ALJ Upholds Civil Monetary Penalty Imposed by the Office for Civil Rights

On February 3, the U.S. Department of Health and Human Services (HHS) Office for Civil Rights (OCR) announced that an HHS administrative law judge (ALJ) ordered Lincare, Inc., a home health provider of respiratory care, infusion therapy and medical equipment, to pay $239,800 in civil monetary penalties (CMPs) for violating the Health Insurance Portability and Accountability Act of 1996 (HIPAA) Privacy Rule. The violations were disclosing patient information to an unauthorized person, failing to take reasonable safeguards to protect patient information from unauthorized disclosure and failing to implement adequate policies and procedures to protect patient information removed from its offices. This marks only the second time that OCR has imposed CMPs for HIPAA violations.

OCR began investigating Lincare after a Lincare employee’s husband complained that his wife left behind documents containing the protected health information (PHI) of 278 patients after she moved out of their home in November 2008. The ALJ found that the evidence established that the employee removed patients’ information from the company’s office, left the information exposed in places where an unauthorized person had access and then abandoned the information.

The breached documents included an emergency procedures manual, which had names, addresses, telephone numbers and emergency contacts for 270 patients and patient-specific documents (e.g., assessments, care plans, prescriptions, certificates of necessities and order confirmations) that included names, addresses, phone numbers, birth dates, diagnoses, symptoms, test results, prescriptions and physician and pharmacy names for eight patients.

During the course of its investigation, OCR found that Lincare employees who provided healthcare services in patients’ homes regularly removed materials containing PHI from the business premises. Lincare also had an unwritten policy requiring certain employees to store PHI in their own vehicles for extended periods of time.

Despite being aware of the complaint and OCR’s investigation, Lincare allegedly did not take sufficient actions to correct its policies and strengthen its safeguards for PHI taken offsite. While Lincare revised its policies in 2009, it failed to specify how employees should remove documents containing PHI from secured storage areas, which the ALJ said left the policies “virtually unchanged.” This led the ALJ to find that “Lincare management did not seem to recognize any problem and did not seriously consider amending its policies to safeguard PHI removed from the office.”

OCR Director Jocelyn Samuels explained that “[w]hile OCR prefers to resolve issues through voluntary compliance, this case shows that [OCR] will take the steps necessary, including litigation, to obtain adequate remedies for violations of the HIPAA Rules.” Samuels warned that “[u]nder the ALJ’s ruling, all covered entities, including home health providers, must ensure that if their workforce members take protected health information offsite, they have adequate policies and procedures that provide for the reasonable and appropriate safeguarding of that PHI, whether in paper or electronic form.”

For additional information, please see OCR’s Notice of Proposed Determination and the ALJ’s full opinion.