Direct Liability of Business Associates
Direct Liability of Business Associates In 2009, Congress enacted the Health Information Technology for Economic and Clinical Health (HITECH) Act, making business associates of covered entities directly liable for compliance with certain requirements of the HIPAA Rules. Consistent with the HITECH Act, the HHS Office for Civil Rights (OCR) issued a final rule in 2013 to modify the HIPAA Privacy, Security, Breach Notification, and Enforcement Rules. Among other things, the final rule identifies provisions of the HIPAA Rules that apply directly to business associates and for which business associates are directly liable. As set forth in the HITECH Act and OCR’s 2013 final rule, OCR has authority to take enforcement action against business associates only for those requirements and prohibitions of the HIPAA Rules as set forth below. Business associates are directly liable for HIPAA violations as follows: - Failure to provide the Secretary with records and compliance reports; cooperate with complaint investigations and compliance reviews; and permit access by the Secretary to information, including protected health information (PHI), pertinent to determining compliance.
- Taking any retaliatory action against any individual or other person for filing a HIPAA complaint, participating in an investigation or other enforcement process, or opposing an act or practice that is unlawful under the HIPAA Rules.
- Failure to comply with the requirements of the Security Rule.
- Failure to provide breach notification to a covered entity or another business associate.
- Impermissible uses and disclosures of PHI.
- Failure to disclose a copy of electronic PHI (ePHI) to either (a) the covered entity or (b) the individual or the individual’s designee (whichever is specified in the business associate agreement) to satisfy a covered entity's obligations under 45 CFR 164.524(c)(2)(ii) and 3(ii), respectively, with respect to an individual’s request for an electronic copy of PHI.
- Failure to make reasonable efforts to limit PHI to the minimum necessary to accomplish the intended purpose of the use, disclosure, or request.
- Failure, in certain circumstances, to provide an accounting of disclosures.
- Failure to enter into business associate agreements with subcontractors that create or receive PHI on their behalf, and failure to comply with the implementation specifications for such agreements.
- Failure to take reasonable steps to address a material breach or violation of the subcontractor’s business associate agreement.
For example, where the business associate’s agreement with a covered entity requires it to provide an individual with an electronic copy of his or her ePHI upon the individual’s request and the business associate fails to do so, OCR has enforcement authority directly over the business associate for that failure. (See No. 6 above.) By contrast, OCR lacks the authority to enforce the “reasonable, cost-based fee” limitation in 45 CFR 164.524(c)(4) against business associates because the HITECH Act does not apply the fee limitation provision to business associates. A covered entity that engages the services of a business associate to fulfill an individual’s request for access to their PHI is responsible for ensuring that, where applicable, no more than the reasonable, cost-based fee permitted under HIPAA is charged. If the fee charged is in excess of the fee limitation, OCR can take enforcement action against only the covered entity.
| May a covered entity dispose of protected health information in dumpsters accessible by the public? For example, depending on the circumstances, proper disposal methods may include (but are not limited to): Shredding or otherwise destroying PHI in paper records so that the PHI is rendered essentially unreadable, indecipherable, and otherwise cannot be reconstructed prior to it being placed in a dumpster or other trash receptacle.Maintaining PHI for disposal in a secure area and using a disposal vendor as a business associate to pick up and shred or otherwise destroy the PHI.In justifiable cases, based on the size and the ...read more |
| DOVER (Oct. 21, 2022) – The Delaware Division of Developmental Disabilities Services is announcing today that it is mailing letters to service recipients and legal guardians who were impacted by a recent data breach incident and is providing information to the public regarding the incident. On August 23, 2022, staff within the Division of Developmental Disabilities Services (DDDS) discovered that in the process of creating new user accounts in the division’s client database, DDDS staff inadvertently provided access to individual records of 7074 individuals. As a result of these actions, 159 new users had potential access to service recipients’ ...read more |
| What is a covered entity’s obligation under the Breach Notification Rule if it transmits an individual’s PHI to a third party designated by the individual in an access request, and the entity discovers the information was breached in transit? This guidance remains in effect only to the extent that it is consistent with the court’s order in Ciox Health, LLC v. Azar, No. 18-cv-0040 (D.D.C. January 23, 2020), which may be found at https://ecf.dcd.uscourts.gov/cgi-bin/show_public_doc?2018cv0040-51. More information about the order is available at https://www.hhs.gov/hipaa/court-order-right-of-access/index.html. Any provision within this guidance that has been vacated by the Ciox Health decision is rescinded. ...read more |
| May a covered entity use or disclose protected health information for litigation? Answer: A covered entity may use or disclose protected health information as permitted or required by the Privacy Rule, see 45 CFR 164.502(a) (PDF); and, subject to certain conditions the Rule typically permits uses and disclosures for litigation, whether for judicial or administrative proceedings, under particular provisions for judicial and administrative proceedings set forth at 45 CFR 164.512(e) (GPO), or as part of the covered entity’s health care operations, 45 CFR 164.506(a) (PDF). Depending on the context, a covered entity’s use or disclosure of protected health information in ...read more |
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1/21/25 Understanding Business Associate Agreements
11/12/22 Modernizing Medicine Agrees to Pay $45 Million to Resolve Allegations of Accepting and Paying Illegal Kickbacks and Causing False Claims
11/12/22 Indian National Charged in $8 Million COVID-19 Relief Fraud Scheme
11/12/22 Former Hospital Employee Pleads Guilty To Criminal HIPPA Charges
11/12/22 Covered entities and those persons rendered accountable by general principles of corporate criminal liability may be prosecuted directly under 42 U.S.C. § 1320d-6
11/12/22 The Delaware Division of Developmental Disabilities Services Data Breach
11/12/22 OCR Settles Three Cases with Dental Practices for Patient Right of Access under HIPAA
11/12/22 HHS Issues Guidance on HIPAA and Audio-Only Telehealth
11/12/22 Five Former Methodist Hospital Employees Charged with HIPAA Violations
11/12/22 May a covered entity use or disclose protected health information for litigation?
11/12/22 When does the Privacy Rule allow covered entities to disclose protected health information to law enforcement officials?
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