At the end of 2017, the OCR logged just under $20 million in fines for HIPAA violations from 10 enforcement actions with monetary penalties. In 2016, the total in penalties was roughly the same amount but from 15 organizations.
Here is an overview of the resolution agreements and enforcement actions with civil monetary penalties from 2017:
Lessons from 2017
Devices, devices, devices . . .
Quite a number of cases involved failure to implement safeguards for PHI on mobile devices. The best fix is to superglue devices to staff. Short of doing that, organizations should recognize that mobile devices frequently get lost or stolen, so there should be heightened security controls when PHI is accessible on these devices.
Several cases involved failing to provide timely notice or to act promptly after problems were discovered. In politics, it’s often not the scandal, but the coverup that fells politicians. In the world of HIPAA, it’s often not the incident, but the response that leads to organizations being penalized.
Recently, HIPAA enforcement over data breaches is increasing – a lot. This year has seen some of the largest monetary penalties. Why is this happening?
I had the chance to interview Katherine Keefe, who leads the Beazley Breach Response (BBR) Services Group. I am particularly interested in the insurer’s perspective, so I interviewed Katherine.
The first quarter of 2017 is not yet over and the OCR has already released details of four enforcement penalties totaling over $11 million. 2016 set a record with $20 million in fines for the year, with $5.2 million of that coming in the first quarter. In just the first 2 months of 2017, the fines have been more than half what the entire amount for 2016 was. Here are details about enforcement actions in 2017 thus far:
- Illinois health care network, Presence Health, was fined $475,000 for failing to notify patients of a breach within the 60-day period. The incident took place over 3 years ago. In October 2013, operating room schedules that were written on paper and contained PHI of 836 individuals went missing. Patients were not notified of the breach until February of 2014. This represents the first enforcement related to the timeliness of breach notification.
- An insurance company, MAPFRE, was fined $2.2 million for failure to safeguard portable devices and poor risk assessment and risk management. OCR found that MAPFRE did not have an adequate security awareness training program in place for their workforce. In 2011, an unsecured USB device containing the ePHI of 2,209 individuals was stolen from the company’s IT department. Despite the corrective measures MAPFRE indicated it would take, it did not actually start securing portable devices until 3 years after the incident.
- Children’s Medical Center of Dallas received a $3.2 million fine for multiple incidents where devices with unsecured ePHI were stolen. In 2010 an unencrypted Blackberry was stolen with the ePHI of 3,800 individuals. In 2013, an unencrypted laptop was stolen with ePHI of 2,463 individuals. The OCR investigation discovered that the hospital did not begin to secure and safeguard workstations and portable devices until 2013 despite being aware of the risks for many years.
- Florida corporation, Memorial Healthcare System, agreed to pay a fine of $5.5 million. This ties Advocate Health Care Network’s fine in August of 2016 for the record of highest penalty. In this incident, the PHI of 115,143 patients was improperly accessed and disclosed. Memorial Healthcare failed to terminate a former employee’s log-in credentials which was then used to access 80,000 records with PHI over the course of an entire year. The company also neglected to review the activity within the system that would have identified that the records were being improperly accessed. Memorial discovered the breach while investigating two employees who were stealing patient information to file fake tax returns.
Not too long ago, I posted an overview of OCR’s enforcement in 2016. OCR continues to be active in its enforcement, at its highest level to date. This is a great opportunity for privacy and security officials to point out to upper management the need for greater resources and attention to HIPAA compliance.
Time to call the Guinness Book of World Records because HHS has set a new world record in HIPAA enforcement. 2016 saw a considerable increase in HIPAA enforcement resolution agreements and monetary penalties. At the end of 2016, the OCR logged over $20 million in fines for HIPAA violations from 15 enforcement actions with monetary penalties — a stark contrast to 2015 penalties which were just over $6 million from just 6 resolution agreements.
The per entity fines have increased as well increasing from about $850K in recent years to $2 million in 2016.
Also, in late 2015, the Office of the Inspector General released findings of a study that recommended a stronger enforcement and follow-up from the OCR for HIPAA violations:
By Daniel J. Solove
Co-authored with Professor Paul Schwartz
This post is part of a post series where we round up some of the interesting news and resources we’re finding. We have split the health/HIPAA material from our updates on other topics. To see our updates for other topics, click here.
For a PDF version of this post, and for archived issues of previous posts, click here.
By Daniel J. Solove
When you go to the hospital, you might worry about catching a staph infection or pneumonia, but you should also worry about contracting a nasty case of medical identity theft. Most people suffer significant harm from medical ID theft, and few are completely cured. This ailment is spreading dramatically as data spurts out of healthcare organizations these days as if from a ruptured aorta.
In January of this year, an article citing U.S. Department of Health and Human Services (HHS) statistics noted that in the past 5 years, there have been roughly 120,000 reported data breaches involving HIPAA protected health information. These breaches have involved more than 31 million individuals.
by Daniel J. Solove
Are privacy and security laws being enforced effectively? This post is post #5 of a series called Enforcing Privacy and Security Laws.
Under the Health Insurance Portability and Accountability Act (HIPAA), various organizations can be randomly selected to be audited – even if no complaint has been issued against them and even if there has been no privacy incident or breach.
What the audits thus far have revealed is quite alarming. I’ll discuss more on that later.
by Daniel J. Solove
Are privacy and security laws being enforced effectively? This post is post #4 of a series called Enforcing Privacy and Security Laws.
The Health Insurance Portability and Accountability Act (HIPAA) regulations govern health information maintained by various entities covered by HIPAA (“covered entities”) and other organizations that receive health information from covered entities when performing functions for them. HIPAA is enforced by the Office for Civil Rights (OCR) in the Department of Health and Human Services (HHS). Additionally, state attorneys general (AGs) may enforce HIPAA – only a few federal privacy laws can also be enforced by state AGs.