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Doing a Proper HIPAA Risk Assessment with Mike Semel

HIPAA Risk Assessments have become a standard in healthcare. However, not everyone is doing a proper HIPAA Risk Assessment that would hold up to a HIPAA audit.

In this video HealthcareScene.com sits down with HIPAA Expert Mike Semel to discuss the HIPAA Risk Assessment and what a health care organization can do to make sure they’ve done a proper HIPAA Risk Assessment.

December 10, 2015 I Written By

John Lynn is the Founder of the HealthcareScene.com blog network which currently consists of 10 blogs containing over 8000 articles with John having written over 4000 of the articles himself. These EMR and Healthcare IT related articles have been viewed over 16 million times. John also manages Healthcare IT Central and Healthcare IT Today, the leading career Health IT job board and blog. John is co-founder of InfluentialNetworks.com and Physia.com. John is highly involved in social media, and in addition to his blogs can also be found on Twitter: @techguy and @ehrandhit and LinkedIn.

Doing a Proper HIPAA Risk Assessment with Mike Semel

HIPAA Risk Assessments have become a standard in healthcare. However, not everyone is doing a proper HIPAA Risk Assessment that would hold up to a HIPAA audit. In this video, we sits down with HIPAA Expert Mike Semel to discuss the HIPAA Risk Assessment and what a health care organization can do to make sure they’ve done a proper HIPAA Risk Assessment.

Learn more about Mike Semel and his services on the Semel Consulting website.

Full Disclosure: Semel Consulting is a sponsor of Healthcare Scene.

November 19, 2015 I Written By

John Lynn is the Founder of the HealthcareScene.com blog network which currently consists of 10 blogs containing over 8000 articles with John having written over 4000 of the articles himself. These EMR and Healthcare IT related articles have been viewed over 16 million times. John also manages Healthcare IT Central and Healthcare IT Today, the leading career Health IT job board and blog. John is co-founder of InfluentialNetworks.com and Physia.com. John is highly involved in social media, and in addition to his blogs can also be found on Twitter: @techguy and @ehrandhit and LinkedIn.

Slow Learners Teach Big Lessons – $2 Million State HIPAA Penalty

Editor’s Note: We’d like to welcome Mike Semel as the latest addition to the Healthcare Scene blog team.  We’ve been working with Mike for quite a while as a guest blogger, so it’s great to have Mike now covering security and privacy with us in a more formal capacity.  Check out all of Mike Semel’s EMR and HIPAA blog posts.

I think it is fair to call people slow learners if they get caught violating HIPAA:

  • after they published 50,000 patient records to the Internet for a 2-year period, so patients Googling themselves found their medical records,
  • and THEN DID IT AGAIN DURING THE INVESTIGATION for the first incident.

Duh.

On November 22, California Attorney General Xavier Becerra announced a $2 million settlement with Cottage Health System and its affiliated hospitals for violating both state and federal privacy laws. The settlement came after two separate data breaches where more than 50,000 patient records were made publicly available online. The state settlement is on top of a $4.125 million class-action settlement with its patients, that Cottage Health’s insurance company is trying to recover, because it said Cottage Health was not truthful on its insurance application.

It’s bad enough that from 2011 until 2013 (after it was notified by a patient that he found his medical records online), Cottage Health had a server with protected health information that was not encrypted, password protected, protected by firewalls, or protected against unauthorized access.

What is truly stunning is that, in 2015, during the federal investigation for the first incident, Cottage Health reported that it made another 4,596 patient records available online.

I have been the Chief Information Officer in a hospital, and know how bad executive and departmental management and oversight would have to be to create an environment where that can happen once, let alone twice.

Based on the complaint provided by the California Attorney General, there are a lot of lessons you can learn from this penalty.

LESSONS

1. It not just the OCR. This HIPAA penalty was issued by a state Attorney General. The federal HITECH Act (2009) gave state AG’s the authority to enforce civil penalties for violations of the HIPAA Privacy and Security Rules. It doesn’t take the federal Office for Civil Rights to go after you. It could be your state Attorney General, who is probably motivated by wanting to impress voters for his campaign to be governor or senator someday.

2. Know your state laws. California’s Confidentiality of Medical Information Act and Unfair Competition Law were also cited in the penalty. Forty-eight states, plus DC and Puerto Rico, have their own laws protecting Personally Identifiable Information. Some, like California, have state laws that protect medical records beyond the scope of HIPAA. State laws have different patient notification requirements than HIPAA’s maximum of 60 days. In California, patients must be notified within just 15 days.

3. Management should pay attention to security and compliance, before it has to sign $6 million in checks, plus legal fees. From the IT department to the executive suite, this penalty is proof that management was not validating the organization’s security and compliance.

Cottage Health isn’t a small, rural hospital with 25 beds, trying its best, with limited resources, to serve a community. According to its 2016 Annual Report, Cottage health generated over $746 million in revenue and had 3,120 employees.  Seventeen of them are Vice Presidents.

At least Cottage Health’s CEO didn’t publicly blame his IT guy, like the former CEO of Equifax did in front of Congress. Maybe he realizes he could have avoided spending $6 million by having better management.

4. Patients are Consumers, who are protected against Negligence & Unfair Business Practices. The $4 million settlement plus the $2 million penalty are proof that management was ignoring the commitment it made to its patients every day in the Cottage Health Notice of Privacy Practices.

Our Pledge
We understand that medical information about you and your health is personal, and we are committed to protecting it.

The Federal Trade Commission forced the closure of a small medical lab because it said the lab violated its prohibition of Unfair Business Practices by not protecting patient information.

There is a lawsuit in Connecticut where the state appeals court certified a Notice of Privacy Practices as a contract with a patient.

Yes, patients (and now their lawyers) really do read those notices. Treat yours with respect because it is a contract, not a brochure.

5. Don’t Assume Your HIPAA Compliance Program is Working. Not having policies, procedures, basic IT security like passwords and firewalls, means that a lot of Cottage Health managers and executives had to be asleep at the switch. Not complying with the HIPAA Security Rule, effective since 2005, which protects electronic data, means that Cottage Health’s compliance program was a mirage. I can imagine their compliance and security staff telling management that they had everything handled. Management believed them. Over 50,000 patients and an Attorney General disagree.

6. Prevent the Triggering Event. This wildfire started with a small spark. An IT engineer configured a server and plugged it into the network. Things as simple as checklists could have prevented the negligent publication of the medical records to the Internet.

The NIST Cybersecurity Framework (NIST CSF) is a 41-page document simple enough for even small organizations to use to improve their data security.

Bring in a qualified independent third party to evaluate your compliance and security against the HIPAA rules and the NIST CSF, and give the report directly to the CEO. Not a good use of the CEO’s time? It’s much better than the CEO’s involvement after an investigation has started.

7. If You Are Being Investigated, Don’t Let the Same Problem Happen Again. Duh.

December 4, 2017 I Written By

Mike Semel is a noted thought leader, speaker, blogger, and best-selling author of HOW TO AVOID HIPAA HEADACHES . He is the President and Chief Security Officer of Semel Consulting, focused on HIPAA and other compliance requirements; cyber security; and Business Continuity planning. Mike is a Certified Business Continuity Professional through the Disaster Recovery Institute, a Certified HIPAA Professional, Certified Security Compliance Specialist, and Certified Health IT Specialist. He has owned or managed technology companies for over 30 years; served as Chief Information Officer (CIO) for a hospital and a K-12 school district; and managed operations at an online backup company.

HIPAA May be the Least of Your Compliance Worries

The following is a guest blog post by Mike Semel from Semel Consulting.  Check out all of Mike Semel’s EMR and HIPAA blog posts.

What requirements have you hidden away?

I visited a new healthcare client last week, and asked if anything in particular made them call us for help with their HIPAA compliance. They surprised me by saying that their insurance company had refused to sell them a cyber-liability/data breach insurance policy, after they saw the answers on our client’s application.

When was the last time you heard about an insurance company not selling a policy? That’s like McDonalds looking you over, and then refusing to sell you a Big Mac.

Our client was scared that they would have to risk the full financial burden of a data breach, which, based on the number of medical records they have, could exceed $10 million.

Everyone knows that HIPAA is a compliance requirement. But it isn’t the only one you should focus on. Use my definition of Compliance, which is, simply, having to do things required by OTHERS.

We personally deal with compliance requirements all the time. We stop at traffic lights. We have our car inspected. We fasten our seat belts. We empty our pockets at airport security. We pay our bills on time. At work, we wear an ID badge, show up on time, and park in an approved space. At home, we take our dirty shoes off before walking on the carpet. There are risks associated with NOT doing each of these things.

It can be a big mistake to focus so much on HIPAA that you forget other compliance requirements, including:

  • Other Federal and State Laws
  • Industry Requirements
  • License Requirements
  • Contractual Obligations
  • Insurance Requirements
  • Lawsuits

You should not take the narrow HIPAA approach, like buying a policy manual, using an online ‘We Make HIPAA Easy’ service, or think hiring out a Security Risk Analysis is going to make you compliant.

When we work with our clients, before we get started we help you identify all your compliance requirements.

OTHER FEDERAL REGULATIONS

Depending on the services you offer, you may be required to comply with other federal regulations, like Title 42, governing substance abuse treatment.

The Federal Trade Commission has come down hard on data breaches, including the controversial closure of a small medical lab. The FTC looks at patients as consumers, and considers a data breach to be an Unfair Business Practice because the organization losing the data failed to protect its consumers, and is in violation of its Notice of Privacy Practices.

STATE LAWS

Forty-eight states, plus DC and Puerto Rico, have data breach laws. Most states protect Personally Identifiable Information (PII), including driver’s license and Social Security numbers. Some states cover medical records, no matter who has them, while HIPAA only covers medical records held by certain types of organizations. Some of the state laws change the reporting requirements after a breach of patient records. For example, California requires patient notification within 15 days, instead of the 60-day maximum permitted by HIPAA.

Most states have separate laws requiring confidentiality of mental health, HIV, substance abuse, or STD treatment records. State attorneys general are willing to cross their state lines to protect the confidentiality of their voters.

We work with our clients to identify the states where your patients come from, not only where you are located. We build an Incident Management program that includes each applicable notification and reporting requirement.

INDUSTRY REQUIREMENTS

Industry requirements include PCI-DSS, the data security standards protecting credit card information. PCI stands for the Payment Card Industry. While not a law, if you don’t comply with PCI you can be prevented from accepting credit cards. What would that do to your bottom line and patient satisfaction?

LICENSING

Licensing requirements protecting patient confidentiality go back long before HIPAA, which became law in 1996. In 1977, 19 years before HIPAA, I became an Emergency Medical Technician (EMT). The first class I took was about maintaining confidentiality. After that, I knew that violating a patient’s confidentiality could cost me my license.

Think about your license, your certifications, even the Code of Ethics in your professional association. If I really wanted to get back at someone for violating my confidentiality, my first complaint would be to their licensing board, even before I submitted a complaint to their employer or the federal government. Losing your license may kill your career, and being investigated by your licensing board will certainly get your attention.

When you are justifying the costs related to Security and Compliance, be sure to quantify the effect on your income, lifestyle, and retirement, if you were to lose your license.

CONTRACTS

Many of our clients have signed contracts with other organizations, that include cyber security requirements as a contractual obligation to do business together. These contracts are often reviewed by attorneys, signed by executives, and then filed away. The requirements are not always communicated to the people on the front lines.

In 2012, Omnicell, a drug cart manufacturer, breached the records of 68,000 patients when an employee’s unencrypted laptop was stolen. The health systems – clients of Omnicell –  announced that Omnicell’s contract with them included a requirement that patient data would only be stored on encrypted devices. The loss of the laptop became a breach of contract discussion, not just a simple data breach.

My guess is that the contract was signed, and then just filed away. I don’t think Omnicell’s purchasing department was told it was supposed to order encrypted laptops for its field technicians. I don’t think its IT department knew it had a contractual obligation to install encryption on all laptops, and I doubt the field tech knew he was violating a contract when he transferred patient data to his unencrypted computer. Worse, no one who was aware of the contract requirements was auditing the company’s compliance.

During a recent client visit, I asked if our client had signed any contracts with their clients. She went through a list that included one of the top health systems in the country. I’m not a lawyer, but I asked to see the contract, because I knew the health system had included cyber security requirements as a contractual obligation with our other clients.

After a few minutes, she returned with the file folder containing the contract. I found the cyber security section, and read it to her. I asked if her company was meeting the requirements in the contract. She said no. I asked her what the future of her business would look like if they lost the business of one of the country’s leading health systems, because they breached their contract. She replied that her business probably would not survive.

We focused our project around meeting the specific requirements of their contract, not the vague and flexible requirements in HIPAA.

INSURANCE

Cyber Liability (also known as Data Breach) Insurance is a popular line of revenue for insurance companies. Unlike malpractice insurance, which assumes you will make a mistake, cyber insurance may only protect you if you are doing all the things you included on your insurance application. It may pay a claim only if you are doing everything correctly, and still suffer a breach. What you answer on the application may come back to haunt you.

In 2013, Cottage Health’s IT vendor accidently published a file server to the Internet, exposing patient information. Patients Googling themselves got back their medical records. The patients filed a class action suit, so Cottage Health brought in Columbia Casualty, their cyber liability insurance provider, to provide legal representation, and settle the claim.

The lawsuit was settled for $4.1 million, which was paid by Columbia Casualty. Columbia told Cottage Health that, even though it was making the payment, it still reserved its rights and would continue investigating the case.

Columbia Casualty then sued its own client, Cottage Health, to get the $ 4.1 million back. It said it determined that Cottage Health had made misstatements when it answered questions on the original policy application, including that it regularly maintained security patches on its devices. Columbia also said it should be excluded from losses because Cottage Health failed to continuously maintain the level of security stated on its application.

The lawsuit said that it did not matter if Cottage Health was mistaken, or had intentionally lied on the application.

As part of our assessments, we review insurance applications. When we work with our clients, we help you implement consistent programs to maintain the level of security you claim on your application.

LAWSUITS

While you don’t comply with a lawsuit, watching court cases can help you understand your risks and how to protect your organization.

Many people think that a HIPAA Notice of Privacy Practices is just a basic brochure you have to include with new patient paperwork. A patient is suing her doctor for negligence after her information was shared without her authorization. She claimed that the practice did not follow its Notice of Privacy Practices, and the Connecticut Supreme Court upheld that HIPAA can be used as a Standard of Care in a negligence suit.

Walgreen’s lost $1.44 million in a lawsuit after a pharmacist breached a customer’s confidentiality. Walgreens proved its pharmacist had received HIPAA training and had signed a confidentiality agreement. The company said it had done everything possible to prevent the breach. The jury disagreed.

By looking at law suits you can see that attorneys are using compliance requirements as the basis for claims. That can be scarier compared to the likelihood is that the federal government will make the effort to go after you.

LESSONS LEARNED

It’s really easy to focus just on HIPAA and think you are compliant. It’s also a mistake.

HIPAA is vague. It is flexible, giving you a lot of freedom to choose how to comply with the regulation. The ‘HIPAA-in-a-Box’ solutions can give you a false sense of Security and Compliance, because they are so narrowly focused.

The Federal Trade Commission can assess stronger penalties than the OCR, the federal agency that enforces HIPAA. The FTC has put businesses on 20-year monitored compliance programs. When we work with our clients, we help you create written evidence that your security policies and procedures are working.

State laws can change your patient reporting requirements. They also protect confidential information you have for your workforce members. Your Incident Management program can’t just focus on HIPAA.

Industry requirements can be very serious. Can you risk not accepting credit cards? Contact the merchant service that processes your cards to make sure you are complying with PCI-DSS.

Verify the reporting requirements of the entities that license your staff. You may have an obligation to report a breach to them, instead of waiting for someone to file a complaint.

Review the contracts you have in your files for cyber security requirements, and note any in new contracts you are about to sign. Make sure everyone in your organization who must comply with the contract requirements know about them.

You can’t buy insurance instead of doing the right things to protect data. However, if you do things right insurance may save you millions of dollars. You should review your policy application every quarter, and demand evidence from your IT department or vendor that you are in compliance with the policy requirements. Too much work? Would you rather have your insurance company fail to pay a multi-million-dollar claim?

Keep repeating to yourself, “Compliance isn’t just about HIPAA” and uncover the rest of your compliance requirements.

About Mike Semel

Mike Semel is a noted thought leader, speaker, blogger, and best-selling author of HOW TO AVOID HIPAA HEADACHES . He is the President and Chief Security Officer of Semel Consulting, focused on HIPAA and other compliance requirements; cyber security; and Business Continuity planning. Mike is a Certified Business Continuity Professional through the Disaster Recovery Institute, a Certified HIPAA Professional, Certified Security Compliance Specialist, and Certified Health IT Specialist. He has owned or managed technology companies for over 30 years; served as Chief Information Officer (CIO) for a hospital and a K-12 school district; and managed operations at an online backup company.

November 21, 2017 I Written By

Business Associates are NOT Responsible for Clients’ HIPAA Compliance, BUT They Still Might Be At-Risk

The following is a guest blog post by Mike Semel from Semel Consulting.

“Am I responsible for my client’s HIPAA compliance?”

“What if I tell my client to fix their compliance gaps, and they don’t? Am I liable?”

“I told a client to replace the free cable Internet router with a real firewall to protect his medical practice, but the doctor just won’t spend the money. Can I get in trouble?”

“We are a cloud service provider. Can we be blamed for what our clients do when using our platform?”

 “I went to a conference and a speaker said that Business Associates were going to be held responsible for their clients’ compliance. Is this true???”

I hear questions like these all the time from HIPAA Business Associates.

The answers are No, No, No, No, and No.

“A business associate is not liable, or required to monitor the activities of covered entities under HIPAA, but a BA has similar responsibilities as a covered entity with respect to any of its downstream subcontractors that are also BA’s,” said Deven McGraw, Deputy Director for Health Information Privacy, US Department of Health and Human Services Office for Civil Rights (OCR), Acting Chief Privacy Officer for the Office of the National Coordinator for Health Information Technology. on August 17, 2017.

So, while you aren’t responsible for your clients’ HIPAA compliance, what they do (or don’t do) still might cost you a lot, if you aren’t careful.

In my book, How to Avoid HIPAA Headaches, there are stories about HIPAA Covered Entities that suffered when their Business Associates failed to protect PHI. North Memorial Health Care paid $ 1.55 million in HIPAA penalties based on an investigation into the loss of an unencrypted laptop by one of its Business Associates, Accretive Health.

Cottage Health, a California healthcare provider, is being sued by its insurance company to get $ 4.1 million back from a settlement after Cottage Health’s IT vendor, a Business Associate,  accidently published patient records to the Internet.

Your marketing activities; what you and your salespeople say to prospects and clients; and your written Terms & Conditions; may all create liability and financial risks for you. These must be avoided.

Semel Consulting works with a lot of Business Associates.

Many are IT companies, because I spent over 30 years owning my own IT companies. I’ve been the Chief Information Officer for a hospital and a K-12 school district, and the Chief Operating Officer for a cloud backup company. I now lead a consulting company that helps clients address their risks related to regulatory compliance, cyber security, and disaster preparedness. I speak at conferences, do webinars, and work with IT companies that refer their clients to us.

I look at the world through risk glasses. What risks do our clients have? How can I eliminate them, minimize them, or share them? When we work with our healthcare and technology industry clients, we help you identify your risks, and quantify them, so you know what resources you should reasonably allocate to protect your finances and reputation.

Under HIPAA, compliance responsibility runs one way – downhill.

Imagine a patient on top of a hill. Their doctor is below the patient. You are the doctor’s IT support company, below the doctor, and any vendors or subcontractors you work with are below you.

The doctor commits to the patient that he or she will secure the patient’s Protected Health Information (PHI) in all forms – verbal, written, or electronic. This is explained in the Notice of Privacy Practices (NPP) that the doctor gives to patients.

Under HIPAA, the doctor is allowed to hire vendors to help them do things they don’t want to do for themselves. Vendors can provide a wide variety of services, like IT support; paper shredding; consulting; malpractice defense; accounting; etc. The patient is not required to approve Business Associates, and does not have to know that outsourcing is happening. This flexibility is also explained in the patient’s Notice of Privacy Practices.

As a vendor that comes in contact with PHI, or the systems that house it, you are a HIPAA Business Associate. This requires you to sign Business Associate Agreements and, since 2013, when the HIPAA Omnibus Final Rule went into effect, it also means that you must implement a complete HIPAA compliance program and be liable for any breaches you cause.

IT companies may decide to resell cloud services, online backup solutions, or store servers in a secure data center. Since the HIPAA Omnibus Final Rule went into effect, a Business Associate’s vendors (known as subcontractors) must also sign Business Associate Agreements with their customers, and implement complete HIPAA compliance programs.

Because compliance responsibility runs downhill, the doctor is responsible to the patient that his Business Associates will protect the patient’s confidential information. The Business Associates assures the doctor that they, and their subcontractors, will protect the patient’s confidential information. Subcontractors must commit to Business Associates that they will protect the information. A series of two-party agreements are required down the line from the doctor to the subcontractors.

It doesn’t work the other way. Subcontractors are not responsible for Business Associates, and Business Associates are not responsible for Covered Entities, like doctors.

HIPAA compliance responsibility, and legal and financial liability, are different.

A HIPAA Covered Entity is responsible for selecting compliant vendors. Business Associates are responsible for selecting compliant subcontractors. Subcontractors must work with compliant subcontractors.

Because Covered Entities are not liable for their Business Associates, and Business Associates are not liable for their Subcontractors, they are not required to monitor their activities. But, you still need to be sure your vendors aren’t creating risks. The Office for Civil Rights (OCR) says that:

… if a covered entity finds out about a material breach or violation of the contract by the business associate, it must take reasonable steps to cure the breach or end the violation, and, if unsuccessful, terminate the contract with the business associate. If termination is not feasible (e.g., where there are no other viable business alternatives for the covered entity), the covered entity must report the problem to the Department of Health and Human Services Office for Civil Rights. See 45 CFR 164.504(e)(1).

With respect to business associates, a covered entity is considered to be out of compliance with the Privacy Rule if it fails to take the steps described above. If a covered entity is out of compliance with the Privacy Rule because of its failure to take these steps, further disclosures of protected health information to the business associate are not permitted.

In its Cloud Service Provider (CSP) HIPAA Guidance released in 2016, the OCR said:

A covered entity (or business associate) that engages a CSP should understand the cloud computing environment or solution offered by a particular CSP so that the covered entity (or business associate) can appropriately conduct its own risk analysis and establish risk management policies, as well as enter into appropriate BAAs.  See 45 CFR §§ 164.308(a)(1)(ii)(A); 164.308(a)(1)(ii)(B); and 164.502. 

Both covered entities and business associates must conduct risk analyses to identify and assess potential threats and vulnerabilities to the confidentiality, integrity, and availability of all ePHI they create, receive, maintain, or transmit.  For example, while a covered entity or business associate may use cloud-based services of any configuration (public, hybrid, private, etc.),[3] provided it enters into a BAA with the CSP, the type of cloud configuration to be used may affect the risk analysis and risk management plans of all parties and the resultant provisions of the BAA.

How can a Business Associate be affected by a client’s compliance failure?  Here are some scenario’s.

(FYI, I am not a lawyer and this is not legal advice. These ideas came out of meetings I had with my attorney to review our contracts and our marketing. Talk to your lawyer to make sure you are protected!)

  1. IT companies should never tell your client, “We’ll be responsible for your IT so you can focus on your medical practice.”

Sound familiar? This is what many IT Managed Service Providers tell their prospects and clients.

Then the client has a data breach because they were too cheap to buy a firewall, they refused to let you implement secure passwords because it would inconvenience their staff, or they lost an unencrypted thumb drive even though you had set up a secure file sharing platform.

Someone files a HIPAA complaint, the OCR conducts an investigation, and your client pays a big fine. Then they sue you, saying you told them IT was your responsibility. Maybe they misunderstood what you included in your Managed Services. Maybe you did not clearly explain what responsibility you were accepting, and what IT responsibility was still theirs. Either way, you could spend a lot on legal fees, and even lose a lawsuit if a jury believes you made the client believe you were taking over their compliance responsibility.

  1. You must clearly identify what is, and what is not, included in your services.

Your client pays you a monthly fee for your services. Then they have a breach. They may expect that all the tasks you perform, and the many hours of extra labor you incur, are included in their monthly fee. They get mad when you say you will be charging them for additional services, even though they have just hired a lawyer at $ 500 per hour to advise them. Without written guidelines, you may not be able to get paid.

  1. You must be sure you get paid if your client drags you into something that is not your fault.

Imagine you were the IT company that set up an e-mail server for a recent presidential candidate. As unlikely as this may sound, this becomes a political issue. You just did what the client requested, but now you must hire attorneys to advise you. You must hire a public relations firm to deal with the media inquiries and protect your name in the marketplace. You must send your techs and engineers – your major source of a lot of income – to Washington for days to testify in front of Congress, after they spent more unbillable time preparing their testimony.

Who pays? How do you keep from losing your client? How do you protect your reputation?

HOW TO PROTECT YOUR FINANCES AND YOUR REPUTATION

  • Make sure you and your salespeople are careful to not overpromise your services. Make sure you and your sales team tell your prospects and clients that they are always ultimately responsible for their own security and compliance.
  • Make sure your contracts and Terms and Conditions properly protect you by identifying what services are/aren’t covered, and when you can bill for additional services. Don’t forget to include your management time when sending bills. Use a competent lawyer familiar with your needs to write your agreements and advise you on any agreements presented to you by others.
  • State in your Terms & Conditions that you will be responsible for your own company’s compliance (you are anyway) but that you are not responsible for your clients’ compliance.
  • Include terms that require your client to pay for ALL costs related to a compliance violation, government action, investigation, lawsuit, or other activity brought against them, that requires your involvement. Use a competent lawyer familiar with your needs to write your agreements and advise you on any agreements presented to you by others.
  • My attorney said we should include “change in government regulations” in our Force Majeure clause to allow us to modify our contract or our pricing before a contract expires. The 2013 HIPAA Omnibus Rule created a lot of expensive responsibilities for Business Associates. You don’t want to get stuck in an existing contract or price model if your costs suddenly increase because of a new law or rule.
  • Get good Professional Liability or Errors & Omissions insurance to protect you if you make a mistake, are sued, or dragged into a client’s investigation. Make sure you understand the terms of the policy and how it covers you. Make sure it includes legal representation. Ask for a custom policy if you need special coverage.
  • Make a negative a positive by promoting that you offer the specialized services clients will need in case they are ever audited, investigated, or sued.

If you do this right, you will protect your business and leverage compliance to increase your profits. When you focus on compliance, you can get clients willing to pay higher prices because you understand their compliance requirements. I know. I have generated millions of dollars in revenue using compliance as a differentiator.

About Mike Semel

Mike Semel is a noted thought leader, speaker, blogger, and best-selling author. He is the President and Chief Security Officer of Semel Consulting, focused on HIPAA (and other regulatory) compliance; cyber security; and Business Continuity planning. Mike is a Certified Business Continuity Professional through the Disaster Recovery Institute, a Certified HIPAA Professional, Certified Security Compliance Specialist, and Certified Health IT Specialist. He has owned or managed technology companies for over 30 years; served as Chief Information Officer (CIO) for a hospital and a K-12 school district; and managed operations at an online backup company.

August 25, 2017 I Written By

5 Lessons In One Big HIPAA Penalty

The following is a guest blog post by Mike Semel, President and Chief Compliance Officer at Semel Consulting.

The federal Office for Civil Rights just announced a $ 3.2 million penalty against Children’s Medical Center of Dallas.

5 Lessons Learned from this HIPAA Penalty

  1. Don’t ignore HIPAA
  2. Cooperate with the enforcers
  3. Fix the problems you identify
  4. Encrypt your data
  5. Not everyone in your workforce should be able to access Protected Health Information

If you think complying with HIPAA isn’t important, is expensive, and annoying, do you realize you could be making a $3.2 million decision? In this one penalty there are lots of hidden and not-so-hidden messages.

1. A $ 3.2 million penalty for losing two unencrypted devices, 3 years apart.

LESSON LEARNED: Don’t ignore HIPAA.

If Children’s Medical Center was paying attention to HIPAA as it should have, it wouldn’t be out $3.2 million that should be used to treat children’s medical problems. Remember that you protecting your patients’ medical information is their Civil Right and part of their medical care.

2. This is a Civil Money Penalty, not a Case Resolution.

What’s the difference? A Civil Money Penalty is a fine. It could mean that the entity did not comply with the investigation; (as in this case) did not respond to an invitation to a hearing; or did not follow corrective requirements from a case resolution. Most HIPAA penalties are Case Resolutions, where the entity cooperates with the enforcement agency, and which usually results in a lower dollar penalty than a Civil Money Penalty.

LESSON LEARNED: Cooperate with the enforcers. No one likes the idea of a federal data breach investigation, but you could save a lot of money by cooperating and asking for leniency. Then you need to follow the requirements outlined in your Corrective Action Plan.

3. They knew they had security risks in 2007 and never addressed them until 2013, after a SECOND breach.

Children’s Medical Center had identified its risks and knew it needed to encrypt its data as far back as 2007, but had a breach of unencrypted data in 2010 and another in 2013.

LESSON LEARNED: Don’t be a SLOW LEARNER. HIPAA requires that you conduct a Security Risk Analysis AND mitigate your risks. Self-managed risk analyses can miss critical items that will result in a breach. Paying for a risk analysis and filing away the report without fixing the problems can turn into a $ 3.2 million violation. How would you explain that to your management, board of directors, your patients, and the media, if you knew about a risk and never did anything to address it? How will your management and board feel about you when they watch $3.2 million be spent on a fine?

4. There is no better way to protect data than by encrypting it.

HIPAA gives you some leeway by not requiring you to encrypt all of your devices, as long as the alternative methods to secure the data are as reliable as encryption. There’s no such thing.

If an unencrypted device is lost or stolen, you just proved that your alternative security measures weren’t effective. It amazes me how much protected data we find floating around client networks. Our clients swear that their protected data is all in their patient care system; that users are given server shares and always use them; that scanned images are directly uploaded into applications; and that they have such good physical security controls that they do not need to encrypt desktop computers and servers.

LESSON LEARNED: You must locate ALL of your data that needs to be protected, and encrypt it using an acceptable method with a tracking system. We use professional tools to scan networks looking for protected data.

5. Not everyone in your workforce needs access to Protected Health Information.

We also look at paper records storage and their movement. This week we warned a client that we thought too many workforce members had access to the rooms that store patient records. The Children’s Medical Center penalty says they secured their laptops but “provided access to the area to workforce not authorized to access ePHI.”

LESSON LEARNED: Is your Protected Health Information (on paper and in electronic form) protected against unauthorized physical access by your workforce members not authorized to access PHI?

You can plan your new career after your current organization gets hit with a preventable $ 3.2 million penalty, just like Children’s Medical Center. Or, you can take HIPAA seriously, and properly manage your risks.

Your choice.

About Mike Semel
mike-semel-hipaa-consulting
Mike Semel is the President and Chief Compliance Officer for Semel Consulting. He has owned IT businesses for over 30 years, has served as the Chief Information Officer for a hospital and a K-12 school district, and as the Chief Operating Officer for a cloud backup company. Mike is recognized as a HIPAA thought leader throughout the healthcare and IT industries, and has spoken at conferences including NASA’s Occupational Health conference, the New York State Cybersecurity conference, and many IT conferences. He has written HIPAA certification classes and consults with healthcare organizations, cloud services, Managed Service Providers, and other business associates to help build strong cybersecurity and compliance programs. Mike can be reached at 888-997-3635 x 101 or mike@semelconsulting.com.

February 2, 2017 I Written By

Top EMR and HIPAA Blog Posts of 2016

At the end of each year, it’s fun to pull up the stats and see which blog posts were the most popular blog posts and pages on EMR and HIPAA. What’s shocking to me is how many older posts on EMR and HIPAA are still generating a ton of traffic. Here’s a look at the top 10 blog posts and a bit of commentary on each.

1. Healthcare IT and EHR Conferences and Events – This page has gotten 10 times more traffic than pretty much all of the other posts on this list.  I’m biased, but it’s a great resource.  It also illustrates to me that I should spend more time creating these types of deep resources that are useful to readers.  It also illustrates that I traveled too much in 2016, but I’ve enjoyed every moment of those trips.

2. 6 Healthcare Incubators Growing the Future of HealthTech – This post probably needs to be updated with which incubators are still around and new healthcare incubators that have launched.  Might also be interesting to look at how well companies from the various incubators have done since being in the incubator.

3. Benefits of EMR or EHR Over Paper Charts – This was one of the first pages I ever created on EMR and HIPAA.  The sad part is that it looks like I still had plenty left to complete on that page.  However, it still highlights many of the benefits of EMR and EHR.  I’m glad it’s still getting visits since far too often we love to complain about EMR and EHR and take for granted all the benefits that an EHR provides.

4. 10 Ways Many Dental Offices Are Breaching HIPAA – This was a great guest post by Trevor James.  It was targeted at Dental Offices, but most of the items apply to any healthcare organization.  It’s amazing how many people still don’t understand HIPAA and what it requires.

5. Meaningful Use Is Going to Be Replaced – #JPM16 – This announcement was a bit of a surprise when it happened and I’m trying to understand why we didn’t know this was coming.  I also find it quite interesting that Andy Slavitt chose to make this announcement at JP Morgan’s annual healthcare conference and not at HIMSS or some other event.  Maybe it was just timing, but I think that says a lot about the JP Morgan event.

6. 2014 EHR Mandate – One of the top searches that refers traffic to EMR and HIPAA are related to the question of whether there’s an EHR mandate.  That’s likely why this post is so popular even though it was written back in 2011.  It’s amazing how well this content still applies almost 6 years later.  There is no EHR mandate and I don’t think there ever will be.  However, there are forces and reasons to use EHR.

7. Crazy and Funny ICD-10 Codes – These are still funny today.  Although, I’m a bit surprised that the post is still so popular.  It would be interesting to see a report from an EHR vendor or someone on how many of these funny codes actually get used in practice.  My guess is not very many times, but I’m open to being surprised.

8. The Impact of the 2016 Election on Healthcare IT – This was a prediction post.  We’ll need another year or two to see if my predictions were accurate.  I’m still pretty confident in them.

9. Examples of HIPAA Privacy Violations – More HIPAA Lawsuits Coming? – This post is amazing since it was written back in 2006.  That makes it almost 10 years old.  What can I say?  Concern over HIPAA lawsuits is a big deal and people can’t help to look when a wreck (ie. HIPAA violation) happens.

10. Has Electronic Health Record Replacement Failed? – Props to Justin Campbell from Galen Healthcare on this great piece.  I think we’re just at the beginning of the EHR replacement market.  So, I have a feeling this piece and others like it are going to continue in popularity.

11. Don’t Yell FHIR in a Hospital … Yet – I’m a little shocked to find this on the list since it was only posted a month ago. I guess the topic of FHIR is a good one and Richard’s post throwing some words of caution on the FHIR train was of interest to many.

12. EMR Templates – I think this was the only post on the list that I didn’t remember without looking.  No surprise, the post was from 2012.  I’m always a little scared to read some of my early blog posts.  However, this one was pretty good.  The challenge of template documentation in EHR software versus other methods is still an important discussion, but one that’s not really happening now.

13. Practice Fusion Violates Some Physicians’ Trust in Sending Millions of Emails to Their Patients – This post kind of needs no explanation.  I worked for probably a month writing it, so I’m glad that it’s still getting read.  It probably got an extra bump this year because the FTC finally closed the case against Practice Fusion that came out of this article.  It’s still an astounding story.

14. EMR Companies Holding Practice Data for “Ransom” – Wow!  Another post from 2011.  This is still a problem today, but the dynamics have changed for most companies.  Although, the challenge is likely to get even harder since many EHR vendors are now SaaS based EHR which make it even harder to get your data and easier for the EHR vendor to hold that data for “ransom.”

15. Securing Your HIPAA Controlled Computer Workstations – This post is from 2006.  My how things have changed in 10 years.  It’s an interesting look into where I started with this blog.  I’ve wondered lately if I should get back into more practical posts like this one.

16. Best Scanners for High Volume Scanning in a Doctor’s Office – A good scanner is still essential in every healthcare organization even if you have an EHR.  These Fujitsu’s are still good options, but I’ve also seen great success with the Ambir and Canon imageFormula scanners as well.

17. Don’t Blame HIPAA: It Didn’t Require Orlando Regional Medical Center To Call the President – This was a great reality check from Mike Semel on the salacious news that the President had got involved in the HIPAA issues related to the Orlando shootings.  Mike did this a number of times in 2016, so check out all his HIPAA blog posts.

18. HIPAA Cloud Bursts: New Guidance Proves Cloud Services Are Business Associates – Another great example of Mike Semel dropping HIPAA knowledge bombs.  It’s no surprise that his posts are on this list multiple times.

19. Quality Reporting: A Drain on Practice Resources, New Study Shows –  This chart from Steven’s post has really stuck with me.  The administrative bloat in healthcare is brutal.  The challenge is that I’m not sure how we get back to the more reasonable levels of the past.  Every doctor I know feels this and it’s an awful thing for patients.

20. Health Plans Need Your Records: Know What’s Driving Requests and How to Be Prepared – I’d known Craig Mercure for years and across multiple companies.  It was great to meet up with him again in 2016 at his new position at CIOX Health.  He certainly opened my eyes to the new world of health plan records requests.  CIOX has a great business doing this for health plans.

There’s a quick run down of the top blog posts on EMR and HIPAA for 2016.  Seeing all my old posts is fun and sometimes embarrassing.  I guess it does highlight the powerful long tail of great content.

Did you have a favorite EMR and HIPAA post?  We’d love to hear about it.

December 30, 2016 I Written By

John Lynn is the Founder of the HealthcareScene.com blog network which currently consists of 10 blogs containing over 8000 articles with John having written over 4000 of the articles himself. These EMR and Healthcare IT related articles have been viewed over 16 million times. John also manages Healthcare IT Central and Healthcare IT Today, the leading career Health IT job board and blog. John is co-founder of InfluentialNetworks.com and Physia.com. John is highly involved in social media, and in addition to his blogs can also be found on Twitter: @techguy and @ehrandhit and LinkedIn.

Don’t Worry About HIPAA – When Your License Is At-Risk!

The following is a guest blog post by Mike Semel, President and Chief Compliance Officer at Semel Consulting.
medical-license-revoked
Not long ago I was at an ambulance service for a HIPAA project when one of their paramedics asked what the odds were that his employer would get a HIPAA fine if he talked about one of his patients. I replied that the odds of a HIPAA penalty were very slim compared to him losing his state-issued paramedic license, that would cost him his job and his career. He could also be sued. He had never thought of these risks.

Doctors, dentists, lawyers, accountants, psychologists, nurses, EMT’s, paramedics, social workers, mental health counselors, and pharmacists, are just some of the professions that have to abide by confidentiality requirements to keep their licenses.

License and ethical requirements have required patient and client confidentiality long before HIPAA and other confidentiality laws went into effect.  HIPAA became effective in 2003, 26 years after I became a New York State certified Emergency Medical Technician (EMT). Way back in 1977, the very first EMT class I took talked about my responsibility to keep patient information confidential, or I would risk losing my certification.

While licensed professionals may not talk about an individual patient or client, weak cybersecurity controls could cause a breach of ALL of their patient and client information – instantly.
health-data-encryption
Most certified and licensed professionals will agree that they are careful not to talk about patients and clients, but how well do they secure their data? Are their laptops encrypted? Are security patches and updates current? Do they have a business-class firewall protecting their network? Do they have IT security professionals managing their technology?
psychologist-loses-license-prostitute-takes-laptop
Lawyers have been sanctioned for breaching confidentiality. Therapists have lost their licenses. In one well-publicized case a psychologist lost his license when a prostitute stole his laptop. In rare cases a confidentiality breach will result in a jail sentence, along with the loss of a license.

Cyber Security Ethics Requirements
Lawyers are bound by ethical rules that apply to confidentiality and competence. The competence requirements typically restrict lawyers from taking cases in unfamiliar areas of the law. However, The American Bar Association has published model guidance that attorneys not competent in the area of cyber security must hire professionals to help them secure their data.

The State Bar of North Dakota adopted technology amendments to its ethics rules in early 2016. The State Bar of Wisconsin has published a guide entitled Cybersecurity and SCR Rules of Professional Conduct. In 2014, The New York State Bar Association adopted Social Media Ethics Guidelines. Lawyers violating these ethical requirements can be sanctioned or disbarred.

A State Bar of Arizona ethics opinion said “an attorney must either have the competence to evaluate the nature of the potential threat to the client’s electronic files and to evaluate and deploy appropriate computer hardware and software to accomplish that end, or if the attorney lacks or cannot reasonably obtain that competence, to retain an expert consultant who does have such competence.”

Some licensed professionals argue that their ethical and industry requirements mean they don’t have to comply with other requirements. Ethical obligations do not trump federal and state laws. Lawyers defending health care providers in malpractice cases are HIPAA Business Associates. Doctors that have to comply with HIPAA also must adhere to state data breach laws. Psychiatric counselors, substance abuse therapists, pharmacists, and HIV treatment providers have to comply with multiple federal and state confidentiality laws in addition to their license requirements.

There are some exemptions from confidentiality laws and license requirements when it comes to reporting child abuse, notifying law enforcement when a patient becomes a threat, and in some court proceedings.

While the odds of a federal penalty for a confidentiality breach are pretty slim, it is much more likely that someone will complain to your licensing board and kill your career. Don’t take the chance after all you have gone through to earn your license.

About Mike Semel
mike-semel-ambulance
Mike Semel is the President and Chief Compliance Officer for Semel Consulting. He has owned IT businesses for over 30 years, has served as the Chief Information Officer for a hospital and a K-12 school district, and as the Chief Operating Officer for a cloud backup company. Mike is recognized as a HIPAA thought leader throughout the healthcare and IT industries, and has spoken at conferences including NASA’s Occupational Health conference, the New York State Cybersecurity conference, and many IT conferences. He has written HIPAA certification classes and consults with healthcare organizations, cloud services, Managed Service Providers, and other business associates to help build strong cybersecurity and compliance programs. Mike can be reached at 888-997-3635 x 101 or mike@semelconsulting.com.

October 24, 2016 I Written By

States Strengthen Data Breach Laws & Regulations

The following is a guest blog post by Mike Semel, President and Chief Compliance Officer at Semel Consulting.

If your cyber security and compliance program is focused on just one regulation, like HIPAA or banking laws, many steps you are taking are probably wrong.

Since 2015 a number of states have amended their data breach laws which can affect ALL BUSINESSES, even those out of state, that store information about their residents. The changes address issues identified in breach investigations, and public displeasure with the increasing number of data breaches that can result in identity theft.

Forty-seven states, plus DC, Puerto Rico, Guam, and the US Virgin Islands, protect personally identifiable information, that includes a person’s name plus their Driver’s License number, Social Security Number, and the access information for bank and credit card accounts.

Many organizations mistakenly focus only on the data in their main business application, like an Electronic Health Record system or other database they use for patients or clients. They ignore the fact that e-mails, reports, letters, spreadsheets, scanned images, and other loose documents contain data that is also protected by laws and regulations. These documents can be anywhere – on servers, local PC’s, portable laptops, tablets, mobile phones, thumb drives, CDs and DVDs, or somewhere up in the Cloud.

Some businesses also mistakenly believe that moving data to the cloud means that they do not have to have a secure office network. This is a fallacy because your cloud can be accessed by hackers if they can compromise the local devices you use to get to the cloud. In most cases there is local data even though the main business applications are in the cloud. Local computers should have business-class operating systems, with encryption, endpoint protection software, current security patches and updates, and strong physical security. Local networks need business-class firewalls with active intrusion prevention.

States are strengthening their breach laws to make up for weaknesses in HIPAA and other federal regulations. Between a state and federal law, whichever requirement is better for the consumer is what those storing data on that state’s residents (including out of state companies) must follow.

Some states have added to the types of information protected by their data breach reporting laws. Many states give their residents the right to sue organizations for not providing adequate cyber security protection. Many states have instituted faster reporting requirements than federal laws, meaning that incident management plans that are based on federal requirements may mean you will miss a shorter state reporting deadline.

In 2014, California began requiring mandatory free identity theft prevention services even when harm cannot be proven. This year Connecticut adopted a similar standard. Tennessee eliminated the encryption safe harbor, meaning that the loss of encrypted data must be reported. Nebraska eliminated the encryption safe harbor if the encryption keys might have been compromised. Illinois is adding medical records to its list of protected information.

Massachusetts requires every business to implement a comprehensive data protection program including a written plan. Texas requires that all businesses that have medical information (not just health care providers and health plans) implement a staff training program.

REGULATIONS

Laws are not the only regulations that can affect businesses.

The New York State Department of Financial Services has proposed that “any Person operating under or required to operate under a license, registration, charter, certificate, permit, accreditation or similar authorization under the banking law, the insurance law or the financial services law” comply with new cyber security regulations. This includes banks, insurance companies, investment houses, charities, and even covers organizations like car dealers and mortgage companies who handle consumer financial information.

The new rule will require:

  • A risk analysis
  • An annual penetration test and quarterly vulnerability assessments
  • Implementation of a cyber event detection system
  • appointing a Chief Information Security Officer (and maintaining compliance responsibility if outsourcing the function)
  • System logging and event management
  • A comprehensive security program including policies, procedures, and evidence of compliance

Any organization connected to the Texas Department of Health & Human Services must agree to its Data Use Agreement, which requires that a suspected breach of some of its information be reported within ONE HOUR of discovery.

MEDICAL RECORDS

People often assume that their medical records are protected by HIPAA wherever they are, and are surprised to find out this is not the case. HIPAA only covers organizations that bill electronically for health care services, validate coverage, or act as health plans (which also includes companies that self-fund their health plans).

  • Doctors that only accept cash do not have to comply with HIPAA.
  • Companies like fitness centers and massage therapists collect your medical information but are not covered by HIPAA because they do not bill health plans.
  • Health information in employment records are exempt from HIPAA, like letters from doctors excusing an employee after an injury or illness.
  • Workers Compensation records are exempt from HIPAA.

Some states protect medical information with every entity that may store it. This means that every business must protect medical information it stores, and must report it if it is lost, stolen, or accessed by an unauthorized person.

  • Arkansas
  • California
  • Connecticut
  • Florida
  • Illinois (beginning January 1, 2017)
  • Massachusetts
  • Missouri
  • Montana
  • Nevada
  • New Hampshire
  • North Dakota
  • Oregon
  • Puerto Rico
  • Rhode Island
  • Texas
  • Virginia
  • Wyoming

Most organizations are not aware that they are governed by so many laws and regulations. They don’t realize that information about their employees and other workforce members are covered. Charities don’t realize the risks they have protecting donor information, or the impact on donations a breach can cause when it becomes public.

We have worked with many healthcare and financial organizations, as well as charities and general businesses, to build cyber security programs that comply with federal and state laws, industry regulations, contractual obligations, and insurance policy requirements. We have been certified in our compliance with the federal NIST Cyber Security Framework (CSF) and have helped others adopt this security framework, that is gaining rapid acceptance.

About Mike Semel
mike-semel-hipaa-consulting
Mike Semel is the President and Chief Compliance Officer for Semel Consulting. He has owned IT businesses for over 30 years, has served as the Chief Information Officer for a hospital and a K-12 school district, and as the Chief Operating Officer for a cloud backup company. Mike is recognized as a HIPAA thought leader throughout the healthcare and IT industries, and has spoken at conferences including NASA’s Occupational Health conference, the New York State Cybersecurity conference, and many IT conferences. He has written HIPAA certification classes and consults with healthcare organizations, cloud services, Managed Service Providers, and other business associates to help build strong cybersecurity and compliance programs. Mike can be reached at 888-997-3635 x 101 or mike@semelconsulting.com.

October 18, 2016 I Written By

HIPAA Cloud Bursts: New Guidance Proves Cloud Services Are Business Associates

The following is a guest blog post by Mike Semel, President and Chief Compliance Officer at Semel Consulting.
hipaa-cloud
It’s over. New guidance from the federal Office for Civil Rights (OCR) confirms that cloud services that store patient information must comply with HIPAA.

Many cloud services and data centers have denied their obligations by claiming they are not HIPAA Business Associates because:

  1. They have no access to their customer’s electronic Protected Health Information (ePHI),
  2. Their customer’s ePHI is encrypted and they don’t have the encryption key,
  3. They never look at their customer’s ePHI,
  4. Their customers manage the access to their own ePHI in the cloud,
  5. Their terms and conditions prohibit the storage of ePHI, and
  6. They only store ePHI ‘temporarily’ and therefore must be exempt as a ‘conduit.’

Each of these excuses has been debunked in HIPAA Cloud Guidance released on October 7, 2016, by the Office for Civil Rights.

The new guidance clearly explains that any cloud vendor that stores ePHI must:

  1. Sign a HIPAA Business Associate Agreement,
  2. Conduct a HIPAA Security Risk Analysis,
  3. Comply with the HIPAA Privacy Rule,
  4. Implement HIPAA Security Rule safeguards the ePHI to ensure its confidentiality, integrity, and availability.
  5. Comply with the HIPAA Breach Reporting Rule by reporting any breaches of ePHI to its customers, and be directly liable for breaches it has caused.

The OCR provides examples of cloud services where clients manage access to their stored data. It discusses how a client can manage its users’ access to the stored data, while the cloud service manages the security of the technical infrastructure. Each needs to have a risk analysis that relates to its share of the responsibilities.
access-denied-phi
OCR also recently published guidance that cloud services cannot block or terminate a client’s access to ePHI, for example, if they are in a dispute with their customer or the customer hasn’t paid its bill.

As we have been saying for years, the 2013 HIPAA Omnibus Final Rule expanded the definition of HIPAA Business Associates to include anyone outside a HIPAA Covered Entity’s workforce that “creates, receives, maintains, or transmits PHI” on behalf of the Covered Entity. It defines subcontractors as anyone outside of a Business Associate’s workforce that “creates, receives, maintains, or transmits PHI on behalf of another Business Associate.”

‘Maintains’ means storing ePHI, and does not distinguish whether the ePHI is encrypted, whether the Business Associate looks at the ePHI, or even if its staff has physical access to the devices housing the ePHI (like servers stored in locked cabinets in a data center.)
hipaa-fines-payment
A small medical clinic was fined $100,000 for using a free cloud mail service to communicate ePHI, and for using a free online calendar to schedule patient visits. Recently the OCR issued a $2.7 million penalty against Oregon Health & Science University (OHSU) partly for storing ePHI with a cloud service in the absence of a Business Associate Agreement.

“OHSU should have addressed the lack of a Business Associate Agreement before allowing a vendor to store ePHI,” said OCR Director Jocelyn Samuels.  “This settlement underscores the importance of leadership engagement and why it is so critical for the C-suite to take HIPAA compliance seriously.”

So what does this mean to you?

If you are Covered Entity or a Business Associate…

  • A common myth is that all ePHI is in a structured system like an Electronic Health Record system. This is wrong because ePHI includes anything that identifies a patient, nursing home resident, or health plan member that is identifiable (many more identifiers than just a name) and relates to the treatment, diagnosis, or payment for health care.

    EPHI can be in many forms. It does not have to be in a formal system like an Electronic Health Record (EHR) system, but can be contained in an e-mail, document, spreadsheet, scanned or faxed image, medical images, photographs, and even voice files, like a patient leaving a message in your computerized phone system requesting a prescription refill. During our risk analyses we find ePHI everywhere- on servers, local devices, portable media, mobile devices, and on cloud services. Our clients are usually shocked when we show them where their ePHI is hiding.

  • Never store ePHI in any cloud service without first knowing that the service is compliant with HIPAA and will sign a HIPAA Business Associate Agreement.

    This automatically disqualifies:

    • The free texting that came with your cellular phone service;
    • Free e-mail services like Gmail, Yahoo!, Hotmail, etc.;
    • Free e-mail from your Internet service provider like Cox, Comcast, Time Warner, Charter, CenturyLink, Verizon, Frontier, etc.;
    • Free file sharing services from DropBox, Box.com, Google Drive, etc.
    • Consumer-grade online backup services.

hacked-healthcare

  • Another common myth is that if data is stored in the cloud that you don’t have to secure your local devices. This is wrong because if someone can compromise a local device they can gain access to your data in the cloud. Be sure the mobile devices and local devices you use to access the cloud are properly protected, including those on your office network, and at users’ homes. This means that all mobile devices like phones and tablets; PCs; and laptops should be secured to prevent unauthorized access. All devices should be constantly updated with security patches, and anti-virus/anti-malware software should be installed and current. If ePHI is stored on a local network, it must be a domain with logging turned on, and logs retained for six years.
  • Use an e-mail service that complies with HIPAA. Microsoft Office 365 and similar business-class services advertise that they provide secure communications and will sign a HIPAA Business Associate Agreement.
  • You may be using a vendor to remotely filter your e-mail before it arrives in your e‑mail system. These services often retain a copy of each message so it can be accessed in the event your mail server goes down. Make sure your spam filtering service secures your messages and will sign a HIPAA Business Associate Agreement.

mobile-device-security-in-healthcare

  • Never send or text ePHI, even encrypted, to a caregiver or business associate at one of the free e-mail services.
  • Never use the free texting that came with your cell service to communicate with patients and other caregivers.
  • If you have sent text messages, e-mails, or stored documents containing ePHI using an unapproved service, delete those messages now, and talk with your compliance officer.
  • Review your HIPAA compliance program, to ensure it really meets all of HIPAA’s requirements under the Privacy, Security, and Data Breach Reporting rules. There are 176 auditable HIPAA items. You may also need to comply with other federal and state laws, plus contractual and insurance requirements.

If you are a cloud service, data center, or IT Managed Service Provider …

  • If you have been denying that you are a HIPAA Business Associate, read the new guidance document and re-evaluate your decisions.
  • If you do sign HIPAA Business Associate Agreements, you need to review your internal HIPAA compliance program to ensure that it meets all of the additional requirements in the HIPAA Privacy, Security, and Data Breach Reporting rules.
  • Also become familiar with state regulations that protect personally identifiable information, including driver’s license numbers, Social Security numbers, credit card and banking information. Know which states include protection of medical information, which will require breach reporting to the state attorney general in addition to the federal government. Know what states have more stringent reporting timeframes than HIPAA. You may have to deal with a large number of states with varying laws, depending on the data you house for customers.

hipaa-terms-and-conditions

  • Make sure your Service Level Agreements and Terms & Conditions are not in conflict with the new guidance about blocking access to ePHI. Compare your policies for non-payment with the new guidance prohibiting locking out access to ePHI.
  • Make sure your Service Level Agreements and Terms & Conditions include how you will handle a breach caused by your clients when they are using your service. Everyone should know what will happen, and who pays, if you get dragged into a client’s data breach investigation.
  • Make sure all of your subcontractors, and their subcontractors, comply with HIPAA. This includes the data centers you use to house and/or manage your infrastructure, programmers, help desk services, and backup vendors.
  • Learn about HIPAA. We see many cloud vendors that promote their HIPAA compliance but can seldom answer even the most basic questions about the compliance requirements. Some believe they are compliant because they sign Business Associate Agreements. That is just the first step in a complex process to properly secure data and comply with the multiple regulations that affect you. We have helped many cloud services build compliance programs that protected them against significant financial risks.
  • If you have administrative access to your client’s networks that contain ePHI, you are a Business Associate. Even if your clients have not signed, or refused to sign, Business Associate Agreements, you are still a Business Associate and must follow all of the HIPAA rules.
  • If you are reselling hosting services, co-location services, cloud storage, file sharing, online backup, Office 365/hosted Exchange, e-mail encryption, or spam filtering, you need to make sure your vendors are all compliant with HIPAA and that they will sign a Business Associate Agreement with you.
  • Look at all the services your regulated clients need. Include in your project and managed service proposals clear links between your clients’ needs and your services. For example, when installing replacement equipment, describe in detail the steps you will take to properly wipe and dispose of devices being replaced that have stored any ePHI. Link your managed services to your client’s needs and include reports that directly tie to your clients’ HIPAA requirements.

About Mike Semel
mike-semel-hipaa-consulting
Mike Semel is the President and Chief Compliance Officer for Semel Consulting. He has owned IT businesses for over 30 years, has served as the Chief Information Officer for a hospital and a K-12 school district, and as the Chief Operating Officer for a cloud backup company. Mike is recognized as a HIPAA thought leader throughout the healthcare and IT industries, and has spoken at conferences including NASA’s Occupational Health conference, the New York State Cybersecurity conference, and many IT conferences. He has written HIPAA certification classes and consults with healthcare organizations, cloud services, Managed Service Providers, and other business associates to help build strong cybersecurity and compliance programs. Mike can be reached at 888-997-3635 x 101 or mike@semelconsulting.com.

October 10, 2016 I Written By