Memorial Healthcare Systems Agrees to $5.5 Million HIPAA Settlement | Healthcare Informatics Magazine | Health IT | Information Technology Skip to content Skip to navigation

Memorial Healthcare Systems Agrees to $5.5 Million HIPAA Settlement

February 16, 2017
by Heather Landi
| Reprints

Hollywood, Fla.-based Memorial Healthcare Systems (MHS) agreed to pay the U.S. Department of Health and Human Services (HHS) $5.5 million to settle potential violations of the Health Insurance Portability and Accountability Act of 1996 (HIPAA) Privacy and Security Rules, according to HHS.

MHS operates six hospitals, an urgent care center, a nursing home, and a variety of ancillary health care facilities throughout the South Florida area. MHS is also affiliated with physician offices through an Organized Health Care Arrangement (OHCA).

In a statement regarding the HHS Office for Civil Rights settlement, Kerting Baldwin, administrative director, corporate communciations at Memorial Healthcare System, said, "It’s important to put this settlement in perspective to the fact that this situation happened six years ago, and that Memorial Healthcare System proactively reported the actions of the two employees and the findings of its internal investigation regarding the affiliated physicians’ staff to the Department of Health and Human Services’ Office of Civil Rights (OCR). It also simultaneously notified all patients who may have been affected and provided them with free credit-monitoring. Memorial worked closely with law enforcement to assist in their investigations, which ultimately led to federal prosecution and conviction of the criminals."

According to OCR, back in April 2012, MHS submitted a breach report to HHS indicating that two health system employees inappropriately accessed patient information, including names, dates of birth, and social security numbers. MHS reported to OCR that the protected health information (PHI) of 115,143 individuals had been impermissibly accessed by its employees and impermissibly disclosed to affiliated physician office staff. This information consisted of the affected individuals’ names, dates of birth, and social security numbers.

Further, according to OCR, the login credentials of a former employee of an affiliated physician’s office had been used to access the ePHI maintained by MHS on a daily basis without detection from April 2011 to April 2012, affecting 80,000 individuals. “Although it had workforce access policies and procedures in place, MHS failed to implement procedures with respect to reviewing, modifying and/or terminating users’ right of access, as required by the HIPAA Rules,” OCR officials stated in a press release. “Further, MHS failed to regularly review records of information system activity on applications that maintain electronic protected health information by workforce users and users at affiliated physician practices, despite having identified this risk on several risk analyses conducted by MHS from 2007 to 2012.”

Baldwin also stated that upon learning of the breaches, Memorial quickly acted to implement new, sophisticated technologies designed to monitor use and access of patient data, further restricted access to protect patient information, and enacted new policies and procedures to enhance password security. "Memorial hired IBM, a global leader in cybersecurity, to provide assessment, response, and monitoring services. IBM continues to provide cybersecurity services to Memorial today. Memorial also hired an independent technology firm to conduct network audits and scans," he said in a statement.

Further, Baldwin said Memorial’s February 2017 settlement with the OCR resolves all allegations surrounding these breaches. "While Memorial strongly disagrees with many of OCR’s allegations, has admitted no liability and has chosen to settle this case, it nevertheless agrees with the importance OCR places on maintaining the security of patient information."

"Safeguarding patients’ health information has always been a top priority at Memorial Healthcare System. We will continue to vigorously monitor access and use of patient information and maintain rigorous cybersecurity and internal safeguards,"  Baldwin said in the statement.

As part of the settlement and according to the resolution agreement, MHS also agreed to implement a robust corrective action plan, OCR officials stated.

According to Robinsue Frohboese, HHS OCR Acting Director this recent settlement highlights the importance of audit controls.

“Access to ePHI must be provided only to authorized users, including affiliated physician office staff. Further, organizations must implement audit controls and review audit logs regularly. As this case shows, a lack of access controls and regular review of audit logs helps hackers or malevolent insiders to cover their electronic tracks, making it difficult for covered entities and business associates to not only recover from breaches, but to prevent them before they happen,” Frohboese said.

 

Get the latest information on Health IT and attend other valuable sessions at this two-day Summit providing healthcare leaders with educational content, insightful debate and dialogue on the future of healthcare and technology.

Learn More

Topics

News

ONC Roundup: Senior Leadership Changes Spark Questions

The Office of the National Coordinator for Health IT (ONC) has continued to experience changes within its upper leadership, leading some folks to again ponder what the health IT agency’s role will be moving forward.

Media Report: Walmart Hires Former Humana Executive to Run Health Unit

Reigniting speculation that Walmart and insurer Humana are exploring ways to forge a closer partnership, Walmart Inc. has hired a Humana veteran to run its health care business, according to a report from Bloomberg.

Value-Based Care Shift Has Halted, Study Finds

A new study of 451 physicians and health plan executives suggests that progress toward value-based care has stalled. In fact, it may have even taken a step backward over the past year, the research revealed.

Study: EHRs Tied with Lower Hospital Mortality, But Only After Systems Have Matured

Over the past decade, there has been significant national investment in electronic health record (EHR) systems at U.S. hospitals, which was expected to result in improved quality and efficiency of care. However, evidence linking EHR adoption to better care is mixed, according to medical researchers.

Nursing Notes Can Help Predict ICU Survival, Study Finds

Researchers at the University of Waterloo in Ontario have found that sentiments in healthcare providers’ nursing notes can be good indicators of whether intensive care unit (ICU) patients will survive.

Health Catalyst Completes Acquisition of HIE Technology Company Medicity

Salt Lake City-based Health Catalyst, a data analytics company, has completed its acquisition of Medicity, a developer of health information exchange (HIE) technology, and the deal adds data exchange capabilities to Health Catalyst’s data, analytics and decision support solutions.