FMCNA to Pay $3.5 Million for Non-Compliance with HIPAA’s Risk Analysis and Risk Management Rules

Fresenius Medical Care North America (FMCNA) has agreed to pay $3.5 million to the U.S. Department of Health and Human Services (HHS) Office for Civil Rights (OCR), and to adopt a comprehensive corrective action plan, in order to settle potential violations of the Health Insurance Portability and Accountability Act (HIPAA) Privacy and Security Rules. FMCNA is a provider of products and services for people with chronic kidney failure with over 60,000 employees that serves over 170,000 patients. FMCNA’s network is comprised of dialysis facilities, outpatient cardiac and vascular labs, and urgent care centers, as well as hospitalist and post-acute providers.

Read the full article on HHS’ website and pay careful attention to the 6 specific issues the OCR’s investigation identified as a basis for the fine:

  1. Failed to conduct an adequate risk analysis.
  2. Provided unauthorized access for a purpose not permitted by the Privacy Rule.
  3. Failed to implement policies and procedures to address security incidents.
  4. Failed to implement policies and procedures for devices containing ePHI inside and outside of the facility.
  5. Failed to implement policies and procedures to safeguard their facilities and equipment therein from unauthorized access, tampering, and theft.
  6. Failed to encrypt ePHI in appropriate circumstances.

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Shawn Tuma (@shawnetuma) is an attorney with an internationally recognized reputation in cybersecurity, computer fraud, and data privacy law. He is a Cybersecurity & Data Privacy Attorney at Scheef & Stone, LLP, a full-service commercial law firm in Texas that represents businesses of all sizes throughout the United States and, through its Mackrell International network, around the world.

Allscripts EHR Ransomware Attack is Huge–How Will it Impact Healthcare Practices?

OCR LogoSee recommendations below

On January 19, 2018, cybercriminals were successful in a ransomware attack on Allscripts, an electronic healthcare record (EHR) provider for healthcare providers across the United States. The attack encrypted some of Allscripts systems and prevented those healthcare providers who use those systems for their EHRs from being able to access their patient records. Not only is there the obvious impact this has had on those healthcare providers’ ability to treat their patients, but also, under HIPAA, the Office of Civil Rights presumes that all cyber-related security incidents where protected health information was accessed, acquired, used, or disclosed are reportable breaches unless certain criteria are satisfied. (See checklist in this post and this post for further explanation).

TMLT LogoThe Texas Medical Liability Trust (TMLT)’s blog post, Allscripts EHRS Falls Victim to Ransomware Attacks, goes into much greater detail in describing the facts of this event and what has taken place since the initial attack. The blog also provides an excellent analysis of the Business Associates considerations in a situation such as this and the post features several important recommendations for what practices need to do now from my friend and excellent cybersecurity and data privacy attorney Adrian Senyszyn (LinkedIn) and myself. So, what are you waiting for, go read the TMLT post … and hope and pray that you planned ahead and have cyber insurance!

See Also:

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Shawn Tuma (@shawnetuma) is an attorney with an internationally recognized reputation in cybersecurity, computer fraud, and data privacy law. He is a Cybersecurity & Data Privacy Attorney at Scheef & Stone, LLP, a full-service commercial law firm in Texas that represents businesses of all sizes throughout the United States and, through its Mackrell International network, around the world.

OCR Issues Cyberattack Response Checklist and Infographic

The United States Department of Health and Human Services’ Office for Civil Rights has just issued a checklist and infographic to aid healthcare organizations and their vendors in quickly responding to cyberattacks in compliance with HIPAA requirements.

Are Smaller Healthcare Practices Required to Report a Ransomware or Potential Data Breach?

Does the HIPAA Breach Notification Rule apply to all Covered Entities and Business Associates, Even Smaller Ones?

To many of you reading this post this question seems ridiculous. You know the answer. However, I get asked this question so frequently that I decided to answer it with a blog post to save time next time I get asked the same question. What is worse, however, is I often hear people say — out of complete ignorance — “no, it is not a big deal.”

Let me be clear: it is a big deal – a very big deal – and if it is considered a “breach” then you are required to report. See this Guide for more information.

Healthcare professionals must understand just how important cybersecurity and privacy of patient protected health information (PHI) is to their practices: You can spend your entire career building a fine medical practice and lose it all because you did not take this seriously. Don’t believe me? Then jump to this point of the post.

Are ransomware attacks a data breach?

Regarding ransomware attacks in particular, the Department of Health and Human Services (HHS) considers these kinds of attacks on Covered Entities and Business Associates to be a breach that requires notification, by default, unless you perform a risk assessment that considers four factors and determines there was no breach. See HHS FACT SHEET: Ransomware and HIPAA

The reason for this is because under what is called the CIA Triad of Cybersecurity. To maintain the security of data, you must ensure you maintain its confidentiality, integrity, and availability; when you have a ransomware attack encrypt your data, you no longer have availability unless you have appropriate backups of the data. Moreover, depending on the nature of the ransomware, some strains may exfiltrate data prior to the encryption, causing a failure to maintain confidentiality as well.

Is there a penalty for failing to notify?

 See also Professor Daniel Solove’s 2017 HIPAA Enforcement Update

Absolutely. When a Covered Entity or Business Associate fails to comply with the HIPAA Breach Notification Rule, HHS may launch an investigation and bring an enforcement action against the entity that failed to timely notify. Below are two notable cases where HHS has done this but it is important to note that the vast majority of the smaller ones are resolved with fines and compliance measures imposed at the investigation level:

Does HHS fine small healthcare practices?

Read these examples and decide for yourself:

If you would like more information about other HHS cases, read about these HHS Case Examples.

See: YES, YOU CAN BE HELD PERSONALLY LIABLE FOR YOUR COMPANY’S DATA BREACH – HERE’S WHY

What are the 3 most important questions you should ask yourself now before you have an incident?

  1. Do you have privacy and cyber insurance coverage for your practice?
  2. Do you always have a backup of your critical business, customer, and PHI information that is completely disconnected from your network?
  3. Do you understand these 3 critical cybersecurity steps your organization must take?

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Shawn Tuma (@shawnetuma) is a business lawyer with an internationally recognized reputation in cybersecurity, computer fraud, and data privacy law. He is a Cybersecurity & Data Privacy Partner at Scheef & Stone, LLP, a full-service commercial law firm in Texas that represents businesses of all sizes throughout the United States and, through its Mackrell International network, around the world.

Why is Healthcare Data So Valuable to Cyber Criminals?

Healthcare data is one of the most desirable forms of data for cyber criminals to steal because its value on the cyber black market — the Dark Web — is much higher than most other forms of data. While there are several reasons for this, the recent study Your Life, Repackaged and Resold: The Deep Web Exploitation of Health Sector Breach Victims, concluded Continue reading “Why is Healthcare Data So Valuable to Cyber Criminals?”