Duh, because some in the medical establishment were selling your information to outside marketing firms without your knowledge. Increasing computerization of records was only going to make more abuses possible. There were no federal laws protecting your right to medical privacy until HIPAA was passed in the late ninties. Everyone has been bellyaching about the regulations being written by Health & Human Services since.
Of course someone could sue and probably win without this law but once that happens then you are not goign to see one doctor being willing to share information with another doctor for fear of being sued. HIPAA establishes for all what is and is not allowed and what safeguards need to be in effect. Most of us think this is pretty good idea. But i guess for you folks who think the only functions of government are to protect the borders and ensure your right to buy and sell drugs, its probably a bummer.
Regardless of which side of the issue is right, does the executive branch actually have constitutional authority to be even making such decisions?