Phase 2 of the Department of Health and Human Services’ Office for Civil Rights HIPAA compliance audits are now well underway. Late last year, covered entities were selected for desk audits and the first round of audits have now been completed. Now OCR has moved on to auditing business associates of covered entities.

At HIMSS17, OCR’s Deven McGraw explained that the full compliance audits, which were initially penciled in for Q1, 2017, are to be delayed. This gives covered entities more time to prepare.

The phase 2 HIPAA compliance desk audits were more detailed than the first phase of audits conducted in 2011/2012. The desk audits covered a broad range of requirements of the HIPAA Privacy, Security, and Breach Notification Rules, although they only consisted of a documentation check to demonstrate compliance.

The onsite audits will be much more thorough and will look much deeper into organizations’ compliance programs. Not only will covered entities be required to show auditors documentation demonstrating compliance with HIPAA Rules, OCR will be looking for evidence of HIPAA in action.

To help with the audit preparation process, the American Health Information Management Association (AHIMA) has updated its HIPAA audit readiness toolkit. The toolkit can be used by covered entities to assess their compliance efforts and determine whether they have all the necessary documentation, policies, and procedures in place to meet all Health Insurance Portability and Accountability Act requirements.

The new toolkit details the legal process of the HIPAA compliance audit program, OCR processes, and now incorporates the updated HIPAA audit protocol used by OCR in the second phase of the compliance audits.

The new toolkit contains HIPAA compliance checklists covering policies, procedures, and documentation that is likely to be requested by Office for Civil Rights auditors, together with a master policy template for the privacy and security rule compliance program.

AHIMA has also included tips and best practices that can be adopted by HIPAA-covered entities and their business associates to help them meet all of their responsibilities along with an HIPAA audit preparation guide.

AHIMA members can access the HIPAA audit readiness toolkit free of charge in the HIM Body of Knowledge section of the AHIMA website or through its web store.

The onsite audits may have been delayed, but covered entities should ensure they are ready for an audit. Even if the audits slip into 2018 as hinted by McGraw, OCR still investigates all breaches of more than 500 records. In the event of a data breach, OCR will require evidence of compliance with HIPAA Rules and heavy fines await organizations found not to have complied with the HIPAA Privacy, Security and Breach Notification Rules.

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The Health Insurance Portability and Accountability Act’s Breach Notification Rule requires all covered entities to report breaches of unsecured electronic protected health information to the Department of Health and Human Services’ Office for Civil Rights.

While large data breaches – those impacting 500 or more individuals – must be reported to OCR within 60 days of the discovery of the breach, covered entities can delay the reporting of smaller data breaches.

While patients must be notified of any breach of their ePHI within 60 days – regardless of the number of individuals affected by the breach – notifications of security incidents are not required by OCR until 60 days after the end of the calendar year in which the data breaches were discovered.

The deadline for reporting 2016 healthcare data breaches impacting fewer than 500 individuals is March 1, 2017.

As with larger data breaches, all smaller incidents must be submitted via the OCR breach reporting tool. While smaller data breaches can be reported together, each breach must be entered into the breach reporting tool separately along with any supporting information.

Even if the full details of the breach are not yet known, covered entities should submit the reports before the March 1 deadline. An addendum can be added to the breach report when further information becomes available.

It is strongly advisable to designate the reporting of breaches to one individual and for the process of uploading the breach reports to start as soon as possible. Covered entities should not wait until February 28 or March 1 to upload their breach reports. The late reporting of healthcare data breaches would be a violation of the HIPAA Breach Notification Rule, and as we have already seen this year, fines for late breach notifications can be – and are – issued.

In January, OCR took action against Presense Health Network for unnecessarily delaying the issuing of breach notification letters to patients. Presense Health was required to pay OCR $475,000 to settle the case.

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At HIMSS17, OCR’s Deven McGraw shed some light on the HIPAA guidance OCR expects to release in 2017. OCR may be busy with assessing the findings of the HIPAA compliance desk audits of healthcare organizations and their business associates, but a swathe of new HIPAA guidance is set to be released this year.

Last year, the Joint Commission lifted the ban on the use of text messages for orders, although within weeks of the announcement the ban was back in place. Late last year, the Joint Commission partially lifted the ban, saying the use of a secure text messaging platform was acceptable for doctors when communicating with each other, although the use of text messages – regardless of whether a secure, HIPAA-compliant platform was used – remained prohibited.

OCR receives many questions from physicians and covered entities on the use of text messaging and HIPAA Rules. McGraw has confirmed that in response to the many questions, OCR will be issuing HIPAA guidance on text messaging later this year.

In an interview with Information Security Media Group, McGraw explained “There are a lot of questions whether covered entities can text with patients and whether employees within covered entities can text one another, or text covered entity to covered entity, covered entity to business associate, or covered entity to public health department.”

In the guidance, OCR will cover the use of text messages between physicians, healthcare organizations, and the sending of messages to patients, along with the circumstances under which the use of text messages is prohibited by HIPAA Rules.

Last year, there were a number of instances of healthcare professionals accidentally disclosing the protected health information of patients on social media sites and deliberately posting images and videos containing personally identifiable information.

While it is clear to most healthcare professionals what is, and what is not, allowable under HIPAA Rules, guidance on the use of social media platforms will be issued including explanations on when prior authorization from a patient is required.

McGraw also said OCR is working to address its FAQ section on its website as many posted answers are ‘horribly out of date.’

To improve transparency, OCR has been working on guidance on what covered entities can expect then OCR investigators come knocking. OCR investigates all data breaches that have impacted more than 500 individuals, yet how those investigations take place remains something of a mystery. OCR will be releasing an “Anatomy of a Case,” in which the processes that take place when OCR investigates a healthcare data breach or complaint are explained. The guidance will detail how CMPs are calculated and settlements are reached, including the criteria used by OCR when determining appropriate financial penalties.

Much of the guidance has already been written, although it must now be passed to OCR’s legal team. Once that process has been completed, and OCR has made the document readable again, the new guidance will be released.

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In an interview at HIMSS17 with the Information Security Media Group, Deven McGraw, Deputy Director of Health Information Privacy at the Department of Health and Human Services’ Office for Civil Rights, explained that the Phase 2 HIPAA compliance audits are progressing, although the onsite audits of covered entities will be delayed.

It is currently unclear how much of a delay there will be. The onsite audits were to immediately follow the 211 desk audits that were conducted last year, although the decision has been taken to push back the onsite audits until the reports of the desk audits have been written and analyzed.

For the HIPAA compliance desk audits, covered entities and business associates of covered entities were sent notifications that they had been selected for audit. They were asked to supply a range of documentation on various aspects of their HIPAA compliance programs. The documentation has now been assessed and OCR is very close to issuing reports to the 166 covered entities that were audited. Those reports will be sent out in groups, with the first batch hopefully sent by the end of this week.

Covered entities will be provided with the opportunity to comment on the findings of the audits before the reports are finalized. Business associate audits are continuing, with some audit notifications only sent recently. In total, 45 business associates of covered entities were selected for audit.

The onsite audits will be conducted on a small selection of geographically representative covered entities. Last year, when OCR announced the start of the second phase of HIPAA compliance audits, the onsite audits were expected to be conducted in the first quarter of 2017. However, Deven McGraw said the onsite audits are to be delayed. It is hoped that the onsite audits will still take place this year, although they may “slip into 2018.”

The reason for the delay is it makes more sense to hold fire on the onsite audits until the results of the desk audits are assessed. No final decision has been made on the timescale, although it is possible that the final report for the public on the results of the desk audits may be issued before the onsite audits begin.

Input will also be sought from Tom Price, the new secretary for the Department of Health and Human Services. Secretary Price may have views on how the audits are conducted, which will need to be factored in before the audits commence. McGraw also explained that the desk audits have been an “enormous resource-intensive effort” and OCR does not want to “take on more than it can chew.”

However, while OCR is busy with the audit process, there will be no let up on OCR enforcement activities in 2017. The same pace of HIPAA enforcement activities will continue throughout the year.

The interview with Deven McGraw and further information on OCR’s plans for HIPAA enforcement in 2016 can be found on this link.

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The Department of Health and Human Services’ Office for Civil Rights (OCR) has matched last year’s record HIPAA settlement with Advocate Health. Yesterday, OCR announced that a $5.5 million settlement had been reached with Florida-based Memorial Healthcare Systems to resolve potential Privacy Rule and Security Rule violations.

Memorial Healthcare Systems has paid the penalty for non-compliance with HIPAA Rules, and in addition to the $5.5 million settlement, a robust corrective action plan must be adopted to address all areas of non-compliance.

Memorial Healthcare Systems operates six hospitals in South Florida, with its flagship hospital one of the largest in the state. The healthcare system also operates a range of ancillary healthcare facilities, a nursing home, urgent care center, and is affiliated with many physician offices through an Organized Health Care Arrangement (OHCA).

In 2012, Memorial Healthcare discovered a breach of ePHI had occurred. The breach was reported to OCR on April 12, 2012.  That breach related to two employees who were discovered to have inappropriately accessed patients’ ePHI including names, birth dates, and social security numbers. Federal charges were brought against the individuals for selling on stolen ePHI and filing fraudulent tax returns, although OCR investigated to determine whether there were any underlying violations of HIPAA Rules that contributed to the exposure and theft of PHI. Memorial Healthcare was investigated by OCR in the summer of 2012.

Memorial Healthcare also conducted its own investigation which revealed that those two employees were not the only individuals to have inappropriately accessed ePHI. Memorial Healthcare’s investigation determined that 12 individuals at its affiliated physician offices had also inappropriately accessed the ePHI of patients. In total, the ePHI of 115,143 individuals was impermissibly accessed by its employees.

The investigation revealed that the login credentials of a former employee of one of its affiliated physician offices had been used to access the ePHI of patients on a daily basis for a period of a year. The login credentials were discovered to have first been used to access ePHI without authorization in April 2011, and access continued until April 2012, when the improper access was detected and blocked. The ePHI of 80,000 patients had been accessed using those login credentials.

In accordance with HIPAA Rules, Memorial Healthcare system had implemented policies and procedures covering ePHI access by its workforce, but the healthcare system had failed to implement procedures to review and modify users’ access rights to ePHI when access was no longer required. Several risk analyses had previously been conducted between 2007 and 2012 which highlighted the risk to ePHI.

Inappropriate access by its employees and staff at affiliated physician offices continued for a year, yet Memorial Healthcare did not notice as reviews of information system activity were not regularly checked.

OCR investigators determined that Memorial Healthcare had violated HIPAA Rules (45 C.F.R. §§160.103 and 164.502 (a))) by providing access to PHI to a former employee of an affiliated physician practice between April 1, 2011 and April 27, 2012.

A violation of 45 C.F.R. §164.308(a)(l)(ii)(D) occurred between January 1, 2011 and June 1, 2012, as regular reviews of records of information system activity had not been performed.

45 C.F.R. § 164.308(a)(4)(ii)(C) had also been violated by failing to modify a user’s right of access to a workstation, transaction, or program allowing ePHI to be impermissibly accessed.

Each HIPAA violation carries a maximum penalty of $1.5 million, per year that each violation was allowed to persist. Had Memorial Healthcare not agreed to settle with OCR, the financial penalty would have been considerably higher.

This HIPAA settlement brings the annual total up to three settlements and one Civil Monetary Penalty (CMP). Earlier this month, OCR announced a $3.2 million CMP for Children’s Medical Center of Dallas. In January, a settlement of $2.2 million was agreed with MAPFRE Life Assurance Company of Puerto Rico for impermissible disclosure of ePHI, and a $475,000 settlement was agreed with Presense Health to resolve HIPAA Breach Notification Rule violations.

OCR Acting Director Robinsue Frohboese announced the latest HIPAA settlement saying “Access to ePHI must be provided only to authorized users, including affiliated physician office staff.” Frohboese also explained that “Organizations must implement audit controls and review audit logs regularly. As this case shows, a lack of access controls and regular review of audit logs helps hackers or malevolent insiders to cover their electronic tracks, making it difficult for covered entities and business associates to not only recover from breaches, but to prevent them before they happen.”

At the current rate, last year’s record breaking year for HIPAA settlements will be eclipsed in 2017. The regularity of HIPAA settlements and CMPs should send a strong message to covered entities that OCR is coming down hard on organizations discovered to have violated HIPAA Rules and exposed patients’ protected health information.

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