What are the Penalties for Violating HIPAA Laws?

The healthcare industry has evolved tremendously over recent decades. Patient privacy has become increasingly important, as has patients’ rights. As a patient or healthcare professional, you’ve probably heard of HIPAA. But what exactly is HIPAA and what are the penalties for violating HIPAA laws? We’re taking an in-depth look at HIPAA as a whole and what happens when these laws are violated.

What is HIPAA?

HIPAA, sometimes erroneously referred to as HIPPA, is an acronym for the Health Insurance Portability and Accountability Act, passed by Congress in 1996. According to California’s Department of Health Care Services, HIPPA does a variety of things and is separated into several different “titles.” Here are some of the things HIPAA does:

  • It allows for the transfer and continuation of health insurance coverage for workers and their families if someone changes or loses their employment.
  • It tremendously reduces the risk of healthcare abuse and fraud.
  • It federally mandates standards for healthcare information, privacy, electronic billing, and many other processes.
  • It mandates the requirement of protection and confidentiality when handling protected health information. This simply means that HIPAA requires all professionals, organizations, and providers create and follow procedures that “ensure the confidentiality and security of protected health information when it is transferred, received, handled, or shared.”

How does one Violate HIPAA Laws and what are the Penalties?

HIPPA’s laws were created to protect patients. When you don’t take care with patients’ privacy, you could be at risk for penalties for violating HIPAA. The Department of Health and Human Services’ Office for Civil Rights (OCR) is the power that investigates and enforces each and every HIPAA law. They are also the force that issues penalties to those that fail to comply with these laws.

The financial penalties that are issued by the OCR are meant to act as a deterrent, but also ensure that all organizations bound by HIPAA are held accountable for their actions. Penalties are issues when violations are made in regards to protecting the privacy of patients and confidentiality of health data. The structure created for penalties is tiered, based mainly on the knowledge the organization in question had of the violation at hand. The OCR sets penalties based on some general factors, the seriousness of the violation, and in some cases, the willful neglect of rules.

According to the American Medical Association, civil violations are tiered as such:

  • Unknowing- this means that HIPAA rules were unknowingly violated and could not have been avoided. The minimum penalty for this tier is $100/violation, with an annual maximum of $25,000/repeat violations. The maximum penalty is $50,000/violation.
  • Reasonable cause- this means that the organization in question should have been aware of the violation, but could not have avoided it. The minimum penalty for this violation is $1,000/violation, with an annual maximum of $100,000/repeat violations. The maximum penalty is $50,000/violation.
  • Willful neglect (violation is corrected within the time period required)- this means that a violation has occurred as a direct result of neglect, but the organization is making attempts to correct it. The minimum penalty is $10,000/violation, with an annual maximum of $250,000/repeat violations. The maximum penalty is $50,000/violation.
  • Willful neglect (violation is not corrected within the time period required)- this means that a violation has occurred as a direct result of neglect , but the organization makes no attempt to correct it. The minimum penalty is $50,000/violation, with an annual maximum of $250,000/repeat violations. The maximum penalty is $50,000/violation.

The privacy and rights of patients is an extremely important part of the healthcare industry. It is even more important that every organization do whatever is necessary to follow HIPAA laws and regulations, or they are subject to heavy penalties.

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