Comstar, a Massachusetts-based ambulance billing and collections company, has been investigated by the Massachusetts Attorney General and found to have violated the Health Insurance Portability and Accountability Act (HIPAA) and the Massachusetts Data Security Regulations. Comstar will pay a $515,000 penalty to resolve the alleged violations.

Comstar was investigated over a March 2022 cyberattack and data breach. A cyber threat actor breached its network, exfiltrated files, and used ransomware to encrypt data on its network. While the attack was detected on March 26, 2022, the ransomware group gained access to its network on March 19, 2026. The forensic investigation confirmed that protected health information (PHI) had been stolen, including names, Social Security numbers, driver’s license numbers, financial information, and medical assessment information. The PHI of 585,621 individuals was compromised in the ransomware attack, including 326,426 Massachusetts residents and 22,829 Connecticut residents.

The Rowley, Massachusetts-based company faced an investigation by the Department of Health and Human Services Office for Civil Rights (OCR), which determined that Comstar failed to conduct a comprehensive and accurate risk analysis to identify risks and vulnerabilities to the confidentiality, integrity, and availability of electronic protected health information (ePHI) stored within its systems. The alleged HIPAA violation was resolved with a $75,000 financial penalty and a corrective action plan.

An investigation was also launched by the Massachusetts Attorney General to assess whether Comstar had complied with HIPAA, the Massachusetts Consumer Protection Act, the Massachusetts Data Security Regulations, and the Massachusetts Data Security Law. The Connecticut Attorney General partnered with the Massachusetts Attorney General in the investigation. Massachusetts Attorney General Andrea Campbell alleged that Comstar had violated HIPAA and the Massachusetts Data Security Regulations by failing to maintain an adequate Written Information Security Program (WISP), which should have allowed the company to identify and correct vulnerabilities and inadequacies in its data security program.

The consent judgment was filed in Suffolk Superior Court on January 28, 2026, and awaits approval from the court. If approved, Massachusetts will receive $415,000, and Connecticut will received $100,000. In addition to the financial penalty, Comstar is required to implement additional security measures. An effective WISP must be established and maintained, as well as anti-phishing software, multifactor authentication, an intrusion detection/prevention system, and a security incident and event management platform.

Comstar must also implement and maintain a comprehensive and accurate IT asset inventory, appropriate access controls, password policies requiring strong unique passwords for all accounts, encryption for ePHI at rest and in transit, data loss protection software, a penetration testing program, and security software on all laptop and desktop computers. Comstar must also arrange for third-party annual security assessments to be conducted for the next three years. The Massachusetts and Connecticut Attorneys General require reports to be submitted by the third-party assessor on the findings of each annual security risk assessment.

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The HHS’ Office for Civil Rights has increased the penalties for HIPAA violations with immediate effect. As of January 28, 2026, the penalties have been increased in line with inflation, as mandated by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015. Annual adjustments to the penalty amounts are necessary to maintain the deterrent effect of financial penalties.

When the HITECH Act was introduced, the penalties for HIPAA violations were set as follows:

• Tier 1: Minimum fine of $100 per violation up to $50,000
• Tier 2: Minimum fine of $1,000 per violation up to $50,000
• Tier 3: Minimum fine of $10,000 per violation up to $50,000
• Tier 4: Minimum fine of $50,000 per violation up to $1,500,000

The penalties were capped at $1,500,000 for violations of an identical provision in a calendar year, and all penalties are subject to annual increases in line with inflation. OCR, like all other Executive Departments and Agencies, is required to apply annual increases to its penalty amounts. Each year, the Office of Management and Budget (OMB) issues a Memorandum that includes a multiplier for the annual adjustment.

All Executive Departments and Agencies are required to apply the multiplier by the specified date, which for the 2025 increase was January 17 last year. The HHS is often late in applying the annual adjustment to its penalties. The previous adjustment to the penalty amounts was applied on August 8, 2024. While the 2025 adjustment was due to be applied by January 17, 2025, it was not applied until January 28, 2026, more than a year late. OMB has yet to announce the inflation multiplier for 2026.

The new penalty amounts are effective from the date of publication in the Federal Register. If the violation occurred before November 2, 2015, or a penalty was assessed before September 6, 2016, the pre-adjustment civil penalty amounts in effect before September 6, 2016, will apply.

2025 Penalties for HIPAA Violations

While these are the official penalty amounts, OCR has not rescinded its 2019 Notice of Enforcement Discretion. In 2019, OCR reviewed the text of the HITECH Act and determined there had been a misinterpretation. OCR issued a Notice of Enforcement Discretion, lowering the maximum penalties and annual caps in three of the four penalty tiers. The effective penalties for HIPAA violations, per the Notice of Enforcement Discretion, are detailed in the table below. OCR can rescind the Notice of Enforcement Discretion at any point, but cannot change the penalties detailed in the table above without further rulemaking.

Penalties for Violations of the Part 2 Regulations

Violations of the Part 2 regulations are now enforced by OCR, following the update to the Part 2 regulations to align them more closely with HIPAA. While violations are penalized with the same penalty structure as HIPAA, the penalties are not the same. OCR has taken the starting point to be the penalty amounts stipulated by the HITECH Act of 2009, rather than the current penalty amounts for HIPAA violations, which have increased annually in line with inflation since 2009. As such, violations of the Part 2 regulations are penalized less severely than violations of the HIPAA Rules, despite Part 2-covered data being considered more sensitive. Per the recent publication in the Federal Register, the penalties for violations of the Part 2 regulations are as follows.

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A recent study exploring insider cybersecurity threats revealed that a majority of college students would be willing to violate the HIPAA Rules and steal and disclose patient data if they were paid to do so, provided the price was right. The amount of money required ranged from less than $10,000 to more than $10 million. The study was conducted by Lawrence Sanders, professor emeritus, University of Buffalo, Department of Management Science and Systems, and colleagues at the School of Management, and builds on a 2020 study that explored the price of healthcare privacy violations.

The 2020 study, published in JMIR Medical Informatics, was conducted on 523 students (average age of 21) who were about to enter the workforce. The respondents were asked to imagine that they had been employed by a hospital, and were given five scenarios in which they were asked if they would illegally obtain and disclose sensitive health information. 46% of respondents admitted that they would violate HIPAA and patient privacy if the price was right. In one of the scenarios, study participants were asked if they would obtain and disclose a politician’s medical records in exchange for $100,000, if the money was needed to pay for an experimental treatment for their mother that insurance wouldn’t cover. 79% of respondents said they would.

The follow-up study, which focused on cybersecurity insiders, was conducted on 500 undergraduate college students in technology-related programs, who represented future IT workers in the healthcare industry. They were asked to imagine they had been employed by a hospital, were being paid between $30,000 and $100,000, and were under financial stress and had been approached and asked to obtain and leak information about a famous patient at the hospital.

They were informed about HIPAA and how the federal law prohibited unauthorized access and disclosure of protected health information, yet 58% said they would violate HIPAA in exchange for payment. The amount of money required was less than $10,000 in some cases, and whether they would be tempted – and the amount required – varied depending on the employee’s salary leveland the perceived probability of being caught. The higher the employee’s salary, the more money was required to violate HIPAA and steal data. Individuals who had an interest in ethical hacking generally required less money to violate HIPAA, as was the case with individuals with an interest in unethical hacking, if they were assured that they would not be caught.

The study highlights the risk of insider data breaches and the importance of training on the HIPAA Privacy Rule requirements and the consequences of HIPAA violations, making it clear to all workers that if violations are discovered, the consequences of HIPAA violations can be severe.

“As cyberattacks and data breaches continue to rise, particularly in health care and other data-intensive sectors, our findings underscore the need for organizations to address the human and economic dimensions of cybersecurity alongside traditional technical controls,” said Professor Sanders. “Promoting awareness and education can discourage people from engaging in cybercrime by highlighting the negative consequences and risks associated with it. Initiatives that promote economic opportunity, social inclusion, cybersecurity literacy and a more secure digital environment are part of the solution.”

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In January 2021, the Department of Health and Human Services (HHS) Office for Civil Rights (OCR) published a proposed update to the HIPAA Privacy Rule – Modifications to the HIPAA Privacy Rule to Support, and Remove Barriers to, Coordinated Care and Individual Engagement.

The purpose of the update is to revise the HIPAA Privacy Rule to strengthen individuals’ rights to access their own health information, improve care coordination, and reduce the compliance burden on healthcare providers and health plans, while continuing to protect the privacy of patients. Under the Biden administration, the proposed update did not appear to be a priority for the HHS, and there have been no signs during the first year of the new Trump administration that a final rule is any closer to being published; however, that changed on January 14, 2026, when OCR Director Paula M. Stannard published a notification of Tribal consultation on the 2021 Rule in the Federal Register.

It has been five years since the proposed update to the HIPAA Privacy Rule was published in the Federal Register, and while there has been little mention of the proposed update over the past half-decade, a final rule appears to be close to publication. Ahead of the final rule, a Tribal consultation meeting will be held virtually via Zoom on February 6, 2026, pursuant to Executive Order 13175 and the HHS Tribal Consultation Policy.

The consultation will cover several different topics, with OCR seeking feedback on the proposed changes to strengthen individuals’ rights to their own health information; the measures proposed to improve care coordination and case management; the enhanced flexibilities for disclosures of patient information in emergencies and threatening circumstances; the support for the use of telecommunications relay services by individuals and workforce members who are deaf, hard of hearing, deaf-blind, or who have a speech disability;  and the expanded permission to use and disclose the PHI of Armed Forces service personnel for national readiness purposes.

While the Tribal consultation is a sign of progress toward a final rule implementing some or all of the proposed changes, there are no indications at present when the final rule will be published. When and if that time comes, HIPAA-regulated entities will be given sufficient time to update their policies, procedures, and practices and provide training to the workforce on the new Privacy Rule requirements before OCR starts enforcement.

In the meantime, OCR has indicated that it is continuing with its enforcement initiatives targeting the HIPAA Right of Access provision of the HIPAA Privacy Rule, parental access to the medical records of minor children, and the risk analysis provision of the HIPAA Security Rule, and an expansion of that program to cover risk management. OCR has also indicated that a new enforcement initiative will soon be launched for the confidentiality of substance use disorder treatment records, pursuant to the recent changes to the Part 2 regulations to align them more closely with HIPAA.

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The Department of Health and Human Services (HHS) Office for Civil Rights (OCR) is working on a video presentation to explain the requirements of the risk management process of the HIPAA Security Rule and has requested risk management questions from HIPAA-regulated entities.

The risk analysis is a foundational element of the HIPAA Security Rule that requires risks and vulnerabilities to the confidentiality, integrity, and availability of electronic protected health information (ePHI) to be identified. OCR frequently identifies risk analysis failures in its investigations of data breaches, complaints, and through its HIPAA compliance audit program, including incomplete and nonexistent risk analyses. It is the most commonly identified HIPAA Security Rule violation, and a frequent reason for imposing a financial penalty.

OCR has released guidance to help HIPAA-regulated entities conduct a risk analysis, and a downloadable risk assessment tool for small- and medium-sized regulated entities to guide them through the process. After conducting a risk analysis, all identified risks and vulnerabilities to ePHI must be subjected to a risk management process, detailed in § 164.308(a)(1)(ii)(B) of the administrative safeguards of the HIPAA Security Rule. Risk management is defined as “Implement security measures sufficient to reduce risks and vulnerabilities to a reasonable and appropriate level to comply with § 164.306(a) [Security Standards: General Rules].”

Two of OCR’s enforcement actions this year included penalties for risk management failures – the $3,000,000 penalty for Solara Medical Supplies and the $1,500,000 Warby Parker, Inc. HIPAA violation penalty. To clear up any potential confusion about the risk management process, OCR is producing a video presentation – HHS’ OCR Presents: The HIPAA Security Rule: Risk Management.

Nick Heesters, OCR’s Senior Advisor for Cybersecurity, will be covering various aspects of the risk management provision of the HIPAA Security Rule in the presentation. Heesters will flesh out what is required in terms of risk management, the use of cybersecurity resources, and he will provide insights into OCR’s investigations into potential risk management HIPAA violations.

Since this will be a pre-recorded video presentation rather than a live webinar, OCR has requested questions from HIPAA-regulated entities about the risk management requirement of the HIPAA Security Rule, a selection of which will be answered during the presentation. If you have any questions related to risk management, this is an ideal opportunity to get the answers you seek. Questions should be submitted to OCR no later than  December 8, 2025, via email at OCRPresents@hhs.gov

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