Hipaa Law Violations: Understanding The Consequences And Risks

Breaking HIPAA laws can result in serious consequences, including costly fines and even jail time. The penalties depend on the nature and consequences of the violation, the motive, and whether the violation was accidental or intentional. Civil penalties are imposed on individuals who commit violations unintentionally, such as due to forgetfulness or lack of awareness. Criminal penalties, on the other hand, are harsher and apply to intentional violations, with fines ranging from $50,000 to $250,000 and potential jail sentences of up to ten years.

Criminal vs civil violations

The penalties for breaking HIPAA laws vary depending on the nature and consequences of the violation, the motive for the violation, and whether the violation was identified. They are enforced by the US Department of Health and Human Services (HHS) Office for Civil Rights (OCR).

Civil Violations

If a complaint is made to the OCR, the agency may conduct a compliance review, which could result in a corrective action plan or, if the violation was attributable to a lack of training, a full investigation. Further civil monetary penalties could be issued by a State Attorney General or by a civil court if the impermissible disclosure of PHI resulted in the patient suffering personal harm (e.g. identity theft).

Civil monetary penalties (CMPs) for HIPAA violations are determined based on a tiered civil penalty structure. The penalty ranges are as follows:

• Unknowing violation: $100 - $50,000 per violation, with an annual maximum of $25,000 for repeat violations.
• Reasonable cause: $1,000 - $50,000 per violation, with an annual maximum of $100,000 for repeat violations.
• Willful neglect, corrected within 30 days: $10,000 - $50,000 per violation, with an annual maximum of $250,000 for repeat violations.
• Willful neglect, not corrected within 30 days: $50,000 per violation, with an annual maximum of $1.5 million.

Criminal Violations

Criminal violations of HIPAA are handled by the Department of Justice (DOJ). Criminal penalties are directly applicable to covered entities (CE) including healthcare clearinghouses, healthcare providers who transmit claims in electronic form, and Medicare prescription drug card sponsors. Individuals such as directors, employees or officers of the CE may also be directly criminally liable under HIPAA in accordance with "corporate criminal liability".

The criminal penalties for sharing passwords in violation of HIPAA depend on the motive for knowingly and wrongfully disclosing individually identifiable health information. Just doing it could, in theory, attract a fine of up to $50,000 and a jail sentence of up to a year. In the event that the junior colleague obtained the patients' health information and disclosed it to someone else, they could receive:

• A fine of up to $100,000 and up to five years in jail if the offense was committed under false pretenses.
• A fine of up to $250,000 and up to ten years in jail if the offense was committed to sell, transfer, or use the PHI for commercial advantage, personal gain, or malicious harm.

Civil penalties

• If an individual was unaware that they were violating HIPAA Rules, they will be fined $100 for each violation.
• If an individual had reasonable cause for their actions and was not willfully neglectful, they will be fined a minimum of $1,000.
• Even if the individual was acting with willful neglect, as long as they fixed the issue afterward, they will be fined a minimum of $10,000 per violation.
• If an individual acted with willful neglect and failed to fix the issue, they will be fined a minimum of $50,000 per issue.

The penalties for civil violations are severe, but they are less harsh than those for criminal violations, which are imposed when violators have malicious intent.

Criminal penalties

The criminal penalties for breaking HIPAA laws are divided into three tiers, with the term and fine decided by a judge based on the facts of each case. The Department of Justice prosecutes criminal HIPAA violations and has been taking action against individuals who have knowingly violated HIPAA Rules.

The criminal penalties for sharing passwords in violation of HIPAA depend on the motive for knowingly and wrongfully disclosing individually identifiable health information. Just doing it could, in theory, attract a fine of up to $50,000 and a jail sentence of up to a year.

If the offence is committed under false pretenses, the penalty can increase to a fine of up to $100,000 and a prison sentence of up to five years.

If the offence is committed with the intent to sell, transfer, or use individually identifiable health information for commercial advantage, personal gain, or malicious harm, the penalty can increase to a fine of up to $250,000 and a prison sentence of up to ten years.

In addition, if an individual has profited from the theft, access, or disclosure of protected health information, it may be necessary for all money received to be refunded, in addition to the payment of a fine.

The three tiers of criminal penalties for breaking HIPAA laws are:

• Reasonable cause or no knowledge of violation – Up to 1 year in jail
• Obtaining protected health information under false pretenses – Up to 5 years in jail
• Obtaining protected health information for personal gain or with malicious intent – Up to 10 years in jail

Self-reporting

• Understanding HIPAA Compliance: It is essential to comprehend the scope of HIPAA laws. The Health Insurance Portability and Accountability Act (HIPAA) protects individuals' privacy by establishing guidelines to prevent the unauthorized disclosure of Protected Health Information (PHI). This includes medical treatment billing information, prescription drug details, health records, and insurance company records.
• Identifying HIPAA Violations: A HIPAA violation occurs when any of the standards set by the HIPAA Security Rule are not met. This includes unauthorized use or disclosure of PHI, delayed breach notifications, failure to protect PHI through appropriate measures, and not conducting regular risk analyses.
• Consequences of HIPAA Violations: The consequences of violating HIPAA can vary depending on the nature and impact of the violation. Consequences may include corrective action plans, civil or criminal charges, and monetary penalties. The Office for Civil Rights (OCR) investigates external complaints and attempts to obtain voluntary compliance before imposing consequences.
• Self-Reporting Process: If a covered entity discovers a breach of unsecured PHI, they must notify the Secretary of Health and Human Services (HHS) using the designated web portal. The notification timeframe depends on the number of individuals affected by the breach. If it affects 500 or more individuals, the entity must notify the Secretary without unreasonable delay and within 60 calendar days. For breaches affecting fewer than 500 individuals, the entity can notify the Secretary annually, with reports due no later than 60 days after the end of the calendar year in which the breaches are discovered.
• Business Associate Notification: In the case of a breach occurring at or by a business associate, they must notify the covered entity promptly and no later than 60 days from the discovery of the breach. The business associate should provide the covered entity with the identification of affected individuals and relevant information for notification.
• Administrative Requirements: Covered entities and business associates must maintain documentation demonstrating that required notifications have been provided or that a use or disclosure of PHI did not constitute a breach. They must also have written policies and procedures for breach notification, provide employee training, and apply sanctions for non-compliance.
• Preventative Measures: To prevent HIPAA violations, organizations should implement comprehensive protocols, conduct routine risk assessments, provide regular employee training, and establish clear HIPAA regulations.

Compliance training

HIPAA compliance training should include an introduction to HIPAA, covering the three major components: Privacy, Security, and Breach Notification Rules. Employees should understand how these rules apply to the healthcare industry and their specific obligations. This includes recognising Protected Health Information (PHI), understanding proper uses and disclosures of PHI, knowing how to keep PHI secure, and learning how to report a breach of PHI.

Additionally, cybersecurity best practices should be covered in compliance training. This includes training on creating strong passwords, not sharing login credentials, recognising phishing emails, and other tactics to keep the organisation's information safe.

It is also important to note that compliance training should be tailored to the specific organisation. Each organisation is required to have unique HIPAA policies and procedures to meet its specific needs, and employees should be trained on these internal privacy and security policies.

To ensure effective compliance training, employers can utilise a variety of resources, such as online training courses, in-person training sessions, and providing written policies and procedures. Regular risk assessments and internal audits can also help identify areas where additional training may be needed.

By providing comprehensive compliance training, organisations can reduce the risk of breaches and ensure that employees are aware of the importance of protecting sensitive health information.

Frequently asked questions