HIPAA Breach Notification Rule

HIPAA Breach Notification

HIPAA Breach Notification Rule:- The Health Insurance Portability and Accountability Act (HIPAA) Breach Notification Rule is a critical component of healthcare compliance in the United States, mandating that covered entities and their business associates promptly notify affected individuals, the Department of Health and Human Services (HHS), and, in certain cases, the media, following a breach of unsecured protected health information (PHI). Understanding and adhering to this rule is essential for maintaining patient trust and avoiding substantial penalties.

Understanding the HIPAA Breach Notification Rule

Enacted as part of the HITECH Act in 2009, the HIPAA Breach Notification Rule requires covered entities—such as healthcare providers, health plans, and healthcare clearinghouses—and their business associates to provide notification following a breach of unsecured PHI. Unsecured PHI refers to information that has not been rendered unusable, unreadable, or indecipherable to unauthorized individuals through methods like encryption or destruction.

Defining a Breach

A breach is generally defined as the acquisition, access, use, or disclosure of PHI in a manner not permitted under the HIPAA Privacy Rule, which compromises the security or privacy of the PHI. However, there are exceptions to this definition, including:

  • Unintentional Access by Workforce Members: If a workforce member unintentionally accesses PHI in good faith and within the scope of their authority, and the information is not further used or disclosed improperly.
  • Inadvertent Disclosures Between Authorized Individuals: If an authorized individual inadvertently discloses PHI to another authorized person within the same organization, and the information is not further used or disclosed improperly.
  • Good Faith Belief That the Unauthorized Person Cannot Retain Information: If the covered entity or business associate believes in good faith that the unauthorized person who received the PHI would not have been able to retain the information.

Also Read: 2025 Outlook: Where the Dollars are flowing for Healthcare Deals

Risk Assessment

When a potential breach occurs, the covered entity or business associate must conduct a risk assessment to determine the probability that the PHI has been compromised. This assessment considers factors such as:

  • The Nature and Extent of PHI Involved: Including the types of identifiers and the likelihood of re-identification.
  • The Unauthorized Person Who Used or Disclosed the PHI: Or to whom the disclosure was made.
  • Whether the PHI Was Actually Acquired or Viewed: Or if only the opportunity existed.
  • The Extent to Which the Risk to PHI Has Been Mitigated: For example, through assurances that the information will not be further used or disclosed.

If the risk assessment indicates that there is a low probability that the PHI has been compromised, breach notification may not be required. However, if it is determined that the PHI has been compromised, notifications must be issued promptly.

Notification Requirements

  1. Individual Notification: Covered entities must notify affected individuals without unreasonable delay and no later than 60 calendar days after the discovery of the breach. Notifications should be written in plain language and include:
    • A brief description of the breach.
    • The types of PHI involved.
    • Steps individuals should take to protect themselves.
    • What the covered entity is doing to investigate, mitigate harm, and prevent future breaches.
    • Contact information for individuals to ask questions or learn additional information.
  2. Notification to HHS: The timing of notification to the Secretary of HHS depends on the number of individuals affected:
    • Breaches Affecting 500 or More Individuals: Must be reported to HHS without unreasonable delay and no later than 60 calendar days from the discovery of the breach.
    • Breaches Affecting Fewer Than 500 Individuals: May be reported to HHS on an annual basis, no later than 60 days after the end of the calendar year in which the breaches were discovered.
  3. Media Notification: For breaches affecting more than 500 residents of a state or jurisdiction, covered entities must notify prominent media outlets serving that area without unreasonable delay and no later than 60 calendar days after discovery.
  4. Business Associate Notification: Business associates must notify the covered entity of a breach without unreasonable delay and no later than 60 calendar days after discovery. The notification should include identification of affected individuals and any other pertinent information to assist the covered entity in fulfilling its notification obligations.

Recent Breach Incidents and Regulatory Responses

The healthcare sector has witnessed significant data breaches in recent years, underscoring the importance of robust compliance with the HIPAA Breach Notification Rule. For instance, in 2024, UnitedHealth Group’s technology unit experienced a cyberattack that compromised the personal information of approximately 190 million individuals, marking one of the largest healthcare data breaches in U.S. history.

In response to such incidents, the U.S. Department of Health and Human Services’ Office for Civil Rights (OCR) has proposed new cybersecurity requirements for healthcare organizations. These proposed rules aim to enhance the protection of patient data by mandating measures such as multifactor authentication, network segmentation, and data encryption. The goal is to mitigate the impact of cyberattacks and ensure the confidentiality, integrity, and availability of PHI.

Penalties for Non-Compliance

Failure to comply with the HIPAA Breach Notification Rule can result in substantial penalties, including:

  • Civil Penalties: Ranging from $100 to $50,000 per violation, with an annual maximum of $1.5 million, depending on the level of negligence.
  • Criminal Penalties: For knowingly obtaining or disclosing PHI in violation of HIPAA, penalties can include fines and imprisonment.

Best Practices for Compliance

To ensure compliance with the HIPAA Breach Notification Rule, covered entities and business associates should consider implementing the following best practices:

  1. Develop and Implement Comprehensive Policies and Procedures: Establish clear policies and procedures for identifying, reporting, and responding to breaches of unsecured PHI.
  2. Conduct Regular Risk Assessments: Perform periodic risk assessments to identify potential vulnerabilities in the handling of PHI and implement appropriate safeguards to mitigate identified risks.
  3. Provide Ongoing Training and Education: Ensure that all workforce members receive regular training on HIPAA requirements, including the Breach Notification Rule, to promote awareness and compliance.
  4. Implement Technical Safeguards: Utilize encryption, access controls, and other technical measures to protect PHI from unauthorized access or disclosure.
  5. Establish Incident Response Plans: Develop and maintain incident response plans that outline the steps to be taken in the event of a breach, including notification procedures and mitigation strategies.

Frequently Asked Questions

Q1: What is the HIPAA Breach Notification Rule?

The HIPAA Breach Notification Rule mandates that covered entities and their business associates notify affected individuals, the Department of Health and Human Services (HHS), and, in certain cases, the media, following a breach of unsecured protected health information (PHI).

Q2: What constitutes a breach under this rule?

A breach is defined as the acquisition, access, use, or disclosure of PHI in a manner not permitted by the HIPAA Privacy Rule, which compromises the security or privacy of the PHI.

Q3: Who must be notified in the event of a breach?

Affected individuals, the HHS Secretary, and, for breaches involving more than 500 residents of a state or jurisdiction, prominent media outlets serving that area must be notified.

Q4: What is the timeframe for providing notifications?

Notifications must be provided without unreasonable delay and no later than 60 days following the discovery of a breach.

Q5: What information should be included in the notification to individuals?

The notification should include a brief description of the breach, the types of information involved, steps individuals should take to protect themselves, what the entity is doing to investigate and mitigate the breach, and contact information for further inquiries.

Q6: Are there penalties for failing to comply with the Breach Notification Rule?

Yes, non-compliance can result in substantial penalties, including civil and criminal penalties, depending on the level of negligence.

Conclusion

The HIPAA Breach Notification Rule plays a vital role in safeguarding the privacy and security of individuals’ health information. By understanding the requirements of the rule and implementing robust compliance measures, covered entities and business associates can protect patient trust, avoid substantial penalties, and contribute to the overall integrity of the healthcare system.

So, You Want to Open Your Own Veterinary Practice?

As a veterinarian, the dream of owning your own practice often represents the pinnacle of professional achievement. However, venturing into practice ownership is a monumental decision that requires thorough preparation and strategic planning. Here’s a comprehensive guide to help you navigate this exciting journey.

First Things First: New Practice vs. Established Practice

Starting from Scratch – Opening a new veterinary practice means building everything from the ground up. This option provides you with the ultimate level of control over every aspect of your practice, it also involves substantial initial investment and higher risk, as you will need to attract a clientele from scratch and navigate the unpredictable early stages of business growth.

Purchasing an Existing Practice – On the other hand, acquiring an established practice comes with a built-in client base, experienced staff, and an existing revenue stream, which can significantly mitigate initial risks. Many lenders prefer financing acquisitions because they can assess the financial history of the practice to predict future revenue. However, you will inherit the existing business culture and practices, which may require time and effort to align with your vision. Potential downsides include staff turnover and adjustments in business philosophy.

Key Questions to Ask When Purchasing an Existing Practice

Once you decide to take the leap and purchase an existing practice there are a few questions you must ask yourself when evaluating the potential purchase which include:

  • How did the seller arrive at the sale price?
  • What all is included in the sale? 
  • Does the sale include any special conditions?
  • Why is the owner selling, and what are his or her plans following the sale?

Due Diligence: Ensuring a Smooth Transition

Due diligence is a critical phase in acquiring a veterinary practice, requiring meticulous attention to detail and professional expertise.

  • Compliance Documentation: Ensure all regulatory requirements are met. A compliance audit can prevent costly future fines and enhance the practice’s value.
  • Non-Disclosure Agreements:
    Protect sensitive business information with NDAs to prevent information leaks that could harm the practice’s value or operations.
  • Non-Compete Agreements
    Verify that existing veterinarians have non-compete agreements to safeguard against them taking clients if they leave the practice.

Conclusion

Owning a veterinary practice is a significant milestone, representing either the start of an exciting new venture or the culmination of a dedicated career. Whether you choose to build a practice from scratch or acquire an existing one, being well-prepared and informed is key. By asking the right questions, understanding valuation methods, and ensuring thorough due diligence, you can set the foundation for a successful and fulfilling practice ownership journey.

Clients who work with the Florida Healthcare Law Firm are protected by deep healthcare industry experience and fully served by attorneys aligned with their success. The team here doesn’t dabble in healthcare law, we specialize in full spectrum representation of healthcare providers and nearly every type of healthcare business.

Controlled Substances Dispensing Gets Pharmacy in Trouble – AGAIN!

Yet another pharmacy owner was just convicted of unlawfully dispensing over 1.5 million doses of controlled substances, primarily oxycodone and hydrocodone. 

By: Karen Davila

In my last couple of articles, I’ve focused on the controls necessary to safely operate a pharmacy and dispense appropriate prescribed medications, including controlled substances.  And those of you who heed that kind of advice are likely to avoid the unwanted attention of law enforcement.  However, for those who continue to think they can operate with impunity, heads’ up:  the war against opioids in the U.S. is ongoing and enforcement activities are not slowing down.  Below is an article about this recent case out of Texas and some lessons we can all take away from what was reported.

In this most recent case, a federal jury in Texas convicted a Texas pharmacy owner (Carr) on March 7 of one count of conspiracy to unlawfully distribute and dispense controlled substances, four counts of unlawfully distributing and dispensing controlled substances, one count of conspiracy to launder money, and two counts of engaging in transactions in property obtained from the illicit activity.  Carr now faces up to 140 years in prison, among other consequences.Continue reading

Reducing Risks in CCCs with Personal Caregiver Handbooks

Developing a Personal Caregiver Handbook that spells out expectations and accountabilities of both the resident hiring the caregiver as well as the caregiver is one of the best defenses to issues of liability that may arise.  But where do you start in building out the Handbook?  Here are some key considerations as well as areas that should be covered in the Handbook:

Prior to Developing Handbook

Because the CCC’s relationship with its residents is governed by each resident’s agreement and any move-in documents that accompanied that agreement, it is important first to review those documents to determine if there are any barriers to implementation.  Because each resident contract might be different, this process might require review of all versions in effect for any current residents.

Assuming the resident contracts do not require any additional steps before rolling out such a program, the CCC can move to the drafting of the Personal Caregiver Handbook.Continue reading

Real Risks of Caregivers on Continuing Care Community Property

Providing a high-quality and safe environment and care for vulnerable seniors is a top priority for continuing care communities (CCCs).  Senior communities that provide a full continuum for seniors aging in place (including independent living, assisted living, skilled nursing, and memory care) often focus their safety concerns and resources on the licensed areas of the community, where falls and skin breakdown are the subject of lawsuits.  Sometimes overlooked are the risks that arise when independent living residents bring their own personal caregivers into the community to support their needs.

Growing Use of Personal Caregivers

More and more seniors are finding safety and security in CCCs throughout the country.  And, as they age in place, maintaining that independence often involves the use of personal caregivers who come into the CCCs and create additional risks.  Each time a personal caregiver is allowed admittance to the CCC, real risk is created- and that risk can lead to legal liability, including:

  • Injury to other residents
  • Injury to the resident that hired the caregiver
  • Injury to the caregiver caused by other residents
  • Slip, trip and fall (or other general liability claims) by the caregiver against the CCC
  • Theft/damage to property

But there are a few basic steps that a CCC can do to reduce those risks, while still allowing residents their independence.  Here are some simple considerations:Continue reading

Healthcare Fraud Scheme Indictment Starts the New Year

The U.S. Attorney arrested 13 people in a $100 Million healthcare fraud scheme in NY and NJ involving automobile insurance claims.  Some of the facts alleged include—

  • Bribed 911 operators and hospital employees for confidential information of insured drivers
  • Unnecessary and painful medical procedures
  • A non-physician owning medical clinics
  • Paying hundreds of thousand of dollars to “runners” who used the money to bribe people

Healthcare businesses that largely serve people injured in motor vehicle accidents remain a top tier focus for law enforcement and special investigative units (SIUs) of insurers.  But so do many other providers in the healthcare sector, such as pharmacies, durable medical equipment (DME) providers, addiction treatment providers and labs.  Payer and governmental presumption is often that financial motives are driving clinical behavior, NOT documented medical necessity.  Hence the need for active compliance plans and policies and procedures that don’t sit on a shelf, but rather are woven into daily business and clinical operations.  Nothing less than the right contracts, the right compliance plan and the right business culture will establish and maintain a sustainable healthcare business!

Telemedicine Pharmacy Fraud Trial Ends in Convictions

Telemedicine pharmacy arrangements continue to be of significant interest to fraud enforcement.  A 2018 case in which four individuals and seven companies were indicted ended in a month-long jury trial of one of the individuals, a Florida pharmacy owner.  The federal jury trial in the billion-dollar telehealth pharmacy fraud scheme resulted in conviction on 22 counts of mail fraud, conspiracy to commit health care fraud and introduction of misbranded drugs into interstate commerce.  Sentencing in the case is set for May of 2022.  Other co-conspirators entered plea agreements along the way, pleading guilty to various charges including felony conspiracy to commit health care fraud, felony misbranding, conspiracy to commit wire fraud, and fraudulent telemarketing of dietary supplements, skin creams and testosterone.  Many of these are still awaiting sentencing, also expected to be scheduled sometime in 2022.

THE SCHEME

The scheme involved several individuals, compounding pharmacies and telemarketers engaged in a conspiracy to commit health care fraud, mail fraud and introducing misbranded drugs into interstate commerce.  Peter Bolos, along with two other co-conspirators, owned and operated Synergy Pharmacy in Palm Harbor, Florida.  Working with HealthRight, a telemarketer, the co-conspirators generated prescriptions for drugs such as pain creams, scar creams, and vitamins.  Using the HealthRight telemarketing platform, they would call consumers and deceive them into providing their personal insurance information and accept the drugs. HealthRight then communicated the prescription requests to physicians who authorized the prescriptions without ever interacting with the patients, and paid those physicians for issuance of the prescriptions. Through this scheme, the co-conspirators were able to solicitate insurance coverage information from consumers across the county for prescription pain creams, fraudulently obtain prescriptions, mark up the prices of the drugs and bill private insurance carriers.Continue reading

Florida Medical Device Company Settles $16 Million Case

Enforcement against medical device companies is not new and yet, these companies continue to engage in schemes that land them in hot water.  Frequently the same schemes are repeated over and over- some form of payment by the device company to a physician who selects/recommends the device to patients.  In some cases, the payment is in the form of an honorarium for speaking engagements.  In others, the payment is an all-expense paid travel to attend device company-sponsored “CME” in exotic locations or consulting fees for assisting in the evaluation and design of the device.

Announced yesterday by the U.S. Department of Justice (DOJ), is the settlement of allegations against Florida-based Arthrex Inc., a medical device company that specializes in orthopedic products.  Under the settlement agreement, Arthrex will pay $16 million for allegedly paying kickbacks to an orthopedic surgeon (Dr. Peter Millett) in Colorado.  The “payment” in this case was structured as royalty payments purportedly to compensate the orthopedic surgeon for his “contributions” to the development of two of Arthrex’s products when in fact the “payment” was intended to induce the surgeon’s recommendation/selection of the Arthrex products.  By offering the payments to the surgeon with the intent to induce purchase of Arthrex’ products which were then billed to Medicare, Arthrex violated the Anti-Kickback Statute (AKS) as well as the False Claims Act.Continue reading

What’s New with Regenerative Medicine?

The field of regenerative medicine is ever expanding and evolving. As more viable options become available to patients, it’s important to stay abreast of regulation surrounding many of these applications.

In late 2019, the Food and Drug Administration (FDA) began informing the public of multiple reports of serious adverse events experienced by patients who were “treated” with non-FDA approved products marketed as containing exosomes. As a general matter, exosomes used to treat diseases and conditions in humans are regulated as drugs and biological products under the Public Health Service Act and the Federal Food Drug and Cosmetic Act and are subject to premarket review and approval requirements. At the time of the 2019 warning, there were no FDA-approved exosome products and the FDA since then has not put out any new guidance.Continue reading

Can Paramedics Administer IVs at Doctor’s Offices, Clinics, or MedSpas?

There has been a lot of confusion lately as to whether Paramedics can administer IVs at doctors’ offices, clinics or MedSpas. While these professionals are trained to administer IVs during emergency transport, they are not allowed to administer IVs in most other situations.

The statutes and rules pertaining to paramedics and scope of practice fall under Chapter 401, Medical Telecommunications and Transportation, Florida Statutes, and Chapter 64J-1, Emergency Medical Services, Florida Administrative Code.

Based on definitions and the text of the statutes and rules, although a paramedic is trained to administer IVs, they can only do so during the course of emergency services and transportation and at public health care programs. Further, a paramedic’s services must be rendered under a medical director’s supervision, as the term medical director is defined under Section 401.23, Florida Statues. Under this statute, a medical director “is a physician employed or contracted by a “licensee” and who provides medical supervision, including appropriate quality assurance but not including administrative and managerial functions, for daily operations and training pursuant to this part.” Section 401.23(15). Pursuant to statutes, a “licensee” means any basic life support service, advanced life support service, or air ambulance service licensed pursuant to this part.” Section 401.023(13).Continue reading