The Downside To Sharing – Two Hospitals To Pay Largest HIPAA Fine Yet

by Akerman LLP - Health Law Rx

On May 7, 2014, the U.S. Department of Health and Human Services Office for Civil Rights  ("OCR") announced the largest settlement to date under the Health Insurance Portability and Accountability Act of 1996 ("HIPAA").  New York and Presbyterian Hospital ("NYP") and Columbia University ("Columbia") agreed to pay $4.8 million and enter into resolution agreements as the result of a breach of NYP's data system resulting in the disclosure of personal information of 6,800 patients.  

NYP and Columbia are each covered entities under HIPAA and participate in a joint arrangement where they operate a shared data network and a shared network firewall that is administered by employees of both entities.  The shared network links to NYP patient information systems containing electronic protected health information ("e-PHI").

The breach occurred when a Columbia physician tried to deactivate a personally-owned computer server on the network containing the e-PHI of NYP patients.  According to OCR, due to a lack of technical safeguards, deactivation of the server resulted in e-PHI being accessible on internet search engines.  NYP and Columbia learned of the breach after receiving a complaint from an individual who found the e-PHI of the individual's deceased partner, a former patient of NYP, on the internet.  The OCR investigation revealed that neither NYP or Columbia made efforts before the breach to ensure that the server was secure and contained appropriate software protections, and neither entity conducted an accurate risk analysis that identified all systems that access patients' e-PHI.

Under the settlement agreement, NYP will pay $3,300,000 and Columbia will pay $1,500,000.  Also, the entities entered into separate resolution agreements that require corrective action.  The corrective steps that NYP must take include:

  • Modify its existing risk analysis process, including developing a complete inventory of all electronic equipment, data systems, and applications that contain or store e-PHI;
  • Develop and implement a risk management plan to address and mitigate security risks and vulnerabilities found in the risk analysis.  The plan must be reviewed by OCR;
  • Review and revise policies and procedures for authorizing access to NYP e-PHI;
  • Implement a process for evaluating environmental and operational changes that affect the security of NYP e-PHI;
  • Review and revise policies and procedures on device and media controls, including identifying criteria for the use of such devices and procedures for obtaining authorization for the use of personal devices and media that use NYP e-PHI systems;
  • Develop an enhanced privacy and security awareness training program to train workforce members and affiliated staff on the necessity of prohibitions on the purchase, use or administration of computer equipment that accesses NYP e-PHI, except under the explicit management of NYP IT personnel.

Columbia must take many of the same corrective steps.  NYP's corrective action plan also requires it to collaborate with Columbia to implement the corrective actions described above.

In addition to being the largest HIPAA settlement to date, this is the first settlement involving multiple covered entities.  According to a statement by an OCR spokeswoman, "When entities participate in joint compliance arrangements, they share the burden of addressing the risks to [PHI].  Our cases against NYP and [Columbia] should remind health care organizations of the need to make data security central to how they manage their information systems."

This settlement is another reminder of the importance that OCR places on an accurate risk analysis that identifies all places within a system that e-PHI resides.  To avoid shared settlement payments, covered entities that permit shared access to e-PHI should closely read the NYP and Columbia resolution agreements and implement the described action items. 

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.

© Akerman LLP - Health Law Rx | Attorney Advertising

Written by:

Akerman LLP - Health Law Rx

Akerman LLP - Health Law Rx 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):

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.


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 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:

- 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.