It's probably not much different. From cursory research, it looks like HIPAA has been challenged before and upheld under the Commerce Clause. This may survive a challenge as well, but tying it to federal funding avoids the inevitable litigation over constitutionality.
Congress doesn't have the Constitutional authority to directly require this of local hospitals and physicians, so they have to use the end-around of tying it to federal funding.
In most cases, this limitation on Congress is probably a good thing.
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It's probably not much different. From cursory research, it looks like HIPAA has been challenged before and upheld under the Commerce Clause. This may survive a challenge as well, but tying it to federal funding avoids the inevitable litigation over constitutionality.
Congress doesn't have the Constitutional authority to directly require this of local hospitals and physicians, so they have to use the end-around of tying it to federal funding. In most cases, this limitation on Congress is probably a good thing.