HHS collects first settlement over smaller breach

The Hospice of North Idaho (HONI) has agreed to pay the U.S. Department of Health and Human Services (HHS) $50,000 to settle potential violations of the HIPAA Security Rule. This is the first settlement involving a breach of unprotected electronic protected health information (ePHI) affecting fewer than 500 individuals.

The HHS' Office for Civil Rights (OCR) began its investigation after HONI reported to HHS that an unencrypted laptop computer containing the ePHI of 441 patients had been stolen in June 2010. Laptops containing ePHI are regularly used by the organization as part of their field work. Over the course of the investigation, the OCR discovered that HONI had not conducted a risk analysis to safeguard ePHI. Further, HONI did not have in place policies or procedures to address mobile device security as required by the HIPAA Security Rule. Since the June 2010 theft, HONI has taken extensive additional steps to improve their HIPAA privacy and security compliance program.

“This action sends a strong message to the healthcare industry that, regardless of size, covered entities must take action and will be held accountable for safeguarding their patients’ health information,” said OCR's Director Leon Rodriguez. “Encryption is an easy method for making lost information unusable, unreadable and undecipherable.”

The HITECH Breach Notification Rule requires covered entities to report impermissible use or disclosure of protected health information, or “breach,” of 500 individuals or more to the HHS secretary and the media within 60 days after the discovery of the breach. Smaller breaches affecting less than 500 individuals must be reported to the HHS secretary on an annual basis. 

The resolution agreement can be found on the OCR website.