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Recent HIPAA Breach Settlements - Lessons Learned

Client Alert
June 19, 2023

As a healthcare provider, you are likely familiar with the Health Insurance Portability and Accountability Act (HIPAA). But, do you know how serious the consequences could be for a breach of HIPAA? According to the U.S. Department of Health and Human Services’ (HHS) Office for Civil Rights (OCR), the consequences for providers may include settlements of $30,000 to $240,000. OCR recently released two settlements for improper breaches of protected health information (PHI) that are good examples of the major monetary penalties that can result from common HIPAA mistakes.

Disclosing PHI in Responses to Negative Reviews

In April 2020, a health care provider in New Jersey impermissibly disclosed the PHI (including information on diagnoses and treatment) of its patients in response to negative online reviews. OCR investigated following a complaint from the patient and found that the provider impermissibly disclosed patient PHI and failed to implement policies and procedures with respect to protected information. On June 5, 2023, the provider agreed to pay $30,000 to OCR to settle the complaint. Additionally, the provider agreed to implement a corrective action plan to resolve potential violations. The plan included a few of the following steps:

  • Train all members on the organization’s policies and procedures to comply with HIPAA Privacy;
  • Issue breach notices to all whose PHI was disclosed on any internet platform without valid authorization; and
  • Submit a breach report to HHS on individuals whose PHI was disclosed on any internet platform without valid authorization.

In response to the complaints, OCR Director Melanie Fontes Rainer stated, “OCR continues to receive complaints about health care providers disclosing their patients’ protected health information on social media or on the internet in response to negative reviews.” They added, “[s]imply put, this is not allowed.”

Snooping by Security Guards

On June 15, 2023, a Washington hospital paid $240,000 to settle its HIPAA breach affecting 419 individuals. Following a breach notification report filed by the hospital, OCR investigated and found that 23 of the hospital’s security guards impermissibly accessed the medical records of hundreds of patients without a job-related purpose. The guards accessed information including names, dates of birth, medical record numbers, addresses, certain notes related to the treatment, and insurance information.

In addition to a $240,000 settlement, the hospital was required to implement a plan to update its policies and procedures to safeguard PHI and prevent its workforce members from snooping in the future. Further, the hospital was to be monitored for two years by the OCR to ensure its compliance with the HIPAA Security Rule. The hospital agreed to take the following steps, among others, to bring it into HIPAA compliance:

  • Conduct a risk analysis to determine risks and vulnerabilities to electronic PHI;
  • Develop and implement a risk management plan to address and mitigate identified security risks and vulnerabilities identified in the risk analysis; and
  • Enhance its existing HIPAA and Security Training Program to provide workforce training on updated HIPAA policies and procedures.

“Data breaches caused by current and former workforce members impermissibly accessing patient records are a recurring issue across the healthcare industry. Healthcare organizations must ensure that workforce members can only access the patient information needed to do their jobs,” Fontes Rainer stated. “HIPAA covered entities must have robust policies and procedures in place to ensure patient health information is protected from identity theft and fraud.”

HIPAA breaches are to be taken very seriously. It is imperative for health care providers to have current HIPAA compliance plans, trainings, and breach protocols. For questions, or to update your HIPAA compliance plan, please reach out to attorney Ashley Watson at abwatson@bmdllc.com or any members of the BMD Healthcare Team.

HIPAAHIPAA ComplianceHealth Law
Client Alert

Changes to FFCRA Paid Leave: Congress’ Revisions to Employment COVID-19 Leave Benefits Signals the Light is at the End of the Tunnel

December 28, 2020Late in the evening on December 27th, President Trump signed into law the government’s $900 billion COVID-19 relief package (the “Stimulus Bill”). Among other economic stimulus benefits, the Stimulus Bill contains the $600 stimulus checks that will be issued to eligible individuals as well as, relevantly, changes to the Families First Coronavirus Response Act (“FFCRA”). The FFCRA was implemented in April 2020 and provided benefits to individuals who missed work as a result of an actual or suspected COVID-19 illness or to care for a child when their school or childcare service was closed because of COVID-19. Importantly, the Stimulus Bill extends eligibility for employer payroll tax refunds for leave payments made to employees on or before March 31, 2021 under the FFCRA, signaling to the American people that Congress believes many of the employed public will be vaccinated by this time, the light at the end of the tunnel. However, the Stimulus Bill does contain a caveat that employers are no longer required to provide FFCRA leave benefits after December 31, 2020, but if they do, they will receive the payroll tax credits, up to the maximums provided in the FFCRA, for payments made prior to April 1, 2021. Below we provide a list of questions and answers we received to date following the passage of the Stimulus Bill. We expect the U.S. Department of Labor (“DOL”) to issue additional questions and answers as the Stimulus Bill is implemented, and we will update this Client Alert as these are received.Client Alert

Healthcare Speaker Programs: New OIG Alert

December 11, 2020In a rare Special Fraud Alert issued on November 16, 2020 (the “Alert”), the Office of Inspector General (“OIG”) urged companies who host speaker programs to reassess their programs in light of the “inherent risks” associated with these activities. The Alert reports that, in the last three years, drug and device companies have reported paying nearly $2 billion to health care professionals for speaker-related services.Client Alert

Value-Based Care Advances – CMS Issues New Final Rules for Stark and Anti-Kickback Statutes

December 11, 2020The Centers for Medicare & Medicaid Services (“CMS”) and the Department of Health and Human Services (“HHS”) Office of the Inspector General (“OIG”) issued two highly anticipated (and quite extensive) Final Rules to reform the Stark Law and Anti-Kickback Statute (“AKS”) regulations. The Final Rules generally take effect on January 19, 2021. The Final Rules include new safe harbors for the AKS and new exemptions to the Stark Law to allow for greater flexibility. According to the HHS, the goal of updating both laws is to make it easier for providers to engage in care coordination and value-based care programs without running afoul of the statutes. Please note that this client alert could not cover the full extent of the Final Rule changes so please contact your BMD Healthcare attorney with questions.Client Alert

Mandatory Filings Under CFIUS New Rules

December 11, 2020On September 15, 2020, the Committee on Foreign Investment in the United States (“CFIUS”) promulgated a final rule modifying its mandatory declaration requirements for certain foreign investment transactions involving “TID US businesses” (sensitive U.S. businesses dealing in critical technologies, critical infrastructure and sensitive personal data) dealing in “critical technologies” – i.e., U.S. businesses that produce, design, test, manufacture, fabricate, or develop one or more critical technologies. The new rule also makes amendments to the definition of the term “substantial interest” (used to determine whether a foreign government has a substantial interest in an entity). The final rule became effective on October 15, 2020.Client Alert

IRS Guidance on Employee Retention Credit

December 11, 2020The Employee Retention Credit created under Section 2302 of the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act is a refundable tax credit against certain employment taxes equal to 50 percent of the qualified wages an eligible employer pays to employees after March 12, 2020, and before January 1, 2021. Since the adoption of the CARES Act, employers have expressed concern that if one employer acquires another employer that previously received a PPP loan, the acquirer’s entire aggregated group may no longer be eligible to claim the Employee Retention Credit.
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