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Enhancing Privacy Protections for Substance Use Disorder Patient Records

Client Alert
February 16, 2024

On February 8, 2024, the U.S. Department of Health and Human Services (“HHS”) finalized updated rules to 42 CFR Part 2 (“Part 2”) for the protection of Substance Use Disorder (“SUD”) patient records. The updated rules reflect the requirement that the Part 2 rules be more closely aligned with the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”) privacy, breach notification, and enforcement rules as mandated by the Coronavirus Aid, Relief, and Economic Security Act of 2020.

Part 2 protects the SUD treatment records of patients who are treated at a Part 2 program. Part 2 programs are those that are (1) federally assisted (they receive federal funding) and (2) hold themselves out as providing, and do provide, substance use disorder diagnosis, treatment, or referral for treatment. The final rules released by HHS this month reflect the inclusion of the public comments from providers, trade associations, health information exchanges, health plans and others.

The final rules make the following modifications to Part 2 regulations, effective February 16, 2026:

  • Patient Consent: One single Part 2 consent will be sufficient for all future disclosures for payment, treatment, and health care operations. All disclosures made with patient consent must include a copy of the consent or a clear explanation of the scope of consent. Previously, a separate consent was needed for each disclosure of Part 2 information. However, the final rules do retain a prohibition on the use of Part 2 records in legal proceedings and testimony in civil, criminal, administrative, and legislative proceedings against a patient without specific consent or a court order.
  • Counseling Notes: Like HIPAA psychotherapy records, a separate patient consent for the use and disclosure of SUD counseling notes is now required. SUD counseling notes include those analyzing the conversation in a SUD counseling session that the clinician voluntarily maintains separately from the rest of the patient’s SUD treatment and medical record.
  • Patient Notice: Part 2 patient notice requirements now align with the requirements of the HIPAA Notice of Privacy Practices.
  • Redisclosure: HIPAA covered entities and business associates that receive records under a Part 2 consent may redisclose those records according to HIPAA regulations. Previously, Part 2 regulations required a specific disclosure that was stricter than HIPAA redisclosure regulations.
  • Public Health: Part 2 records may now be disclosed to public health authorities without patient consent as long as the records are de-identified.
  • Breach Notification: The HIPAA Breach Notification Rule requirements will also apply to breaches of records under Part 2.
  • Segregation of Part 2 Data: Part 2 records are no longer required to be segregated or segmented from other medical records.
  • Fundraising: Patients will be able to opt out of receiving fundraising communications from Part 2 programs.
  • Complaints: Patients will have a right to file a complaint directly with the Secretary of HHS for an alleged violation of Part 2 in addition to filing a complaint with the Part 2 program.
  • Penalties: Part 2 penalties will be aligned with HIPAA by replacing criminal penalties currently in Part 2 with civil and criminal enforcement authorities that also apply to HIPAA violations.

The text of the final rule can be found on the Federal Register. All Part 2 programs must comply with the new requirements by February 16, 2026. The BMD healthcare team can help ensure that you are compliant. Please reach out to Daphne Kackloudis (dlkackloudis@bmdllc.com) or Jordan Burdick (jaburdick@bmdllc.com) for questions or assistance.

Health LawHealthcare Policysubstance abuseDaphne KackloudisJordan Burdick
Client Alert

New State Budget Institutes Licensure Requirement for Ohio’s Hospitals

July 14, 2021On July 1, 2021, Governor Mike DeWine signed Ohio’s final budget codified at Ohio Revised Code 3722.01 et seq., which includes a new licensing requirement for Ohio’s hospitals. For years, Ohio was the only state in the country that did not license its hospitals. This approach will now be replaced with new, detailed requirements that will require careful review and compliance. Here are some of the highlights concerning these new changes:Client Alert

Healthcare Provisions in the Ohio FY 22-23 Budget

July 13, 2021Governor Mike DeWine signed Ohio’s Fiscal Year 2022-2023 budget bill (HB 110) into law on July 1, 2021. At almost 1,000 pages and 74.1 billion dollars, the budget lays out the State’s spending for the next two years. Below are a few highlighted provisions from the budget that will be important for the healthcare industry in OhioClient Alert

Interim Final Rule for Surprise Billing

July 12, 2021In an effort to implement the new bipartisan No Surprises Act, on July 1, 2021, the Department of Health and Human Services (HHS), along with the Departments of Labor and Treasury, issued an interim final rule to safeguard patients against unforeseen medical bills arising from out-of-network care.Client Alert

President Biden Seeks to Limit Non-Compete Agreements

July 8, 2021Today, President Biden announced he would issue an Executive Order that calls on the Federal Trade Commission (FTC) to adopt rules to curtail worker non-compete agreements. Interestingly, a week ago, the FTC approved changes to its Rules of Practice to modernize and expedite the way it issues Trade Regulation Rules. If you have followed our alerts, we predicted the elimination of non-competes would probably happen. In 2016, then-Vice President Biden was a vocal opponent against non-compete agreements. He led the Obama administration’s initiative seeking to limit or eliminate non-compete agreements. In his presidential campaign, Biden promised to “work with Congress to eliminate all non-compete agreements, except the very few that are absolutely necessary to protect a narrowly defined category of trade secrets . . ..”Client Alert

New NIL Opportunities for Student-Athletes Require Diligent Review

July 8, 2021On June 28, 2021, Governor Mike DeWine signed Executive Order 2021-10D, “Establishing the Duties of Colleges and Universities as to Name, Image, and Likeness Compensation of Student-Athletes.” The Executive Order was motivated by the passage of similar name, image, and likeness (“NIL”) regulations in seventeen (17) other states; Ohio followed suit to avoid a significant competitive disadvantage in attracting student-athletes to the state.
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