HIPAA's New Breach Rules

Law firm Proskauer has published a client alert that “HHS Issues HIPAA/HITECH Omnibus Final Rule Ushering in Significant Changes to Existing Regulations.” Most interesting to me was the breach notice section:

Section 13402 of the HITECH Act requires covered entities to
provide notification to affected individuals and to the Secretary of
HHS following the discovery of a breach of unsecured protected
health information. HITECH requires the Secretary to post on an
HHS Web site a list of covered entities that experience breaches of
unsecured protected health information involving more than 500
individuals. The Omnibus Rule substantially alters the definition of
breach. Under the August 24, 2009 interim final breach notification
rule, breach was defined as the “acquisition, access, use, or
disclosure of protected health information in a manner not permitted
under [the Privacy Rule] which compromises the security or privacy
of the protected health information.” The phrase “compromises the
security or privacy of [PHI]” was defined as “pos[ing] a significant risk
of financial, reputational, or other harm to the individual.”

According to HHS, “some persons may have interpreted the risk of
harm standard in the interim final rule as setting a much higher
threshold for breach notification than we intended to set. As a result
we have clarified our position that breach notification is necessary in
all situations except those in which the covered entity or business
associate, as applicable, demonstrates that there is a low probability
that the protected health information has been compromised. . . .”

The client alert goes on to lay out the four risk factors that must be considered.

I’m glad to see this. The prior approach has been a full employment act for lawyers, and a way for organizations to weasel out of their ethical and legal obligations. We are likely to see more regulatory updates of this form, despite intensive lobbying.

If organizations want a different risk threshold, it’s up to them to propose one that’s credible to regulators and the public.