OCR Settles with Shasta Regional Medical Center for $275,000

by Baker Donelson
Contact

The HHS Office of Civil Rights (OCR) recently announced a $275,000 settlement with Shasta Regional Medical Center (SRMC) on the heels of an investigation triggered by a Los Angeles Times article indicating that senior hospital officials had disclosed information regarding a patient’s treatment without her consent. In addition to the monetary settlement, SRMC was required to execute a one-year Corrective Action Plan (CAP) that requires SRMC to modify its policies and procedures, retrain its employees, and submit annual reports. The CAP also requires that 16 facilities related to SRMC submit to OCR an attestation indicating that they understand that an individual’s PHI remains protected even when it has been disclosed by the individual herself or otherwise made a part of the public record and that disclosures of PHI to the media always require the patient’s authorization.

SRMC’s troubles began in in the wake of an investigation of its billing practices. California Watch, a California news outlet following the billing investigation, reported that the hospital had billed for treating a patient for a severe form of malnutrition (even though the patient was overweight and indicated she received no such treatment). In response, hospital executives (acting through SRMC’s parent company, Prime Healthcare) released the patient’s medical record to several media outlets, with at least one executive claiming that the patient “waived” her privacy rights when she discussed her care with the media. The OCR disagreed.

SRMC’s Violations

OCR’s Resolution Agreement (RA) (which also attaches a copy of the CAP) [PDF] provides some detail regarding the categories of noncompliance it identified as justifying the monetary settlement and CAP:

  • SRMC “failed to safeguard the [patient’s] PHI” from impermissible disclosure when it intentionally released the patient’s record to California Watch, The Record Searchlight, and the Los Angeles Times;
  • SMRC impermissibly used the patient’s information when it sent an email to its entire workforce containing much of the same information shared with the media outlets; and
  • SRMC “failed to sanction its workforce members pursuant to its internal sanctions policy which requires that it sanction employees for ‘violations of HIPAA.’”

SRMC’s CAP

A settlement with OCR generally requires not only a cash payment but also a commitment to a (generally, two-year) Corrective Action Plan. (For a detailed discussion of corrective action plans, see “Corrective Action Plans Can Mean Significant Compliance Monitoring Requirements.”) These plans are intended to ensure ongoing compliance much in the same fashion as Corporate Integrity Agreements are intended to ensure ongoing compliance following a settlement with the HHS OIG. The two agreements also obligate the provider to significant ongoing reporting and auditing responsibilities, as well as potentially substantial costs related to a diversion of enterprise resources and the retention of (and satisfaction of) an outside auditor.

Notably, the CAP requires that SRMC correct its policies and procedures (with regard to both disclosures and discipline) and submit them for approval, submit annual reports, and retrain its employees; but it does not require the engagement of an outside monitor, the submission of monitor reports, or the imposition of any (announced or unannounced) site inspections. Interestingly, the CAP also requires that the 16 other facilities owned and operated by Prime Healthcare submit attestations indicating that they are aware that the HIPAA implementing regulations prohibit the disclosure of a patient’s medical record to a media outlet without the patient’s authorization, even where the record has been requested by the media.

In the event that SRMC fails to fulfill its responsibilities under the CAP, of course, SRMC would remain subject not only to an additional investigation and any penalties resulting from the conduct that breached the CAP, but OCR would no longer be bound by the settlement’s release.

Ober|Kaler's Comments

The SRMC settlement is instructive in several ways:

  • It appears difficult to argue with OCR’s determination in this case – the facts behind the disclosure, and the reported statements of the hospital’s officials are not in dispute. Sending a patient’s medical records to a news organization without the patient’s authorization does not seem to be a “grey” area of HIPAA compliance, even if the patient has already spoken of the underlying medical condition publically.
  • HIPAA compliance is not an issue which can be relegated to “compliance people.” Compliance is enterprise wide. Every employee (including senior management) should have a familiarity with HIPAA and its regulations (and facility policies) sufficient to accomplish their work in a compliant manner and to notice when issues implicating privacy concerns arise. Not everyone needs to be a Privacy Officer, but everyone should know when to call the Privacy Officer.
  • Policies and procedures, including policies concerning sanctions and discipline, must be followed, even if senior management must be sanctioned. Such sanctions can be undertaken by the organization’s Board of Directors as necessary.
  • The size of a breach doesn’t necessarily dictate OCR’s reaction. While every breach of more than 500 patients will be investigated, OCR may, and will, investigate smaller breaches where it believes it has good cause.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Baker Donelson | Attorney Advertising

Written by:

Baker Donelson
Contact
more
less

Baker Donelson on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Privacy Policy (Updated: October 8, 2015):
hide

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.

Security

JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.