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HIPAA has been in force for nearly three a long time, however it’s never been more relevant than today.
The number and value of information breaches is growing. Healthcare regulators are scrambling to meet up with AI. Public health agencies are “addressing a diverse array of issues among an increasingly polarized public”.
Amid all this, corporations have a critical role to play in protecting sensitive data.
One area that’s increasingly under scrutiny is HIPAA compliance. Although HIPAA primarily applies to healthcare organizations, it could affect how your small business handles sensitive information – regardless of your industry.
Table of Contents
What’s HIPAA compliance?
The Health Insurance Portability and Accountability Act or HIPAA is a US law protecting sensitive patient health information (PHI). PHI includes patients’ medical records and health information provided to insurers, doctors, hospitals, and other healthcare providers.
It sets standards for a way organizations can collect, use, store, transmit and disclose individuals’ medical information.
The important thing components of HIPAA compliance
HIPAA compliance means adhering to rules and regulations surrounding the confidentiality, integrity, and availability of PHI.
There are two principal guardrails, the Security Rule and Privacy Rule.
But before diving into the Rules, we’d like to define a couple of technical terms you’ll encounter when looking into HIPAA compliance.
- Protected health information (PHI): Individually identifiable health information transmitted or maintained in any form. This includes names, addresses, birth dates, Social Security numbers and medical records.
- Covered entities: Healthcare providers, health plans, and healthcare clearinghouses that must comply with HIPAA regulations.
- Business associates: Individuals or organizations that perform functions or activities on behalf of a covered entity that involve using, transmitting or disclosing PHI.
Remember this last group because it might apply to your organization.
HIPAA compliance is just not only necessary for “covered entities” but additionally for BPOs and KPOs within the healthcare sector. From call centers to virtual assistants and medical transcription services, any organization handling PHI is prone to be subject to HIPAA.
It may also apply to employers in other industries if the corporate stores, accesses or transfers worker health data.
HIPAA security rule
The HIPAA Security Rule outlines the safeguards organizations must implement to guard patient health information.
- Administrative safeguards: Policies and procedures for managing the safety of electronic PHI, resembling risk evaluation, workforce security and data access management.
- Physical safeguards: Protecting systems and data from unauthorized access, use, disclosure, disruption, modification or destruction. This includes access controls, workstation security, and asset-level (device and media) controls.
- Technical safeguards: Using technology to guard electronic PHI, resembling access control, audit controls, and integrity controls.
The HIPAA privacy rule
The HIPAA Privacy Rule establishes national standards for shielding individuals’ medical records and health information. It specifies patients’ rights to grasp and control how their health information is used:
- Patient rights: Individuals have the precise to access their health information, request amendments to their health records, and receive a notice of privacy practices.
- Permitted disclosures: The precise circumstances under which PHI could be disclosed, including for treatment, payment and healthcare operations.
- Minimum essential: Covered entities must disclose only the minimum PHI essential to perform a selected purpose.
HIPAA compliance also means meeting the Breach Notification Rule and Enforcement Rule.
The Breach Notification Rule outlines how covered entities should reply to a violation, including notifying authorities and affected individuals.
As you may’ve guessed, the Enforcement Rule establishes the rules for regulators to research, penalize, and in some cases prosecute HIPAA violations.
Does HIPAA apply to all employers?
Healthcare isn’t the one industry impacted by HIPAA. Other sectors and organizations handling PHI must comply, including insurance and technology corporations providing health-related services.
Unfortunately, HIPAA language is non-specific. It’s often tricky to know whether compliance rules apply to your scenario, fully or partially, and where your responsibilities start and end.
As a very generalized guide – with a disclaimer that this is just not legal advice – in case your concern pertains to employees’ health information, HIPAA might apply.
That features scenarios like:
- Recent employees providing health information to HR
- Arranging medical insurance for workers
- Responding to a health provider enquiring about an worker’s treatment eligibility
- Handling or storing workplace compensation claim data
Whether full or partial compliance applies relies on the precise scenario.
In the event you’re concerned that your organization’s practices or processes may be on the unsuitable side of HIPAA compliance, we recommend in search of legal advice.
It’s also necessary to do not forget that HIPAA isn’t the one privacy laws in play. Other laws like GDPR, CPPA and the Fair Credit Reporting Act govern what employers can do with certain worker data.
HIPAA non-compliance risks and penalties
Non-compliance with HIPAA can result in severe consequences. These include hefty fines, legal actions and reputational damage.
Financial penalties
The Department of Health and Human Services (HHS) can impose significant fines for HIPAA violations.
Penalties are tiered based on the extent of negligence, with fines starting from $100 to $50,000 per violation, per yr, with a maximum annual penalty of $1.5 million.
Popularity damage
Data breaches and other HIPAA violations can severely damage your organization’s status, causing affected individuals and prospective partners to lose trust.
Legal liabilities
Non-compliance can expose your organization to lawsuits from affected individuals and repair providers.
These lawsuits can drag on for months or years, draining financial reserves and limiting business activity.
Operational disruptions
Investigations and corrective actions required for non-compliance can disrupt every day operations and impact productivity.
Depending on your small business, these disruptions could affect patients’ access to essential healthcare services.
Lack of business
In severe cases, non-compliance can result in patients in search of care elsewhere and partners turning their backs.
These costs are hard to count and harder to recoup.
HIPAA compliance checklist: Best practices for HIPAA compliance in a changing world
Achieving and maintaining HIPAA compliance requires a proactive and comprehensive approach. That’s very true nowadays, with cybercrime on the rise and AI tools with questionable compliance appearing all over the place.
That’s why a comprehensive compliance strategy is crucial for businesses today.
You may carry on top of HIPAA compliance with these 13 focus areas.
1. Risk assessments
Conduct an intensive risk assessment to discover vulnerabilities in your organization’s systems and processes. Assess the likelihood and impact of PHI risks and implement mitigation strategies.
2. Access controls
Restrict access to PHI on a need-to-know basis. Implement strong password policies, including multi-factor authentication, and often review access permissions.
3. Data encryption
Encrypt PHI each at rest and in transit to guard it from unauthorized access. Use strong encryption standards and be certain that encryption keys are securely managed.
4. Worker training and awareness
Regular training on HIPAA regulations, policies, and procedures is crucial. Employees should understand the importance of protecting PHI and the implications of HIPAA non-compliance.
Training should cover the organization’s policies and procedures, common threats arising from on a regular basis activities, and best practices for data security.
5. Patient communication
Provide patients with a transparent and comprehensible notice of how their PHI might be used and disclosed.
6. Business associate agreements
Ensure all business associates handling PHI have signed HIPAA-compliant agreements and use HIPAA-compliant systems.
7. Incident response plans
Develop a comprehensive plan to reply to data breaches or other security incidents. Often review and update these policies to reflect changes in regulations and technology.
8. Security audits and penetration testing
Conduct regular security audits and penetration testing to discover and address security weaknesses. These activities must be conducted by qualified professionals.
9. Secure communication channels
Be certain that all communications involving PHI are conducted through secure, HIPAA-compliant channels. Avoid using unsecured email or messaging services. Persist with encrypted email services or secure file transfer protocols.
10.Physical security
Physical security measures are only as necessary as digital ones. Protect physical access to PHI by implementing measures resembling locked doors, surveillance cameras, and secure storage.
11. Updating software and systems
Often update all software and systems to guard against known vulnerabilities. Implement patch management processes to make sure security updates are timely and non-disruptive.
12. Mobile device security
Establish policies for using mobile devices to access PHI, including data encryption and distant wipe capabilities.
13. Data backup and recovery
Often back up PHI and ensure backups are secure. Develop and test recovery plans to make sure quick restoration in case of information loss or breach.
HIPAA compliance case study: Change healthcare
Change Healthcare is one among the world’s largest health clearinghouses, handling 15 billion medical claims annually. Most major US hospitals use its payment platform to process patient claims.
Even though it’s not a healthcare provider, it falls under HIPAA compliance. So, when hackers locked up the system in February 2024 and stole around 4 terabytes of PHI, it kicked off the most important HIPAA compliance case in history.
The hacker group used compromised credentials to access a portal that ought to have been protected by multi-factor authentication. They subsequently demanded a $22 million ransom for the information’s protected return.
Investigations are still ongoing. Nonetheless, current estimates are that one in three Americans could possibly be affected. That’s greater than 100 million people whose PHI could possibly be compromised, including:
- Medical health insurance information
- Medical records
- Billing, claims and payment information
- Personal data like Social Security numbers or ID numbers
Doctors’ offices and hospitals couldn’t process claims for several weeks, making a serious backlog and threatening patients’ access to care.
Although the complete impact of the breach is yet to be counted, the prices are already eye-watering.
- The American Hospital Association reported that 94% of hospitals recorded damage to money flow.
- UnitedHealth has already paid over $2 billion to cope with the ransomware attack response.
- Moreover, they provided $9 billion in advanced funding and interest-free loans to assist providers who couldn’t bill for services through Change Healthcare.
Adding to the mounting challenges, UnitedHealth missed the deadline to report the incident under the Breach Notification Rule by several months. The character of their business also means some healthcare organization customers could have turn out to be wrapped up within the breach, triggering additional notifications.
Change Healthare’s hackers were organized, militant and expert. Still, it needs to be said that the most important HIPAA compliance case in US history – one among the most important cyberattacks on record – was allegedly brought on by lax security in a legacy system. Change Healthcare continued to suffer crippling losses because a system they acquired in 2016 didn’t have multi-factor authentication.
The continuing and widespread fallout shows how critical HIPAA compliance is for organizations of all sizes.
Sources:
The role of workforce analytics in HIPAA compliance
For a similar reason as we’re concerned with GDPR, Soc 2 and other compliance frameworks: we care about compliance, accountability and security.
Monitoring anomalies
Workforce analytics tools may help discover unusual activity patterns which may indicate potential security breaches or compliance issues.
For instance, our Unusual Activity Report (UAR) flags suspicious keyboard and mouse behavior that might indicate non-compliant employees.
Detailed activity reporting, resembling Website & App Usage reports, may assist you pinpoint compliance issues like unauthorized software, non-compliant data transfers or suspicious usage patterns.
Analyzing worker behavior
Automatic time-tracking can assist you spot unauthorized attempts to access physical or virtual machines.
You may as well drill down on data mishandling incidents or discover processes that expose your organization to HIPAA compliance risks, resembling sharing sensitive data with other teams or transferring it to unsecured storage locations.
Fostering accountability
In our experience, most HIPAA compliance issues brought on by employees arise from a lack of understanding or training.
That is where workforce analytics really helps. You and your managers can proactively address training requirements or repeated incidents, getting ahead of compliance risks.
