AMA welcomes decision supporting new legislation clarifying Red Flags Rule

A federal appeals court issued a decision March 4 that further validates the AMA’s long-standing argument to the Federal Trade Commission (FTC) that physicians who bill after rendering services are not subject to the red flags rule as creditors. The U.S. Court of Appeals for the District of Columbia Circuit found the present regulations of the FTC invalid in light of the Red Flag Program Clarification Act of 2010, passed by Congress last December to shed much needed light on who is considered a creditor under the red flags rule. The court issued the judgment in a lawsuit filed by the American Bar Association challenging the application of the red flags rule to attorneys. The AMA has worked closely with FTC officials and Congress and is engaged in a lawsuit with other physician groups to challenge the FTC’s efforts to extend the red flags rule to all physicians. The lawsuit, filed by the Litigation Center of the AMA and the State Medical Societies, the American Osteopathic Association and the Medical Society of the District of Columbia and joined by 26 national medical specialty societies, will now formally end.