includes protection against the loss or damage of data during data input and processing as well as the improper input or processing of data. In addition, the health commissioner and the state attorney general have discussed the general problem of data confidentiality that may arise from the nature and operation of the new system. Both individuals want to have potential problems identified before the system is fully developed and implemented so that the proper controls can be incorporated into the new system.

REQUIRED

1. Describe the potential confidentiality problems that could arise in each of the following three areas of processing, and recommend the corrective action (s) to solve each problem identified:

a. Data input

b. Processing of returns

c. Data inquiry

2. The state

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