The U.S. Department of Health and Human Services (HHS) has reported a $400,000 settlement with Idaho State University (ISU) for alleged violations of the Health Insurance Portability and Accountability Act of 1996 (HIPAA) Security Rule. The incident giving rise to the investigation by the HHS Office for Civil Rights (OCR) involved a potential exposure of information about 17,500 patients over a ten-month period.

OCR has enforcement authority of the HIPAA Privacy and Security Rules. When a breach is reported to HHS, as required by the breach notification rules, OCR typically initiates an investigation regarding the reporting organization’s compliance with the breach notification requirements as well as the state of compliance with the HIPAA Privacy and Security Rules. In this case, OCR concluded that:

(1)  ISU failed to conduct an appropriate risk assessment between April 1, 2007 and November 26, 2012;

(2)  ISU failed to implement adequate security protections during the same time period to protect electronic protected health information (ePHI); and

(3)  ISU did not regularly review information system (IS) activity to determine if ePHI was inappropriately used or disclosed.

These points are all significant and emphasize the importance of a healthcare organization’s actions taken to evaluate its risks and appropriately respond to vulnerabilities. Moreover, point three supports OCR’s expectation that organizations regularly review IS activity (e.g., audit trails and logging) to determine if there has been an impermissible use or disclosure of ePHI, or if the security protections in place need to be changed.

The Resolution Agreement includes a two-year corrective action plan (CAP) in addition to the monetary settlement. The CAP imposes numerous obligations on ISU, including annual reporting requirements as follows:

(1) summary of the risk management plan, security measures, and training;

(2) summary of IS activity review measures and evidence of training related to those measures;

(3) update on compliance gap analysis activity;

(4) summary of reportable events and corrective/preventative action;

(5) attestation from an ISU officer that the annual report is accurate and truthful.

OCR’s 13th resolution agreement demonstrates the priority an organization must place on taking proactive steps to continuously assess and timely respond to risk. In addition, the resolution agreement continues to support the notion that compliance is a C-Suite issue and documentation is critical to support your compliance efforts.

Photo of Theodore J. Kobus III Theodore J. Kobus III

Ted Kobus stands at the forefront of cyber protection — no small role in an era defined by crippling data breaches and daily digital threats. He has earned authority in the areas of privacy, data security and cybersecurity, leading clients to entrust him…

Ted Kobus stands at the forefront of cyber protection — no small role in an era defined by crippling data breaches and daily digital threats. He has earned authority in the areas of privacy, data security and cybersecurity, leading clients to entrust him with more than 6,000 data breach responses. Businesses, government and other organizations turn to Ted for sound advice on compliance, developing response strategies, breaches implicating domestic and international laws, and defense of both class action litigation and regulatory actions. Notably, he has developed key relationships with the U.S. Department of Justice (DOJ), where he and his team have helped to establish protocols to protect corporate victims following a data breach. He knows the most proactive regulators involved in this space and interacts with them regularly.

Ted has led the defense to hundreds of regulatory investigations, including those brought by the Attorney General Multi-State, Department of Health and Human Services Office for Civil Rights, Departments of Insurance, SEC and FTC. In the healthcare space, Ted has defended more than 200 OCR investigations and has negotiated more privacy/security-related resolution agreements than any other lawyer.

Ted is consistently ranked in Chambers USA: America’s Leading Lawyers for Business, and he is one of only a handful of attorneys nationwide named an MVP by Law360 for Privacy and Consumer Protection. He is a regular contributor to BakerHostetler’s Data Counsel blog, and he frequently speaks at major industry events regarding data breach response, risk management and litigation issues affecting privacy. Ted has spoken at the National Association of Attorneys General on data security issues in a closed session, as well as the National Security Cyber Specialist’s Training Conference organized by the DOJ.

Ted is the firmwide chair of BakerHostetler’s Digital Assets and Data Management Group and a member of the firm’s Policy Committee.