Catholic Health Care Services to Pay $650,000 Fine for Data Breach

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Catholic Health Care Services of the Archdiocese of Philadelphia (CHCS) has agreed to pay the Department of Health and Human Services Office of Civil Rights $650,000 to settle violations of the Health Insurance Portability and Accountability Act of 1996 (HIPAA) Security Rule. This after a CHCS-issued iPhone was stolen and potentially compromised the protected health information (PHI) of hundreds of nursing home residents. CHCS provided management and information technology services as a business associate to six skilled nursing facilities. The total number of individuals affected by the combined breaches was 412. The settlement includes the monetary payment as well as a corrective action plan.

“Business associates must implement the protections of the HIPAA Security Rule for the electronic protected health information they create, receive, maintain, or transmit from covered entities,” said Jocelyn Samuels, director of the HHS Office for Civil Rights. “This includes an enterprise-wide risk analysis and corresponding risk management plan, which are the cornerstones of the HIPAA Security Rule.”

OCR began its investigation on April 17, 2014, after receiving notification that CHCS had experienced a breach of PHI involving the theft of a CHCS-issued employee iPhone. The iPhone was unencrypted and was not password protected. The information on the iPhone was extensive, and included social security numbers, information regarding diagnosis and treatment, medical procedures, names of family members and legal guardians, and medication information. At the time of the incident, CHCS had no policies addressing the removal of mobile devices containing PHI from its facility or what to do in the event of a security incident; OCR also determined that CHCS had no risk analysis or risk management plan.

In determining the resolution amount, OCR said it considered that CHCS provides unique and much-needed services in the Philadelphia region to the elderly, developmentally disabled individuals, young adults aging out of foster care, and individuals living with HIV/AIDS. OCR will monitor CHCS for two years as part of this settlement agreement, helping ensure that CHCS will remain compliant with its HIPAA obligations while it continues to act as a Business Associate.

Read the Resolution Agreement and Corrective Action Plan.

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