by Kim Stanger, Romaine Marshall, and C. Matt Sorensen, Holland & Hart LLP

St. Joseph Health recently agreed to pay $2.14 million to settle allegations by the Department of Health and Human Services Office for Civil Rights Office (“OCR”) that its data security was inadequate.

In its investigation of St. Joseph’s handling of a 2012 data breach that exposed 31,800 patient medical records, OCR claimed St. Joseph did not change the default settings on a new server, which allowed members of the public to access via search engines the personal health information of 31,800 patients for a full year. By failing to switch off its servers’ default setting, St. Joseph potentially violated the HIPAA Security Rule’s requirement to conduct a technical and nontechnical evaluation of any operational changes that might affect the security of ePHI.

In addition to paying $2.14 million, St. Joseph Health agreed to implement a corrective action plan that requires it to conduct an enterprise-wide risk analysis, develop and implement a risk management plan, revise its policies and procedures, and train its staff on these policies and procedures. St. Joseph had conducted an enterprise-wide risk analysis in 2010, but the OCR deemed that to be inadequate because the analysis did not include an evaluation of the technical specifications of St. Joseph’s servers. Continue reading →

By Kim Stanger, Holland & Hart LLP

The Office for Civil Rights (“OCR”) continues to emphasize the need for covered entities and business associates to have compliant business associate agreements (“BAAs”). Last week, the OCR announced a $400,000 settlement with a hospital system for failing to update its BAAs to include terms required by the 2013 HIPAA Omnibus Rule. In a press release, OCR Director Jocelyn Samuels stated,

This case illustrates the vital importance of reviewing and updating, as necessary, business associate agreements, especially in light of required revisions under the Omnibus Final Rule …. The Omnibus Final Rule outlined necessary changes to established business associate agreements and new requirements which include provisions for reporting.”

See Press Release here. Earlier this year, the OCR entered settlement agreements of $1,550,000 and $750,000 based on the covered entity’s failure to execute BAAs where the business associate had experienced a data breach. See reported settlements at https://www.hhs.gov/hipaa/newsroom/index.html. The lesson is clear: covered entities must have BAAs, and those BAAs must contain the required terms; failure to do so may subject the covered entity to liability for the business associate’s breach. Continue reading →