Businesses Must Prepare To Respond For Potential Data Breach To Timely Meet Notice & Other Response Duties

May 31, 2017

Source: Businesses Must Prepare To Respond For Potential Data Breach To Timely Meet Notice & Other Response Duties


SCOTUS Ruling Bars Many State Arbitration Agreement Restrictions

May 16, 2017

Monday’s U.S. Supreme Court ruling in Kindred Nursing Centers L.P. v. Clark boosts the ability of health care and other businesses and employers to enforce contractual agreements to arbitrate free from State law interference. Employers and businesses in jurisdictions where States imposing special requirements for the enforcement of arbitration agreements may want to consult with legal counsel about the implications of the decision on their ability to use and enforce arbitration agreements as well as on any ongoing litigation where the enforceability of arbitration agreements based on state law restrictions is an issue.

Monday’s U.S. Supreme Court ruling in Kindred Nursing Centers L.P. v. Clark boosts the ability of health care and other businesses and employers to enforce contractual agreements to arbitrate free from State law interference. Employers and businesses in jurisdictions where States imposing special requirements for the enforcement of arbitration agreements may want to consult with legal counsel about the implications of the decision on their ability to use and enforce arbitration agreements as well as on any ongoing litigation where the enforceability of arbitration agreements based on state law restrictions is an issue.  Likewise, most businesses will want to re-evaluate the effects of their agreement to arbitration agreements in past and future contracts.

In Kindred, the Supreme Court ruled the FAA blocks states from making arbitration agreements harder to enforce than other contracts.  While specifically addressing the effect of the FAA on a health care contract with a patient, the decision has implications upon a broad range of state law restrictions on the enforcement of arbitration agreements including agreements between businesses and their employees, customers, vendors, suppliers, and others.

The Kindred decision arose from Kindred’s appeal of a Kentucky Supreme Court ruling that blocked Kindred from enforcing a contractual agreement to use arbitration to resolve disputes in a nursing home admission contracts signed pursuant to power of attorneys because neither power of attorney specifically entitled the representative to enter into an arbitration agreement. The Kentucky Supreme Court imputed the requirement that the power of attorney specifically grant authority to agree to arbitration because the Kentucky Constitution declares the rights of access to the courts and trial by jury to be “sacred” and “inviolate.”

The U.S. Supreme Court in Kindred held that the Kentucky Supreme Court’s clear-statement rule violates the Federal Arbitration Act (FAA) by singling out arbitration agreements for disfavored treatment. Pp. 4–10.

The Supreme Court decision construed the FAA provision that arbitration agreements are “valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract,” 9 U. S. C. §2, as requiring equal treatment of arbitration provisions with other contractual provisions.  Under this equal treatment principle, the Supreme Court ruled a court may invalidate an arbitration agreement based on “generally applicable contract defenses,” but not on legal rules that “apply only to arbitration or that derive their meaning from the fact that an agreement to arbitrate is at issue.” Accordingly, the Supreme Court ruled that the FAA preempts any state rule that discriminates on its face against arbitration or that covertly accomplishes the same objective by disfavoring contracts that have the defining features of arbitration agreements.

Concluding that the Kentucky Supreme Court’s clear statement rule fails to put arbitration agreements on an equal plane with other contracts by requiring an explicit statement before an agent can relinquish her principal’s right to go to court and receive a jury trial, the Supreme Court found the Kentucky Supreme Court did exactly what the FAA barred: adopt a legal rule hinging on the primary characteristic of an arbitration agreement. Pp. 4–7. Accordingly the Supreme Court ordered the arbitration agreements enforced in Kindred.

Management Pointers & Action Items

The Supreme Court’s construction of the FAA as establishing an “equal protection” rule for arbitration provisions is likely to have implications beyond health care contracts to a broad range of other state laws and rules that purport to protect consumers, employees and others to contractually waive their litigation rights. While the Supreme Court ruling leaves open the ability to challenge arbitration clauses on contractual grounds generally applicable to all contracts, special State law rules for enforcing arbitration are not allowed.

Management should review their arbitration agreements and related dispute resolution agreements with qualified legal counsel for potential options to reduce risks and manage dispute resolution costs using arbitration agreements with employees, customers, service providers and others as well as to understand the implications of existing arbitration clause is on their exposures to others arising from contractual agreements to arbitrate previously thought to be subject to state law restrictions on enforceability.  Businesses and individuals considering entering in or enforcing arbitration agreements should keep in mind, however, that the Kindred ruling does not insulate arbitration agreements from State law defenses that apply equally to other non-arbitration contracts.

About The Author

Recognized by her peers as a Martindale-Hubble “AV-Preeminent” (Top 1%) and “Top Rated Lawyer” with special recognition LexisNexis® Martindale-Hubbell® as “LEGAL LEADER™ Texas Top Rated Lawyer” in Health Care Law and Labor and Employment Law; as among the “Best Lawyers In Dallas” for her work in the fields of “Labor & Employment,” “Tax: Erisa & Employee Benefits,” “Health Care” and “Business and Commercial Law” by D Magazine, Cynthia Marcotte Stamer is a practicing attorney board certified in labor and employment law by the Texas Board of Legal Specialization and management consultant, author, public policy advocate and lecturer widely known for work, teachings and publications.

Ms. Stamer works domestically and internationally with health, insurance and financial services, data and technology, services and consulting, energy, retail, hospitality and other businesses and their management, employee benefit plans, governments and other organizations deal with all aspects of human resources and workforce, internal controls and regulatory compliance, change management and other performance and operations management and compliance. Her day-to-day work encompasses both labor and employment issues, as well as independent contractor, outsourcing, employee leasing, management services and other nontraditional service relationships. She supports her clients both on a real-time, “on demand” basis and with longer term basis to deal with all aspects for workforce and human resources management, including, recruitment, hiring, firing, compensation and benefits, promotion, discipline, compliance, trade secret and confidentiality, noncompetition, privacy and data security, safety, daily performance and operations management, emerging crises, strategic planning, process improvement and change management, investigations, defending litigation, audits, investigations or other enforcement challenges, government affairs and public policy.

Well-known for her extensive work with health, insurance, financial services, technology, energy, manufacturing, retail, hospitality and governmental employers, her nearly 30 years’ of experience encompasses domestic and international businesses of all types and sizes.A Fellow in the American College of Employee Benefit Counsel, the American Bar Foundation and the Texas Bar Foundation, Ms. Stamer also shares her thought leadership, experience and advocacy on these and other concerns by her service in the leadership of a broad range of other professional and civic organization including her involvement as the Vice Chair of the North Texas Healthcare Compliance Association; Executive Director of the Coalition on Responsible Health Policy and its PROJECT COPE: Coalition on Patient Empowerment; former Board President of the early childhood development intervention agency, The Richardson Development Center for Children; former Gulf Coast TEGE Council Exempt Organization Coordinator; a founding Board Member and past President of the Alliance for Healthcare Excellence; former board member and Vice President of the Managed Care Association; past Board Member and Board Compliance Committee Chair for the National Kidney Foundation of North Texas; a member and advisor to the National Physicians’ Council for Healthcare Policy; current Vice Chair of the ABA Tort & Insurance Practice Section Employee Benefits Committee; current Vice Chair of Policy for the Life Sciences Committee of the ABA International Section; Past Chair of the ABA Health Law Section Managed Care & Insurance Section; a current Defined Contribution Plan Committee Co-Chair, former Group Chair and Co-Chair of the ABA RPTE Section Employee Benefits Group; immediate past RPTE Representative to ABA Joint Committee on Employee Benefits Council Representative and current RPTE Representative to the ABA Health Law Coordinating Council; past Chair of the Dallas Bar Association Employee Benefits & Executive Compensation Committee; a former member of the Board of Directors, Treasurer, Member and Continuing Education Chair of the Southwest Benefits Association and others.

Ms. Stamer also is a highly popular lecturer, symposia chair and author, who publishes and speaks extensively on human resources, labor and employment, employee benefits, compensation, occupational safety and health, and other regulatory and operational risk management. Examples of her many highly regarded publications on these matters include the “Texas Payday Law” Chapter of Texas Employment Law, as well as thousands of other publications, programs and workshops these and other concerns for the American Bar Association, ALI-ABA, American Health Lawyers, Society of Human Resources Professionals, the Southwest Benefits Association, the Society of Employee Benefits Administrators, the American Law Institute, Lexis-Nexis, Atlantic Information Services, The Bureau of National Affairs (BNA), InsuranceThoughtLeaders.com, Benefits Magazine, Employee Benefit News, Texas CEO Magazine, HealthLeaders, the HCCA, ISSA, HIMSS, Modern Healthcare, Managed Healthcare, Institute of Internal Auditors, Society of CPAs, Business Insurance, Employee Benefits News, World At Work, Benefits Magazine, the Wall Street Journal, the Dallas Morning News, the Dallas Business Journal, the Houston Business Journal, and many other symposia and publications. She also has served as an Editorial Advisory Board Member for human resources, employee benefit and other management focused publications of BNA, HR.com, Employee Benefit News, InsuranceThoughtLeadership.com and many other prominent publications and speaks and conducts training for a broad range of professional organizations and for clients on the Advisory Boards of InsuranceThoughtLeadership.com, HR.com, Employee Benefit News, and many other publications.

Want to know more? See here for details about the author of this update, attorney Cynthia Marcotte Stamer, e-mail her here or telephone Ms. Stamer at (469) 767-8872.

About Solutions Law Press, Inc.™

Solutions Law Press, Inc.™ provides human resources and employee benefit and other business risk management, legal compliance, management effectiveness and other coaching, tools and other resources, training and education on leadership, governance, human resources, employee benefits, data security and privacy, insurance, health care and other key compliance, risk management, internal controls and operational concerns. If you find this of interest, you also be interested reviewing some of our other Solutions Law Press, Inc.™ resources at www.SolutionsLawPress.com.

If you or someone else you know would like to receive future updates about developments on these and other concerns, please provide your current contact information and preferences including your preferred e-mail by creating or updating your profile here.

NOTICE: These statements and materials are for general informational and purposes only. They do not establish an attorney-client relationship, are not legal advice, and do not serve as a substitute for legal advice. Readers are urged to engage competent legal counsel for consultation and representation in light of the specific facts and circumstances presented in their unique circumstance at any particular time. No comment or statement in this publication is to be construed as an admission. The author reserves the right to qualify or retract any of these statements at any time. Likewise, the content is not tailored to any particular situation and does not necessarily address all relevant issues. Because the law is rapidly evolving and rapidly evolving rules makes it highly likely that subsequent developments could impact the currency and completeness of this discussion. The publisher and the author expressly disclaim all liability for this content and any responsibility to provide any update or otherwise notify anyone of any such change, limitation, or other condition that might affect the suitability of reliance upon these materials or information otherwise conveyed in connection with this program. Readers may not rely upon, are solely responsible for, and assume the risk and all liabilities resulting from their use of this publication.


Stamer To Moderate, Talk Medical CyberSecurity At 5/19 ISSA-LA IT Security Meedical Privacy Forum

May 12, 2017

Solutions Law Press, Inc. editor and attorney Cynthia Marcotte Stamer will speak and moderate two key panel programs on health care privacy and data security scheduled at the Healthcare Privacy & Security Form hosted on May 19, 2017 by the Information Security Systems Association of Los Angeles County (ISSA-LA) as a component of its 9th Annual ISSA-LA Information Security Summit. The presentations of Ms. Stamer and others at the conference are particularly timely coming on the heels of the May 12 Cyber alerts to U.S. health industry and other businesses about the urgent need to defend against the spread of an epidemic international malware threat targeting U.S. healthcare and other businesses.  See Urgent WannaCry Ransomware Cyber Warning IssuedAlert: Guard Health E-Mail, Other IT Against WannaCry Malware Attack.

The Medical Privacy & Security Summit is part of the 9th Annual ISSA-LA Information Security Summit scheduled for May 18-19, 2017 at the Universal City Hilton in Los Angeles.  Recognized as a premier information security education and networking event, the Summit is expected to bring together 1000 or more health industry and other IT and InfoSec executives, leaders, analysts, and practitioners to learn from the experts, exchange ideas with their peers, and enjoy conversations with the community.

The Healthcare Privacy & Security Forum offered for the 5th year as a component of the annual Summit on May 19 specifically focuses on leading challenges, issues and opportunities confronted by health industry privacy and security professionals and their organizations.  Ms. Stamer has served on the steering committee, moderator and popular faculty member for the 2017 Forum for the 5th consecutive year.  During the 2017 Forum, she will moderate and speak on two panels:

  • “Finding & Negotiating The Mine Fields: CISO, CIO & Privacy Officer’s Playbook for Promoting Compliance & Security Without Getting Fired,” a luncheon interactive panel discussion with the audience exploring the challenging mission CISOs, CIOs and Privacy Officers face to ensure their healthcare, financial and other critical information, data and systems continue to support the patient care and operating functions of their organizations, while at the same time defending these systems, operations and their sensitive, but mission critical data against malicious or innocent misappropriation, use, access or destruction; and
  • The closing panel on “What Initiatives Are on the Horizon in Healthcare, and How Can We Secure Them?”, which will explore likely future emerging privacy and security threats and technologies, regulatory challenges and enforcement, and other trends that Privacy and Security professionals are likely to face and tips and strategies for preparing to leverage these likely new opportunities and manage new challenges.

Register or get the full schedule of programs and other events scheduled at the Healthcare Privacy & Security Forum specifically along with the overall Information Security Summit here.

About Ms. Stamer

Cynthia Marcotte Stamer is a Martindale-Hubble “AV-Preeminent (Top 1%) rated practicing attorney and management consultant, health industry public policy advocate, widely published author and lecturer, recognized for her nearly 30 years’ of work on health industry and other privacy and data security and other health care, health benefit, health policy and regulatory affairs and other health industry legal and operational as a LexisNexis® Martindale-Hubbell® “LEGAL LEADER™ and “Top Rated Lawyer,” in Health Care Law and Labor and Employment Law; a D Magazine “Best Lawyers In Dallas” in the fields of “Health Care,” “Labor & Employment,” “Tax: Erisa & Employee Benefits” and “Business and Commercial Law,” a Fellow in the American Bar Foundation, the Texas Bar Foundation and the American College of Employee Benefit Counsel.

Scribe for ABA JCEB annual agency meeting with OCR for many years, Ms. Stamer is well-known for her extensive work and leadership throughout her career on HIPAA, FACTA, PCI, IRC and other tax, Social Security, GLB, trade secret, physician and other medical confidentiality and privacy, federal and state data security and data breach and other information privacy and data security rules and concerns.  Ms. Stamer has worked extensively throughout her career with health care providers, health plans, health care clearinghouses, their business associates, employers and other plan sponsors, banks, insurers and other financial institutions, and others on trade secret confidentiality, privacy, data security and other risk management and compliance including design, establishment, documentation, implementation, audit and enforcement of policies, procedures, systems and safeguards, drafting and negotiation of business associate, chain of custody, confidentiality, and other contracting; risk assessments, audits and other risk prevention and mitigation; investigation, reporting, mitigation and resolution of known or suspected breaches, violations or other incidents; and defending investigations or other actions by plaintiffs, OCR, FTC, state attorneys’ general and other federal or state agencies, other business partners, patients and others; reporting known or suspected violations; commenting or obtaining other clarification of guidance and other regulatory affairs, training and enforcement, and a host of other related concerns.

Her clients include public and private health care providers, health insurers, health plans, employers, payroll, staffing, recruitment, insurance and financial services, health and other technology and other vendors, and others.

Author of a multitude of highly-regarded works and training programs on HIPAA and other data security, privacy and use published by BNA, the ABA and other premier legal industry publishers In addition to representing and advising these organizations, she also speaks extensively and conducts training on health care and other privacy and data security and many other matters Privacy & The Pandemic for the Association of State & Territorial Health Plans, as well as HIPAA, FACTA, PCI, medical confidentiality, insurance confidentiality and other privacy and data security compliance and risk management for Los Angeles County Health Department, ISSA, HIMMS, the ABA, SHRM, schools, medical societies, government and private health care and health plan organizations, their business associates, trade associations and others.

Beyond these involvements, Ms. Stamer also is active in the leadership of a broad range of other professional and civic organizations. Through these and other involvements, she helps develop and build solutions, build consensus, garner funding and other resources, manage compliance and other operations, and take other actions to identify promote tangible improvements in health care and other policy and operational areas.

For additional information about Ms. Stamer, see here or contact Ms. Stamer directly by e-mail here or by telephone at (469) 767-8872. ©2017 Cynthia Marcotte Stamer.  Limited, non-exclusive right to republish granted to Solutions Law Press, Inc.  All other rights reserved.


Urgent WannaCry Ransomware Cyber Warning Issued

May 12, 2017

U.S. agencies are warning U.S. businesses to batten down their cyber security defenses to guard against a WannaCry ransomware cybersecurity threat sweeping the Globe.

Health care providers, health plans, health insurers, healthcare clearinghouses, their business associates as well as all U.S. businesses and consumers should raise their cyber security defenses and use cyber security best practices to defend their information systems and data against ongoing WannaCry ransomware and other cyber security attacks in the United States and abroad in cyber security alerts issued by the Departments of Homeland Security, Health and Human Service (HHS) and other U.S. agencies today.

Mid-afternoon today, HHS Critical Infrastructure Protection Lead Laura Wolf sent a cyber security alert warning health plans, health providers and health care clearinghouses to tighten their e-mail and other cyber security defenses in response to evidence that cyber attacks affecting hospitals and healthcare information systems in the UK and other international locations” now are “occurring inside the United States.”

A short while later,  the Department of Homeland Security also issued an alert that US-CERT has received multiple reports of WannaCry ransomware infections in several countries around the world.

According the Department of Homeland Security alert, the WannaCry ransomware may be exploiting a vulnerability in Server Message Block 1.0 (SMBv1). For information on how to mitigate this vulnerability, review the US-CERT article on Microsoft SMBv1 Vulnerability and the Microsoft Security Bulletin MS17-010. Users and administrators are encouraged to review the US-CERT Alert TA16-091A to learn how to best protect against ransomware.  The Department of Homeland Security asks that people report any ransomware incidents to the Internet Crime Complaint Center (IC3).

The HHS alert states it is “working with our partners across government and in the private sector to develop a better understanding of the threat and to provide additional information on measures to protect your systems.

Meanwhile, the HHS alert advises U.S. health industry organizations and information systems to exercise cyber security best practices – particularly with respect to email including HHS Ransomware Guidance available here and other information on ransomware in the following HHS Cyber Newsletters:

https://www.hhs.gov/sites/default/files/hippa-cyber-awareness-monthly-issue1.pdf

https://www.hhs.gov/sites/default/files/hipaa-cyber-awareness-monthly-issue3.pdf

https://www.hhs.gov/sites/default/files/february-2017-ocr-cyber-awareness-newsletter.pdf

About The Author

Recognized by LexisNexis® Martindale-Hubbell® as a “AV-Preeminent” (Top 1%/ the highest) and “Top Rated Lawyer,” with special recognition as “LEGAL LEADER™ Texas Top Rated Lawyer” in Health Care Law and Labor and Employment Law; as among the “Best Lawyers In Dallas” for her work in the fields of “Health Care,” “Labor & Employment,” “Tax: Erisa & Employee Benefits” and “Business and Commercial Law” by D Magazine, the author of this update is widely known for her 29 plus years’ of work in health care, health benefit, health policy and regulatory affairs and other health industry concerns as a practicing attorney and management consultant, thought leader, author, public policy advocate and lecturer.

Throughout her adult life and nearly 30-year legal career, Ms. Stamer’s legal, management and governmental affairs work has focused on helping health industry, health benefit and other organizations and their management use the law, performance and risk management tools and process to manage people, performance, quality, compliance, operations and risk.

Highly valued for her rare ability to find pragmatic client-centric solutions by combining her detailed legal and operational knowledge and experience with her talent for creative problem-solving, Ms. Stamer supports these organizations and their leaders on both a real-time, “on demand” basis as well as outsourced operations or special counsel on an interim, special project, or ongoing basis with strategic planning and product and services development and innovation; workforce and operations management, crisis preparedness and response as well as to prevent, stabilize and cleanup legal and operational crises large and small that arise in the course of operations.

As a core component of her work, Ms. Stamer has worked extensively throughout her career with health care providers, health plans and insurers, managed care organizations, health care clearinghouses, their business associates, employers, banks and other financial institutions, management services organizations, professional associations, medical staffs, accreditation agencies, auditors, technology and other vendors and service providers, and others on legal and operational compliance, risk management and compliance, public policies and regulatory affairs, contracting, payer-provider, provider-provider, vendor, patient, governmental and community relations and matters including extensive involvement advising, representing and defending public and private hospitals and health care systems; physicians, physician organizations and medical staffs; specialty clinics and pharmacies; skilled nursing, home health, rehabilitation and other health care providers and facilities; medical staff, accreditation, peer review and quality committees and organizations; billing and management services organizations; consultants; investors; technology, billing and reimbursement and other services and product vendors; products and solutions consultants and developers; investors; managed care organizations, insurers, self-insured health plans and other payers; and other health industry clients to manage and defend compliance, public policy, regulatory, staffing and other operations and risk management concerns.

A core focus of this work includes work to establish and administer compliance and risk management policies; comply with requirements, investigate and respond to Board of Medicine, Health, Nursing, Pharmacy, Chiropractic, and other licensing agencies, Department of Aging & Disability, FDA, Drug Enforcement Agency, OCR Privacy and Civil Rights, Department of Labor, IRS, HHS, DOD, FTC, SEC, CDC and other public health, Department of Justice and state attorneys’ general and other federal and state agencies; dealings with JCHO and other accreditation and quality organizations; investigation and defense of private litigation and other federal and state health care industry investigations and enforcement; insurance or other liability management and allocation; process and product development; managed care, physician and other staffing, business associate and other contracting; evaluation, commenting or seeking modification of regulatory guidance, and other regulatory and public policy advocacy; training and discipline; and a host of other related concerns for public and private health care providers, health insurers, health plans, technology and other vendors, employers, and others.
Author of leading works on HIPAA and other privacy and data security works and the scribe leading the American Bar Association Joint Committee on Employee Benefits Annual Agency Meeting with OCR, her experience includes extensive compliance, risk management and data breach and other crisis event investigation, response and remediation under HIPAA and other data security, privacy and breach laws.

 Heavily involved in health care and health information technology, data and related process and systems development, policy and operations innovation and a Scribe for ABA JCEB annual agency meeting with OCR for many years who has authored numerous highly regarded works and training programs on trade secret, HIPAA and other medical, consumer, insurance, tax, and other privacy and data security, Ms. Stamer also is widely recognized for her extensive work and leadership on leading edge health care and benefit policy and operational issues including meaningful use and EMR, billing and reimbursement, quality measurement and reimbursement, HIPAA, FACTA, PCI, trade secret, physician and other medical confidentiality and privacy, federal and state data security and data breach and other information privacy and data security rules and many other concerns.

In connection with this work, Ms. Stamer has worked extensively with health care providers, health plans, health care clearinghouses, their business associates, employers and other plan sponsors, banks and other financial institutions, and others on risk management and compliance with HIPAA, FACTA, trade secret and other information privacy and data security rules, including the establishment, documentation, implementation, audit and enforcement of policies, procedures, systems and safeguards, investigating and responding to known or suspected breaches, defending investigations or other actions by plaintiffs, OCR and other federal or state agencies, reporting known or suspected violations, business associate and other contracting, commenting or obtaining other clarification of guidance, training and enforcement, and a host of other related concerns. Her clients include public and private health care providers, health insurers, health plans, technology and other vendors, and others.

Her work includes both regulatory and public policy advocacy and thought leadership, as well as advising and representing a broad range of health industry and other clients about policy design, drafting, administration, business associate and other contracting, risk assessments, audits and other risk prevention and mitigation, investigation, reporting, mitigation and resolution of known or suspected violations or other incidents and responding to and defending investigations or other actions by plaintiffs, DOJ, OCR, FTC, state attorneys’ general and other federal or state agencies, other business partners, patients and others.
In addition to representing and advising these organizations, she also has conducted training on Privacy & The Pandemic for the Association of State & Territorial Health Plans, as well as HIPAA, FACTA, PCI, medical confidentiality, insurance confidentiality and other privacy and data security compliance and risk management for Los Angeles County Health Department, MGMA, ISSA, HIMMS, the ABA, SHRM, schools, medical societies, government and private health care and health plan organizations, their business associates, trade associations and others.
A former lead consultant to the Government of Bolivia on its Pension Privatization Project with extensive domestic and international public policy concerns in Pensions, healthcare, workforce, immigration, tax, education and other areas.

The American Bar Association (ABA) International Section Life Sciences Committee Vice Chair, a Scribe for the ABA Joint Committee on Employee Benefits (JCEB) Annual OCR Agency Meeting, former Vice President of the North Texas Health Care Compliance Professionals Association, past Chair of the ABA Health Law Section Managed Care & Insurance Section, past ABA JCEB Council Representative, past Board President of Richardson Development Center (now Warren Center) for Children Early Childhood Intervention Agency, past North Texas United Way Long Range Planning Committee Member, and past Board Member and Compliance Chair of the National Kidney Foundation of North Texas, Ms. Stamer has worked closely with a diverse range of physicians, hospitals and healthcare systems, DME, Pharma, clinics, health care providers, managed care, insurance and other health care payers, quality assurance, credentialing, technical, research, public and private social and community organizations, and other health industry organizations and their management deal with governance; credentialing, patient relations and care; staffing, peer review, human resources and workforce performance management; outsourcing; internal controls and regulatory compliance; billing and reimbursement; physician, employment, vendor, managed care, government and other contracting; business transactions; grants; tax-exemption and not-for-profit; licensure and accreditation; vendor selection and management; privacy and data security; training; risk and change management; regulatory affairs and public policy and other concerns.

Past Chair of the ABA Managed Care & Insurance Interest Group and, a Fellow in the American College of Employee Benefit Counsel, the American Bar Foundation and the Texas Bar Foundation, Ms. Stamer also has extensive health care reimbursement and insurance experience advising and defending health plans, health care providers, payers, and others about Medicare, Medicaid, Medicare and Medicaid Advantage, Tri-Care, self-insured group, association, individual and group and other health benefit programs and coverages including but not limited to advising public and private payers about coverage and program design and documentation, advising and defending providers, payers and systems and billing services entities about systems and process design, audits, and other processes; provider credentialing, and contracting; providers and payer billing, reimbursement, claims audits, denials and appeals, coverage coordination, reporting, direct contracting, False Claims Act, Medicare & Medicaid, ERISA, state Prompt Pay, out-of-network and other “nonpar,” insured, and other health care claims, prepayment, post-payment and other coverage, claims denials, appeals, billing and fraud investigations and actions and other reimbursement and payment related investigation, enforcement, litigation and actions.

A popular lecturer and widely published author on health industry concerns, Ms. Stamer continuously advises health industry clients about compliance and internal controls, workforce and medical staff performance, quality, governance, reimbursement, privacy and data security, and other risk management and operational matters. Ms. Stamer also publishes and speaks extensively on health and managed care industry regulatory, staffing and human resources, compensation and benefits, technology, public policy, reimbursement and other operations and risk management concerns.
A Fellow in the American College of Employee Benefit Counsel, the American Bar Foundation and the Texas Bar Foundation, Ms. Stamer also shares her thought leadership, experience and advocacy on these and other related concerns by her service in the leadership of the Solutions Law Press, Inc. Coalition for Responsible Health Policy, its PROJECT COPE: Coalition on Patient Empowerment, and a broad range of other professional and civic organizations including North Texas Healthcare Compliance Association, a founding Board Member and past President of the Alliance for Healthcare Excellence, past Board Member and Board Compliance Committee Chair for the National Kidney Foundation of North Texas; former Board President of the early childhood development intervention agency, The Richardson Development Center for Children (now Warren Center For Children); current Vice Chair of the ABA Tort & Insurance Practice Section Employee Benefits Committee, current Vice Chair of Policy for the Life Sciences Committee of the ABA International Section, Past Chair of the ABA Health Law Section Managed Care & Insurance Section, a current Defined Contribution Plan Committee Co-Chair, former Group Chair and Co-Chair of the ABA RPTE Section Employee Benefits Group, past Representative and chair of various committees of ABA Joint Committee on Employee Benefits; an ABA Health Law Coordinating Council representative, former Coordinator and a Vice-Chair of the Gulf Coast TEGE Council TE Division, past Chair of the Dallas Bar Association Employee Benefits & Executive Compensation Committee, a former member of the Board of Directors of the Southwest Benefits Association and others.

Ms. Stamer also is a highly popular lecturer, symposium and chair, faculty member and author, who publishes and speaks extensively on health and managed care industry, human resources, employment and other privacy, data security and other technology, regulatory and operational risk management. Examples of her many highly regarded publications on these matters include “Protecting & Using Patient Data In Disease Management: Opportunities, Liabilities And Prescriptions,” “Privacy Invasions of Medical Care-An Emerging Perspective,” “Cybercrime and Identity Theft: Health Information Security: Beyond HIPAA,” as well as thousands of other publications, programs and workshops these and other concerns for the American Bar Association, ALI-ABA, American Health Lawyers, Society of Human Resources Professionals, the Southwest Benefits Association, the Society of Employee Benefits Administrators, the American Law Institute, Lexis-Nexis, Atlantic Information Services, The Bureau of National Affairs (BNA), InsuranceThoughtLeaders.com, Benefits Magazine, Employee Benefit News, Texas CEO Magazine, HealthLeaders, the HCCA, ISSA, HIMSS, Modern Healthcare, Managed Healthcare, Institute of Internal Auditors, Society of CPAs, Business Insurance, Employee Benefits News, World At Work, Benefits Magazine, the Wall Street Journal, the Dallas Morning News, the Dallas Business Journal, the Houston Business Journal, and many other symposia and publications. She also has served as an Editorial Advisory Board Member for human resources, employee benefit and other management focused publications of BNA, HR.com, Employee Benefit News, Insurance Thought Leadership and many other prominent publications and speaks and conducts training for a broad range of professional organizations.

For more information about Ms. Stamer or her health industry and other experience and involvements, see here or contact Ms. Stamer via telephone at (469) 767-8872 or via e-mail here.

About Solutions Law Press, Inc.™

Solutions Law Press, Inc.™ provides human resources and employee benefit and other business risk management, legal compliance, management effectiveness and other coaching, tools and other resources, training and education on leadership, governance, human resources, employee benefits, data security and privacy, insurance, health care and other key compliance, risk management, internal controls and operational concerns. If you find this of interest, you also be interested reviewing some of our other Solutions Law Press, Inc.™ resources here.
If you or someone else you know would like to receive future updates about developments on these and other concerns, please be sure that we have your current contact information including your preferred e-mail by creating your profile here.

©2017 Cynthia Marcotte Stamer. Non-exclusive right to republish granted to Solutions Law Press, Inc.™ All other rights reserved. For information about republication or other use, please contact Ms. Stamer here.


Alert: Guard Health E-Mail, Other IT Against WannaCry Malware Attack

May 12, 2017

U.S. agencies are warning U.S. businesses to batten down their cyber security defenses to guard against a WannaCry ransomware cybersecurity threat sweeping the Globe.

Health care providers, health plans, health insurers, healthcare clearinghouses, their business associates as well as all U.S. businesses and consumers should raise their cyber security defenses and use cyber security best practices to defend their information systems and data against ongoing WannaCry ransomware and other cyber security attacks in the United States and abroad in cyber security alerts issued by the Departments of Homeland Security, Health and Human Service (HHS) and other U.S. agencies today.

Mid-afternoon today, HHS Critical Infrastructure Protection Lead Laura Wolf sent a cyber security alert warning health plans, health providers and health care clearinghouses to tighten their e-mail and other cyber security defenses in response to evidence that cyber attacks affecting hospitals and healthcare information systems in the UK and other international locations” now are “occurring inside the United States.”

A short while later,  the Department of Homeland Security also issued an alert that US-CERT has received multiple reports of WannaCry ransomware infections in several countries around the world.

According the Department of Homeland Security alert, the WannaCry ransomware may be exploiting a vulnerability in Server Message Block 1.0 (SMBv1). For information on how to mitigate this vulnerability, review the US-CERT article on Microsoft SMBv1 Vulnerability and the Microsoft Security Bulletin MS17-010. Users and administrators are encouraged to review the US-CERT Alert TA16-091A to learn how to best protect against ransomware.  The Department of Homeland Security asks that people report any ransomware incidents to the Internet Crime Complaint Center (IC3).

The HHS alert states it is “working with our partners across government and in the private sector to develop a better understanding of the threat and to provide additional information on measures to protect your systems.

Meanwhile, the HHS alert advises U.S. health industry organizations and information systems to exercise cyber security best practices – particularly with respect to email including HHS Ransomware Guidance available here and other information on ransomware in the following HHS Cyber Newsletters:

https://www.hhs.gov/sites/default/files/hippa-cyber-awareness-monthly-issue1.pdf

https://www.hhs.gov/sites/default/files/hipaa-cyber-awareness-monthly-issue3.pdf

https://www.hhs.gov/sites/default/files/february-2017-ocr-cyber-awareness-newsletter.pdf

About The Author

Recognized by LexisNexis® Martindale-Hubbell® as a “AV-Preeminent” (Top 1%/ the highest) and “Top Rated Lawyer,” with special recognition as “LEGAL LEADER™ Texas Top Rated Lawyer” in Health Care Law and Labor and Employment Law; as among the “Best Lawyers In Dallas” for her work in the fields of “Health Care,” “Labor & Employment,” “Tax: Erisa & Employee Benefits” and “Business and Commercial Law” by D Magazine, the author of this update is widely known for her 29 plus years’ of work in health care, health benefit, health policy and regulatory affairs and other health industry concerns as a practicing attorney and management consultant, thought leader, author, public policy advocate and lecturer.

Throughout her adult life and nearly 30-year legal career, Ms. Stamer’s legal, management and governmental affairs work has focused on helping health industry, health benefit and other organizations and their management use the law, performance and risk management tools and process to manage people, performance, quality, compliance, operations and risk.

Highly valued for her rare ability to find pragmatic client-centric solutions by combining her detailed legal and operational knowledge and experience with her talent for creative problem-solving, Ms. Stamer supports these organizations and their leaders on both a real-time, “on demand” basis as well as outsourced operations or special counsel on an interim, special project, or ongoing basis with strategic planning and product and services development and innovation; workforce and operations management, crisis preparedness and response as well as to prevent, stabilize and cleanup legal and operational crises large and small that arise in the course of operations.

As a core component of her work, Ms. Stamer has worked extensively throughout her career with health care providers, health plans and insurers, managed care organizations, health care clearinghouses, their business associates, employers, banks and other financial institutions, management services organizations, professional associations, medical staffs, accreditation agencies, auditors, technology and other vendors and service providers, and others on legal and operational compliance, risk management and compliance, public policies and regulatory affairs, contracting, payer-provider, provider-provider, vendor, patient, governmental and community relations and matters including extensive involvement advising, representing and defending public and private hospitals and health care systems; physicians, physician organizations and medical staffs; specialty clinics and pharmacies; skilled nursing, home health, rehabilitation and other health care providers and facilities; medical staff, accreditation, peer review and quality committees and organizations; billing and management services organizations; consultants; investors; technology, billing and reimbursement and other services and product vendors; products and solutions consultants and developers; investors; managed care organizations, insurers, self-insured health plans and other payers; and other health industry clients to manage and defend compliance, public policy, regulatory, staffing and other operations and risk management concerns.

A core focus of this work includes work to establish and administer compliance and risk management policies; comply with requirements, investigate and respond to Board of Medicine, Health, Nursing, Pharmacy, Chiropractic, and other licensing agencies, Department of Aging & Disability, FDA, Drug Enforcement Agency, OCR Privacy and Civil Rights, Department of Labor, IRS, HHS, DOD, FTC, SEC, CDC and other public health, Department of Justice and state attorneys’ general and other federal and state agencies; dealings with JCHO and other accreditation and quality organizations; investigation and defense of private litigation and other federal and state health care industry investigations and enforcement; insurance or other liability management and allocation; process and product development; managed care, physician and other staffing, business associate and other contracting; evaluation, commenting or seeking modification of regulatory guidance, and other regulatory and public policy advocacy; training and discipline; and a host of other related concerns for public and private health care providers, health insurers, health plans, technology and other vendors, employers, and others.
Author of leading works on HIPAA and other privacy and data security works and the scribe leading the American Bar Association Joint Committee on Employee Benefits Annual Agency Meeting with OCR, her experience includes extensive compliance, risk management and data breach and other crisis event investigation, response and remediation under HIPAA and other data security, privacy and breach laws.

 Heavily involved in health care and health information technology, data and related process and systems development, policy and operations innovation and a Scribe for ABA JCEB annual agency meeting with OCR for many years who has authored numerous highly regarded works and training programs on trade secret, HIPAA and other medical, consumer, insurance, tax, and other privacy and data security, Ms. Stamer also is widely recognized for her extensive work and leadership on leading edge health care and benefit policy and operational issues including meaningful use and EMR, billing and reimbursement, quality measurement and reimbursement, HIPAA, FACTA, PCI, trade secret, physician and other medical confidentiality and privacy, federal and state data security and data breach and other information privacy and data security rules and many other concerns.

In connection with this work, Ms. Stamer has worked extensively with health care providers, health plans, health care clearinghouses, their business associates, employers and other plan sponsors, banks and other financial institutions, and others on risk management and compliance with HIPAA, FACTA, trade secret and other information privacy and data security rules, including the establishment, documentation, implementation, audit and enforcement of policies, procedures, systems and safeguards, investigating and responding to known or suspected breaches, defending investigations or other actions by plaintiffs, OCR and other federal or state agencies, reporting known or suspected violations, business associate and other contracting, commenting or obtaining other clarification of guidance, training and enforcement, and a host of other related concerns. Her clients include public and private health care providers, health insurers, health plans, technology and other vendors, and others.

Her work includes both regulatory and public policy advocacy and thought leadership, as well as advising and representing a broad range of health industry and other clients about policy design, drafting, administration, business associate and other contracting, risk assessments, audits and other risk prevention and mitigation, investigation, reporting, mitigation and resolution of known or suspected violations or other incidents and responding to and defending investigations or other actions by plaintiffs, DOJ, OCR, FTC, state attorneys’ general and other federal or state agencies, other business partners, patients and others.
In addition to representing and advising these organizations, she also has conducted training on Privacy & The Pandemic for the Association of State & Territorial Health Plans, as well as HIPAA, FACTA, PCI, medical confidentiality, insurance confidentiality and other privacy and data security compliance and risk management for Los Angeles County Health Department, MGMA, ISSA, HIMMS, the ABA, SHRM, schools, medical societies, government and private health care and health plan organizations, their business associates, trade associations and others.
A former lead consultant to the Government of Bolivia on its Pension Privatization Project with extensive domestic and international public policy concerns in Pensions, healthcare, workforce, immigration, tax, education and other areas.

The American Bar Association (ABA) International Section Life Sciences Committee Vice Chair, a Scribe for the ABA Joint Committee on Employee Benefits (JCEB) Annual OCR Agency Meeting, former Vice President of the North Texas Health Care Compliance Professionals Association, past Chair of the ABA Health Law Section Managed Care & Insurance Section, past ABA JCEB Council Representative, past Board President of Richardson Development Center (now Warren Center) for Children Early Childhood Intervention Agency, past North Texas United Way Long Range Planning Committee Member, and past Board Member and Compliance Chair of the National Kidney Foundation of North Texas, Ms. Stamer has worked closely with a diverse range of physicians, hospitals and healthcare systems, DME, Pharma, clinics, health care providers, managed care, insurance and other health care payers, quality assurance, credentialing, technical, research, public and private social and community organizations, and other health industry organizations and their management deal with governance; credentialing, patient relations and care; staffing, peer review, human resources and workforce performance management; outsourcing; internal controls and regulatory compliance; billing and reimbursement; physician, employment, vendor, managed care, government and other contracting; business transactions; grants; tax-exemption and not-for-profit; licensure and accreditation; vendor selection and management; privacy and data security; training; risk and change management; regulatory affairs and public policy and other concerns.

Past Chair of the ABA Managed Care & Insurance Interest Group and, a Fellow in the American College of Employee Benefit Counsel, the American Bar Foundation and the Texas Bar Foundation, Ms. Stamer also has extensive health care reimbursement and insurance experience advising and defending health plans, health care providers, payers, and others about Medicare, Medicaid, Medicare and Medicaid Advantage, Tri-Care, self-insured group, association, individual and group and other health benefit programs and coverages including but not limited to advising public and private payers about coverage and program design and documentation, advising and defending providers, payers and systems and billing services entities about systems and process design, audits, and other processes; provider credentialing, and contracting; providers and payer billing, reimbursement, claims audits, denials and appeals, coverage coordination, reporting, direct contracting, False Claims Act, Medicare & Medicaid, ERISA, state Prompt Pay, out-of-network and other “nonpar,” insured, and other health care claims, prepayment, post-payment and other coverage, claims denials, appeals, billing and fraud investigations and actions and other reimbursement and payment related investigation, enforcement, litigation and actions.

A popular lecturer and widely published author on health industry concerns, Ms. Stamer continuously advises health industry clients about compliance and internal controls, workforce and medical staff performance, quality, governance, reimbursement, privacy and data security, and other risk management and operational matters. Ms. Stamer also publishes and speaks extensively on health and managed care industry regulatory, staffing and human resources, compensation and benefits, technology, public policy, reimbursement and other operations and risk management concerns.
A Fellow in the American College of Employee Benefit Counsel, the American Bar Foundation and the Texas Bar Foundation, Ms. Stamer also shares her thought leadership, experience and advocacy on these and other related concerns by her service in the leadership of the Solutions Law Press, Inc. Coalition for Responsible Health Policy, its PROJECT COPE: Coalition on Patient Empowerment, and a broad range of other professional and civic organizations including North Texas Healthcare Compliance Association, a founding Board Member and past President of the Alliance for Healthcare Excellence, past Board Member and Board Compliance Committee Chair for the National Kidney Foundation of North Texas; former Board President of the early childhood development intervention agency, The Richardson Development Center for Children (now Warren Center For Children); current Vice Chair of the ABA Tort & Insurance Practice Section Employee Benefits Committee, current Vice Chair of Policy for the Life Sciences Committee of the ABA International Section, Past Chair of the ABA Health Law Section Managed Care & Insurance Section, a current Defined Contribution Plan Committee Co-Chair, former Group Chair and Co-Chair of the ABA RPTE Section Employee Benefits Group, past Representative and chair of various committees of ABA Joint Committee on Employee Benefits; an ABA Health Law Coordinating Council representative, former Coordinator and a Vice-Chair of the Gulf Coast TEGE Council TE Division, past Chair of the Dallas Bar Association Employee Benefits & Executive Compensation Committee, a former member of the Board of Directors of the Southwest Benefits Association and others.

Ms. Stamer also is a highly popular lecturer, symposium and chair, faculty member and author, who publishes and speaks extensively on health and managed care industry, human resources, employment and other privacy, data security and other technology, regulatory and operational risk management. Examples of her many highly regarded publications on these matters include “Protecting & Using Patient Data In Disease Management: Opportunities, Liabilities And Prescriptions,” “Privacy Invasions of Medical Care-An Emerging Perspective,” “Cybercrime and Identity Theft: Health Information Security: Beyond HIPAA,” as well as thousands of other publications, programs and workshops these and other concerns for the American Bar Association, ALI-ABA, American Health Lawyers, Society of Human Resources Professionals, the Southwest Benefits Association, the Society of Employee Benefits Administrators, the American Law Institute, Lexis-Nexis, Atlantic Information Services, The Bureau of National Affairs (BNA), InsuranceThoughtLeaders.com, Benefits Magazine, Employee Benefit News, Texas CEO Magazine, HealthLeaders, the HCCA, ISSA, HIMSS, Modern Healthcare, Managed Healthcare, Institute of Internal Auditors, Society of CPAs, Business Insurance, Employee Benefits News, World At Work, Benefits Magazine, the Wall Street Journal, the Dallas Morning News, the Dallas Business Journal, the Houston Business Journal, and many other symposia and publications. She also has served as an Editorial Advisory Board Member for human resources, employee benefit and other management focused publications of BNA, HR.com, Employee Benefit News, Insurance Thought Leadership and many other prominent publications and speaks and conducts training for a broad range of professional organizations.

For more information about Ms. Stamer or her health industry and other experience and involvements, see here or contact Ms. Stamer via telephone at (469) 767-8872 or via e-mail here.

About Solutions Law Press, Inc.™

Solutions Law Press, Inc.™ provides human resources and employee benefit and other business risk management, legal compliance, management effectiveness and other coaching, tools and other resources, training and education on leadership, governance, human resources, employee benefits, data security and privacy, insurance, health care and other key compliance, risk management, internal controls and operational concerns. If you find this of interest, you also be interested reviewing some of our other Solutions Law Press, Inc.™ resources here.
If you or someone else you know would like to receive future updates about developments on these and other concerns, please be sure that we have your current contact information including your preferred e-mail by creating your profile here.

©2017 Cynthia Marcotte Stamer. Non-exclusive right to republish granted to Solutions Law Press, Inc.™ All other rights reserved. For information about republication or other use, please contact Ms. Stamer here.


$2.4M HIPAA Settlement Message Warns Health Plans & Providers Against Sharing Medical Info With Media, Others

May 10, 2017

Healthcare providers, health plans, healthcare clearinghouses and their business associates (Covered Entities) can’t disclose the name or other protected health care information about a patient in press releases or other announcements without prior authorization from the patient. That’s the clear lesson Covered Entities should learn from the $2.4 million payment to the U.S. Department of Health and Human Services (HHS) that the largest not-for-profit health system in Southeast Texas, Memorial Hermann Health System (MHHS) is paying to settle charges it violated the Health Insurance Portability and Accountability Act (HIPAA) Privacy Rule by issuing a press release with the name and other protected health information (PHI) about a patient without the patient’s prior HIPAA-compliant authorization under a Resolution Agreement and Corrective Action Plan (Resolution Agreement) announced May 10, 2017 by HHS Office of Civil Rights (OCR).

The Resolution Agreement resolves OCR charges the operator of 13 hospitals, eight Cancer Centers, three Heart & Vascular Institutes, and 27 sports medicine and rehabilitation centers violated the Privacy Rule that resulted from an OCR compliance review of MHHS triggered by multiple media reports suggesting that MHHS improperly disclosed the name and other details about a patient arrested and charged with presenting an allegedly fraudulent identification card to office staff at an MHHS’s clinic after MHHS clinic staff alerted law enforcement of suspicions the patient was presenting false identification to the clinic. According to OCR, after law enforcement investigated and arrested the patient, MHHS published a press release concerning the incident in which MHHS senior management approved the impermissible disclosure of the patient’s PHI by adding the patient’s name in the title of the press release without securing prior authorization of the patient.

While OCR concluded the report to law enforcement allowable under the Privacy Rule, OCR found MHHS violated the Privacy Rule by issuing the press release disclosing the patient’s name and other PHI without authorization from the patient and also by failing to timely document the sanctioning of its workforce members for impermissibly disclosing the patient’s information.

To resolve and avoid the potential Civil Monetary Penalties that HIPAA could authorize OCR to impose for the alleged Privacy Rule violation, MHHS agrees in the Resolution Agreement to pay OCR a $2.4 million monetary settlement and implement a corrective action plan that obligates MHHS to update and train its workforce on its policies and procedures on safeguarding PHI from impermissible uses and disclosures including specific instructions and procedures to:

  • Address (a) Uses and disclosures for which an authorization is required, including to the media, to public officials, and on the internet; (b) Disclosures for law enforcement purposes; and (c) Uses and disclosures for health oversight activities;
  • Identify MHHS personnel or representatives whom workforce members, agents, or business associates may contact in the event of any inquiry or concern regarding compliance with HIPAA in relation to these activities;
  • Internal reporting procedures requiring all workforce members to report to the designated person or office at the earliest possible time any potential violations of the Privacy, Security or Breach Notification Rules or of MHHS’ privacy and security policies and procedures and MHHS promptly to investigate and address all received reports in a timely manner; and
  • Application and documentation of appropriate sanctions (which may include retraining or other instructive corrective action, depending on the circumstances) against members of MHHS’ workforce, including senior level management, who fail to comply with the Privacy, Security or Breach Notification Rules or MHHS’ privacy and security policies and procedures, including a description of the sanctions; a timeframe in which MHHS will apply and document sanctions for violations of the HIPAA Rules or of MHHS’ privacy, security or breach policies or procedures; the manner in which MHHS will document the sanctions; and where MHHS will store or retain such documentation (e.g., personnel file).

The corrective action plan in the Resolution Agreement also requires all MHHS facilities to attest to their understanding of permissible uses and disclosures of PHI, including disclosures to the media and others.

Covered entities should keep in mind the MHHS Resolution Agreement is the latest in a series of OCR enforcement actions and resolution agreements highlighting the need for Covered Entities to adopt and use appropriate policies and procedures to prevent wrongful disclosures of PHI to the media or public. For instance, in June, 2013, OCR required Shasta Regional Medical Center (SRMC) to pay a $275,000 settlement payment and implement a comprehensive corrective action plan to resolve OCR charges stemming from SRMC’s disclosure of PHI about a patient to members of the media and its workforce in an effort to respond to accusations the patient made that SRMC engaged in fraud and other misconduct. See HIPAA Sanctions Triggered From Covered Entity Statements To Media, Workforce.  In contrast, the $2.2 million resolution agreement that OCR required New York Presbyterian Hospital for improperly allowing a film crew to film hospital patients in violation of HIPAA was almost 10 times greater than the SRMC penalty and was accompanied by OCR’s publication OCR of specific additional guidance warning Covered Entities against improper disclosures to the media. See $2 Million+ HIPAA Settlement, FAQ Warn Providers Protect PHI From Media, Other Recording Or Use.

Following on the heels of this previous guidance and prior enforcement actions warning Covered Entities against wrongful disclosure to the media, the MHHS Resolution Agreement sends a strong message to Covered Entities that they should expect little sympathy if their organizations improperly share PHI with the media. OCR’s announcement of the MHHS Resolution Agreement, for instance quotes OCR Director Roger Severino with stating that “Senior management should have known that disclosing a patient’s name on the title of a press release was a clear HIPAA Privacy violation that would induce a swift OCR response.” The announcement goes on to quote Director Severino further as stating, “This case reminds us that organizations can readily cooperate with law enforcement without violating HIPAA, but that they must nevertheless continue to protect patient privacy when making statements to the public and elsewhere.”

Conduct Entity-Wide Risk Assessment & Review & Tighten Media Relations Policies, Processes & Training ASAP

Covered entities should heed the warning by conducting a risk assessment of their organization’s susceptibility to potential improper disclosures to media or others and reviewing and implementing necessary written policies, procedures and training to prevent the improper disclosure of patient PHI to media or others unless the Covered Entity either secures prior HIPAA-compliant authorization from the patient or can prove the disclosure falls squarely under an exception to the Privacy Rule’s prohibition against disclosure of PHI without authorization except as allowed by the Privacy Rule.

Taking these and other needed steps to evaluate, and strengthen and enforce as needed, risk assessments, policies, procedures, and training to prevent wrongful use, access or disclosure of PHI to the media or others is particularly critical in light of the ongoing tightening of expectations, and rising enforcement and sanctions for HIPAA violations since Congress amended HIPAA in 2009. See OCR Audit Program Kickoff Further Heats HIPAA Privacy RisksHIPAA Heats Up: HITECH Act Changes Take Effect & OCR Begins Posting Names, Other Details Of Unsecured PHI Breach Reports On Website

Based on experiences reported in the MHHS and other similar resolution agreements, Covered Entities also generally will want to ensure that their policies, procedures and training extend to all potential sources of communications that could involve patient information and make clear that the Privacy Rule restrictions must be followed even if the circumstances involve allegations of misconduct, special performance by healthcare providers or others that it would benefit the organization or certain individuals to have known to the public, or other circumstances likely to be of interest to the media or other parties.

As part of this process, covered entities should ensure they look outside the four corners of their Privacy Policies to ensure that appropriate training and clarification is provided to address media, practice transition, workforce communication and other policies and practices that may be covered by pre-existing or other policies of other departments or operational elements not typically under the direct oversight and management of the Privacy Officer such as media relations.  Media relations, physician and patients affairs, outside legal counsel, media relations, marketing and other internal and external departments and consultants dealing with the media, the public or other inquiries or disputes should carefully include and coordinate with the privacy officer both to ensure appropriate policies and procedures are followed and proper documentation created and retained to show authorization, account, or meet other requirements.

In conducting this analysis and risk assessment, it will be important that Covered Entities include, but also look beyond the four corners of their Privacy Policies to ensure that their review and risk assessment identifies and assesses and addresses compliance risks on an entity wide basis. This entity-wide assessment should include both communications and requests for information normally addressed to the Privacy Officer as well as requests and communications that could arise in the course of media or other public relations, practice transition, workforce communication and other operations not typically under the direct oversight and management of the Privacy Officer.  For this reason, Covered Entities also generally will not only to adopt and implement specific policies, processes and training in these other departments to prohibit and prevent inappropriate disclosures of PHI in the course of those departments operations. It also may be advisable to pre-established processes for reviewing media or other communications for potential PHI content and require prior review of any proposed public relations and other internal or external communications containing patient PHI or other information by the privacy officer, legal counsel or another suitably qualified party.

Because of the high risk that the preparation or review of media or other public communications reports will involve the use and disclosure of PHI, Covered Entities also generally should verify that all outside media or public relations, legal, or other outside service providers participating in the investigation, response or preparation or review of communications to the media or others both are covered by signed business associate agreements that fulfill the Privacy Rule and other requirements of HIPAA as well as possess detailed knowledge and understanding of the Privacy and Security Rules suitable to participate in and help safeguard the Covered Entity against violations of these and other Privacy Rules.  See e.g., Latest HIPAA Resolution Agreement Drives Home Importance Of Maintaining Current, Signed Business Associate Agreements.

About The Author

Recognized by LexisNexis® Martindale-Hubbell® as a “AV-Preeminent” (Top 1%/ the highest) and “Top Rated Lawyer,” with special recognition as “LEGAL LEADER™ Texas Top Rated Lawyer” in Health Care Law and Labor and Employment Law; as among the “Best Lawyers In Dallas” for her work in the fields of “Health Care,” “Labor & Employment,” “Tax: Erisa & Employee Benefits” and “Business and Commercial Law” by D Magazine, the author of this update is widely known for her 29 plus years’ of work in health care, health benefit, health policy and regulatory affairs and other health industry concerns as a practicing attorney and management consultant, thought leader, author, public policy advocate and lecturer.

Throughout her adult life and nearly 30-year legal career, Ms. Stamer’s legal, management and governmental affairs work has focused on helping health industry, health benefit and other organizations and their management use the law, performance and risk management tools and process to manage people, performance, quality, compliance, operations and risk. Highly valued for her rare ability to find pragmatic client-centric solutions by combining her detailed legal and operational knowledge and experience with her talent for creative problem-solving, Ms. Stamer supports these organizations and their leaders on both a real-time, “on demand” basis as well as outsourced operations or special counsel on an interim, special project, or ongoing basis with strategic planning and product and services development and innovation; workforce and operations management, crisis preparedness and response as well as to prevent, stabilize and cleanup legal and operational crises large and small that arise in the course of operations.

As a core component of her work, Ms. Stamer has worked extensively throughout her career with health care providers, health plans and insurers, managed care organizations, health care clearinghouses, their business associates, employers, banks and other financial institutions, management services organizations, professional associations, medical staffs, accreditation agencies, auditors, technology and other vendors and service providers, and others on legal and operational compliance, risk management and compliance, public policies and regulatory affairs, contracting, payer-provider, provider-provider, vendor, patient, governmental and community relations and matters including extensive involvement advising, representing and defending public and private hospitals and health care systems; physicians, physician organizations and medical staffs; specialty clinics and pharmacies; skilled nursing, home health, rehabilitation and other health care providers and facilities; medical staff, accreditation, peer review and quality committees and organizations; billing and management services organizations; consultants; investors; technology, billing and reimbursement and other services and product vendors; products and solutions consultants and developers; investors; managed care organizations, insurers, self-insured health plans and other payers; and other health industry clients to manage and defend compliance, public policy, regulatory, staffing and other operations and risk management concerns. A core focus of this work includes work to establish and administer compliance and risk management policies; comply with requirements, investigate and respond to Board of Medicine, Health, Nursing, Pharmacy, Chiropractic, and other licensing agencies, Department of Aging & Disability, FDA, Drug Enforcement Agency, OCR Privacy and Civil Rights, Department of Labor, IRS, HHS, DOD, FTC, SEC, CDC and other public health, Department of Justice and state attorneys’ general and other federal and state agencies; dealings with JCHO and other accreditation and quality organizations; investigation and defense of private litigation and other federal and state health care industry investigations and enforcement; insurance or other liability management and allocation; process and product development; managed care, physician and other staffing, business associate and other contracting; evaluation, commenting or seeking modification of regulatory guidance, and other regulatory and public policy advocacy; training and discipline; and a host of other related concerns for public and private health care providers, health insurers, health plans, technology and other vendors, employers, and others.

Author of leading works on HIPAA and other privacy and data security works and the scribe leading the American Bar Association Joint Committee on Employee Benefits Annual Agency Meeting with OCR, her experience includes extensive compliance, risk management and data breach and other crisis event investigation, response and remediation under HIPAA and other data security, privacy and breach laws.  Heavily involved in health care and health information technology, data and related process and systems development, policy and operations innovation and a Scribe for ABA JCEB annual agency meeting with OCR for many years who has authored numerous highly regarded works and training programs on trade secret, HIPAA and other medical, consumer, insurance, tax, and other  privacy and data security, Ms. Stamer also is widely recognized for her extensive work and leadership on leading edge health care and benefit policy and operational issues including meaningful use and EMR, billing and reimbursement, quality measurement and reimbursement, HIPAA, FACTA, PCI, trade secret, physician and other medical confidentiality and privacy, federal and state data security and data breach and other information privacy and data security rules and many other concerns.

In connection with this work, Ms. Stamer has worked extensively with health care providers, health plans, health care clearinghouses, their business associates, employers and other plan sponsors, banks and other financial institutions, and others on risk management and compliance with HIPAA, FACTA, trade secret and other information privacy and data security rules, including the establishment, documentation, implementation, audit and enforcement of policies, procedures, systems and safeguards, investigating and responding to known or suspected breaches, defending investigations or other actions by plaintiffs, OCR and other federal or state agencies, reporting known or suspected violations, business associate and other contracting, commenting or obtaining other clarification of guidance, training and enforcement, and a host of other related concerns. Her clients include public and private health care providers, health insurers, health plans, technology and other vendors, and others.

Her work includes both regulatory and public policy advocacy and thought leadership, as well as advising and representing a broad range of health industry and other clients about policy design, drafting, administration, business associate and other contracting, risk assessments, audits and other risk prevention and mitigation, investigation, reporting, mitigation and resolution of known or suspected violations or other incidents and responding to and defending investigations or other actions by plaintiffs, DOJ, OCR, FTC, state attorneys’ general and other federal or state agencies, other business partners, patients and others.

In addition to representing and advising these organizations, she also has conducted training on Privacy & The Pandemic for the Association of State & Territorial Health Plans, as well as HIPAA, FACTA, PCI, medical confidentiality, insurance confidentiality and other privacy and data security compliance and risk management for Los Angeles County Health Department, MGMA, ISSA, HIMMS, the ABA, SHRM, schools, medical societies, government and private health care and health plan organizations, their business associates, trade associations and others.

A former lead consultant to the Government of Bolivia on its Pension Privatization Project with extensive domestic and international public policy concerns in Pensions, healthcare, workforce, immigration, tax, education and other areas.

The American Bar Association (ABA) International Section Life Sciences Committee Vice Chair, a Scribe for the ABA Joint Committee on Employee Benefits (JCEB) Annual OCR Agency Meeting, former Vice President of the North Texas Health Care Compliance Professionals Association, past Chair of the ABA Health Law Section Managed Care & Insurance Section, past ABA JCEB Council Representative, past Board President of Richardson Development Center (now Warren Center) for Children Early Childhood Intervention Agency, past North Texas United Way Long Range Planning Committee Member, and past Board Member and Compliance Chair of the National Kidney Foundation of North Texas, Ms. Stamer has worked closely with a diverse range of physicians, hospitals and healthcare systems, DME, Pharma, clinics, health care providers, managed care, insurance and other health care payers, quality assurance, credentialing, technical, research, public and private social and community organizations, and other health industry organizations and their management deal with governance; credentialing, patient relations and care; staffing, peer review, human resources and workforce performance management; outsourcing; internal controls and regulatory compliance; billing and reimbursement; physician, employment, vendor, managed care, government and other contracting; business transactions; grants; tax-exemption and not-for-profit; licensure and accreditation; vendor selection and management; privacy and data security; training; risk and change management; regulatory affairs and public policy and other concerns.

Past Chair of the ABA Managed Care & Insurance Interest Group and, a Fellow in the American College of Employee Benefit Counsel, the American Bar Foundation and the Texas Bar Foundation, Ms. Stamer also has extensive health care reimbursement and insurance experience advising and defending health plans, health care providers, payers, and others about Medicare, Medicaid, Medicare and Medicaid Advantage, Tri-Care, self-insured group, association, individual and group and other health benefit programs and coverages including but not limited to advising public and private payers about coverage and program design and documentation, advising and defending providers, payers and systems and billing services entities about systems and process design, audits, and other processes; provider credentialing, and contracting; providers and payer billing, reimbursement, claims audits, denials and appeals, coverage coordination, reporting, direct contracting, False Claims Act, Medicare & Medicaid, ERISA, state Prompt Pay, out-of-network and other “nonpar,” insured, and other health care claims, prepayment, post-payment and other coverage, claims denials, appeals, billing and fraud investigations and actions and other reimbursement and payment related investigation, enforcement, litigation and actions.

A popular lecturer and widely published author on health industry concerns, Ms. Stamer continuously advises health industry clients about compliance and internal controls, workforce and medical staff performance, quality, governance, reimbursement, privacy and data security, and other risk management and operational matters. Ms. Stamer also publishes and speaks extensively on health and managed care industry regulatory, staffing and human resources, compensation and benefits, technology, public policy, reimbursement and other operations and risk management concerns.

A Fellow in the American College of Employee Benefit Counsel, the American Bar Foundation and the Texas Bar Foundation, Ms. Stamer also shares her thought leadership, experience and advocacy on these and other related concerns by her service in the leadership of the Solutions Law Press, Inc. Coalition for Responsible Health Policy, its PROJECT COPE: Coalition on Patient Empowerment, and a broad range of other professional and civic organizations including North Texas Healthcare Compliance Association, a founding Board Member and past President of the Alliance for Healthcare Excellence, past Board Member and Board Compliance Committee Chair for the National Kidney Foundation of North Texas; former Board President of the early childhood development intervention agency, The Richardson Development Center for Children (now Warren Center For Children); current Vice Chair of the ABA Tort & Insurance Practice Section Employee Benefits Committee, current Vice Chair of Policy for the Life Sciences Committee of the ABA International Section, Past Chair of the ABA Health Law Section Managed Care & Insurance Section, a current Defined Contribution Plan Committee Co-Chair, former Group Chair and Co-Chair of the ABA RPTE Section Employee Benefits Group, past Representative and chair of various committees of ABA Joint Committee on Employee Benefits; an ABA Health Law Coordinating Council representative, former Coordinator and a Vice-Chair of the Gulf Coast TEGE Council TE Division, past Chair of the Dallas Bar Association Employee Benefits & Executive Compensation Committee, a former member of the Board of Directors of the Southwest Benefits Association and others.

Ms. Stamer also is a highly popular lecturer, symposium and chair, faculty member and author, who publishes and speaks extensively on health and managed care industry, human resources, employment and other privacy, data security and other technology, regulatory and operational risk management. Examples of her many highly regarded publications on these matters include “Protecting & Using Patient Data In Disease Management: Opportunities, Liabilities And Prescriptions,” “Privacy Invasions of Medical Care-An Emerging Perspective,” “Cybercrime and Identity Theft: Health Information Security: Beyond HIPAA,” as well as thousands of other publications, programs and workshops these and other concerns for the American Bar Association, ALI-ABA, American Health Lawyers, Society of Human Resources Professionals, the Southwest Benefits Association, the Society of Employee Benefits Administrators, the American Law Institute, Lexis-Nexis, Atlantic Information Services, The Bureau of National Affairs (BNA), InsuranceThoughtLeaders.com, Benefits Magazine, Employee Benefit News, Texas CEO Magazine, HealthLeaders, the HCCA, ISSA, HIMSS, Modern Healthcare, Managed Healthcare, Institute of Internal Auditors, Society of CPAs, Business Insurance, Employee Benefits News, World At Work, Benefits Magazine, the Wall Street Journal, the Dallas Morning News, the Dallas Business Journal, the Houston Business Journal, and many other symposia and publications. She also has served as an Editorial Advisory Board Member for human resources, employee benefit and other management focused publications of BNA, HR.com, Employee Benefit News, Insurance Thought Leadership and many other prominent publications and speaks and conducts training for a broad range of professional organizations.

For more information about Ms. Stamer or her health industry and other experience and involvements, see here or contact Ms. Stamer via telephone at (469) 767-8872 or via e-mail here.

About Solutions Law Press, Inc.™

Solutions Law Press, Inc.™ provides human resources and employee benefit and other business risk management, legal compliance, management effectiveness and other coaching, tools and other resources, training and education on leadership, governance, human resources, employee benefits, data security and privacy, insurance, health care and other key compliance, risk management, internal controls and operational concerns. If you find this of interest, you also be interested reviewing some of our other Solutions Law Press, Inc.™ resources here.

If you or someone else you know would like to receive future updates about developments on these and other concerns, please be sure that we have your current contact information including your preferred e-mail by creating your profile here.

©2017 Cynthia Marcotte Stamer. Non-exclusive right to republish granted to Solutions Law Press, Inc.™ All other rights reserved. For information about republication or other use, please contact Ms. Stamer here.

 


SHOP Marketplace Still Health Coverage Option For Small Employers; All Employers Should Confirm Health Plan Compliance

May 10, 2017

While Congress continues to debate the future of the Obamacare health reforms and its exchanges, the Department of Health & Human Services is reminding employers with less than 50 employees that wish to offer group health coverage for their employees to check out their coverage options offered the Small Business Health Options Program (SHOP) Marketplace established as part of the Patient Protection and Affordable Care Act (ACA).  Before or when offering health coverage for employees or their dependents, employers and their management should confirm they fully understand and appropriately arrange for fulfillment of all applicable federal, contractual and other requirements to avoid unfortunate and often expensive liabilities.

The SHOP Marketplace is intended to offer an opportunity for for small employers who want to provide health and dental insurance to their employees.  Use of the SHOP Marketplace to obtain coverage may be an option for an employer if it is a business or non-profit organization with 50 or fewer full-time equivalent employees (FTEs).  An employer that qualifies to get group health coverage through the SHOP doesn’t have to wait for an annual enrollment period;  it can start offering SHOP insurance to your employees any time of year by completing the enrollment process by the applicable deadline prior to the first day of the month that the employer wants to start offering coverage through the SHOP.

In addition to the option to buy coverage through the SHOP, employers with 25 or fewer employees also may be eligible to use the Small Employer Health Care Credit created by the ACA to help defray the costs of providing this coverage to their qualifying employees.  For instance, Monday, May 15 is the sign up deadline for small employers and nonprofit employees interested in obtaining small group health plan coverage for their employees through the the SHOP Marketplace beginning on June 1. See HealthCare.gov/Small-Business to enroll your small business or non-profit employees or get more details.

While many excellent reasons may exist for a business to offer group health coverage for qualifying employees, all employers regardless of size considering offering group health coverage obtained through the SHOP or other sources should keep in mind that employers that establish and maintain group health coverage, the group health plans they establish and the company or persons with discretionary authority or responsibility for the maintenance, management or administration of these programs or their plans are required to comply with a variety of federal tax, labor and other rules.

Businesses and their owners or management leaders making these decisions should confirm that they fully understand these responsibilities and take appropriate steps to ensure their fulfillment before establishing or maintaining a group health plan to avoid exposing their business, its management or owners or others to unexpected and often substantial liabilities that can result from violation of these requirements.  While small employers plans sometimes qualify for some relief from a few of these requirements, depending on their size,  the majority of these federal rules apply to most if not all group health plans.  Furthermore, businesses sponsoring these programs and their leaders involved in deciding whether and what health coverage to offer for employees and their dependents should not presume that their organization, the resulting plan or its fiduciaries will fulfill these requirements simply by purchasing coverage through the SHOP Marketplace, directly from an insurer, or with the assistance of a broker or consultant.  Fulfillment of applicable requirements generally requires that sponsoring employers and individuals within the management responsible for or appointed to oversee the program to take other steps.  The scope of responsibility and resulting liability to a sponsoring employer and members of its ownership or management also typically are impacted by the plan design and contracts used to establish and maintain the program, its funding, and various other factors.  These factors generally include contractual language in insurance, consulting or brokerage, administrative services and other contracts presented by vendors for use in purchasing and maintaining the program that often shift responsibility for many duties an employer otherwise might assume would be born by the vendor.  For these and other reasons, most businesses and their leadership will want to consider arranging for their proposed program and its associated contracts  and arrangements to be reviewed by legal counsel experienced in group health plan and associated labor, tax and other laws and arrangements.

About The Author

Recognized by her peers as a Martindale-Hubble “AV-Preeminent” (Top 1%) and “Top Rated Lawyer” with special recognition LexisNexis® Martindale-Hubbell® as “LEGAL LEADER™ Texas Top Rated Lawyer” in Health Care Law and Labor and Employment Law; as among the “Best Lawyers In Dallas” for her work in the fields of “Labor & Employment,” “Tax: Erisa & Employee Benefits,” “Health Care” and “Business and Commercial Law” by D Magazine, Cynthia Marcotte Stamer is a practicing attorney board certified in labor and employment law by the Texas Board of Legal Specialization and management consultant, author, public policy advocate and lecturer widely known for work, teachings and publications.

Ms. Stamer works with businesses and their management, employee benefit plans, governments and other organizations deal with all aspects of human resources and workforce, internal controls and regulatory compliance, change management and other performance and operations management and compliance. Her day-to-day work encompasses both labor and employment issues, as well as independent contractor, outsourcing, employee leasing, management services and other nontraditional service relationships.  She supports her clients both on a real-time, “on demand” basis and with longer term basis to deal with all aspects for workforce and human resources management, including, recruitment, hiring, firing, compensation and benefits, promotion, discipline, compliance, trade secret and confidentiality, noncompetition, privacy and data security, safety, daily performance and operations management, emerging crises, strategic planning, process improvement and change management, investigations, defending litigation, audits, investigations or other enforcement challenges, government affairs and public policy.

Well-known for her extensive work with health, insurance, financial services, technology, energy, manufacturing, retail, hospitality and governmental employers, her nearly 30 years’ of experience encompasses domestic and international businesses of all types and sizes.

A Fellow in the American College of Employee Benefit Counsel, the American Bar Foundation and the Texas Bar Foundation, Ms. Stamer also shares her thought leadership, experience and advocacy on these and other concerns by her service in the leadership of a broad range of other professional and civic organization including her involvement as the Vice Chair of the North Texas Healthcare Compliance Association; Executive Director of the Coalition on Responsible Health Policy and its PROJECT COPE: Coalition on Patient Empowerment; former Board President of the early childhood development intervention agency, The Richardson Development Center for Children; former Gulf Coast TEGE Council Exempt Organization Coordinator; a founding Board Member and past President of the Alliance for Healthcare Excellence; former board member and Vice President of the Managed Care Association; past Board Member and Board Compliance Committee Chair for the National Kidney Foundation of North Texas; a member and advisor to the National Physicians’ Council for Healthcare Policy; current Vice Chair of the ABA Tort & Insurance Practice Section Employee Benefits Committee; current Vice Chair of Policy for the Life Sciences Committee of the ABA International Section; Past Chair of the ABA Health Law Section Managed Care & Insurance Section; a current Defined Contribution Plan Committee Co-Chair, former Group Chair and Co-Chair of the ABA RPTE Section Employee Benefits Group; immediate past RPTE Representative to ABA Joint Committee on Employee Benefits Council Representative and current RPTE Representative to the ABA Health Law Coordinating Council; past Chair of the Dallas Bar Association Employee Benefits & Executive Compensation Committee; a former member of the Board of Directors, Treasurer, Member and Continuing Education Chair of the Southwest Benefits Association and others.

Ms. Stamer also is a highly popular lecturer, symposia chair and author, who publishes and speaks extensively on human resources, labor and employment, employee benefits, compensation, occupational safety and health, and other regulatory and operational risk management.  Examples of her many highly regarded publications on these matters include the “Texas Payday Law” Chapter of Texas Employment Law, as well as thousands of other publications, programs and workshops these and other concerns for the American Bar Association, ALI-ABA, American Health Lawyers, Society of Human Resources Professionals, the Southwest Benefits Association, the Society of Employee Benefits Administrators, the American Law Institute, Lexis-Nexis, Atlantic Information Services, The Bureau of National Affairs (BNA), InsuranceThoughtLeaders.com, Benefits Magazine, Employee Benefit News, Texas CEO Magazine, HealthLeaders, the HCCA, ISSA, HIMSS, Modern Healthcare, Managed Healthcare, Institute of Internal Auditors, Society of CPAs, Business Insurance, Employee Benefits News, World At Work, Benefits Magazine, the Wall Street Journal, the Dallas Morning News, the Dallas Business Journal, the Houston Business Journal, and many other symposia and publications. She also has served as an Editorial Advisory Board Member for human resources, employee benefit and other management focused publications of BNA, HR.com, Employee Benefit News, InsuranceThoughtLeadership.com and many other prominent publications and speaks and conducts training for a broad range of professional organizations and for clients on the Advisory Boards of InsuranceThoughtLeadership.com, HR.com, Employee Benefit News, and many other publications.

Want to know more?  See here for details about the author of this update, attorney Cynthia Marcotte Stamer, e-mail her here or telephone Ms. Stamer at (469) 767-8872.

About Solutions Law Press, Inc.™

Solutions Law Press, Inc.™ provides human resources and employee benefit and other business risk management, legal compliance, management effectiveness and other coaching, tools and other resources, training and education on leadership, governance, human resources, employee benefits, data security and privacy, insurance, health care and other key compliance, risk management, internal controls and operational concerns. If you find this of interest, you also be interested reviewing some of our other Solutions Law Press, Inc.™ resources at SolutionsLawPress.com

If you or someone else you know would like to receive future updates about developments on these and other concerns, please provide your current contact information and preferences including your preferred e-mail by creating or updating your profile here.

NOTICE: These statements and materials are for general informational and purposes only. They do not establish an attorney-client relationship, are not legal advice, and do not serve as a substitute for legal advice. Readers are urged to engage competent legal counsel for consultation and representation in light of the specific facts and circumstances presented in their unique circumstance at any particular time. No comment or statement in this publication is to be construed as an admission. The author reserves the right to qualify or retract any of these statements at any time. Likewise, the content is not tailored to any particular situation and does not necessarily address all relevant issues. Because the law is rapidly evolving and rapidly evolving rules makes it highly likely that subsequent developments could impact the currency and completeness of this discussion. The presenter and the program sponsor disclaim, and have no responsibility to provide any update or otherwise notify any participant of any such change, limitation, or other condition that might affect the suitability of reliance upon these materials or information otherwise conveyed in connection with this program. Readers may not rely upon, are solely responsible for, and assume the risk and all liabilities resulting from their use of this publication.

Circular 230 Compliance. The following disclaimer is included to ensure that we comply with U.S. Treasury Department Regulations. Any statements contained herein are not intended or written by the writer to be used, and nothing contained herein can be used by you or any other person, for the purpose of (1) avoiding penalties that may be imposed under federal tax law, or (2) promoting, marketing or recommending to another party any tax-related transaction or matter addressed herein.

©2017 Cynthia Marcotte Stamer. Non-exclusive right to republish granted to Solutions Law Press, Inc.™ All other rights reserved.

 

 


Employers Review Health Plans Now To Avoid Excise Taxes & Other Current Law Plan Risks & Ready For Health Reform

April 25, 2017

While Congress and the Trump Administration continue to ponder and debate what if anything to do with the health care reforms of the Patient Protection and Affordable Care Act (ACA), employer and other health plan sponsors, health plan insurers, plan fiduciaries and others responsible for health plan design, administration or funding must take steps to verify their past and continuing compliance with the ACA and other federal mandates while laying the groundwork to respond quickly to any eventual reforms.

Regardless of what, if anything, the existing Congress or the Trump Administration does to repeal or reform the ACA or other federal health plan rules, all health plan sponsors, insurers, fiduciaries and administrators should act to mitigate their substantial and ever-growing health plan exposures by arranging for an independent compliance audit of their health plan terms, materials and operations for potential uncorrected past or current violations of the 40 federal mandates covered by the Form 8928 reporting and associated Internal Revenue Code excise tax liability exposure, as well as other applicable plan liabilities under the Employee Retirement Income Security Act (ERISA), the Social Security Act, the Internal Revenue Code and other federal laws within open statute of limitation periods.

The cost, complexity and riskiness of health plan sponsorship and administration has grown exponentially over the past two decades.  Thanks to the ACA and the continuous stream of other federal laws and regulations implemented over the past 20 years, sponsoring employers, as well as their health plans and those responsible as fiduciaries for administering, funding and insuring these programs now face huge costs, responsibilities and liabilities.  While the ACA substantially expanded the federal health plan mandates and liabilities, the ACA is not the lone cause and its amendment or repeal alone won’t fully resolve these risks prospectively or retrospectively insulate sponsoring employers, their plans or their fiduciaries and insurers from the liabilities and costs of compliance issues occurring before Congress repeals or amends the ACA.

Of particular note for employer and other sponsors of group health plans are the self-reporting and excise tax self-assessment and payment requirements for employers coupled with the companion responsibilities and liabilities fiduciaries, plan administrators and others face under these federal mandates make it important that employers and others sponsoring group health plans and their management or other leaders overseeing or participating in plan design or vendor selection, plan administration or other plan related activities get advice and help from qualified legal counsel experienced in health plan matters:

  • To conduct an independent compliance review and risk assessment of their health plans,
  • To recommend and assist in the performance of recommended steps to correct or mitigate risks from any potential past or existing violations or other exposures that have arisen or are likely to arise from existing contractual, plan design or other health plan actions;
  • To explore the potential advisability of taking additional steps to prevent or mitigate health plan associated compliance or other risks going forward whether or not health reform happens; and
  • To begin preparing to take advantage of any impending health care reforms by evaluating the requirements and procedures that existing plan terms, contracts, vendors and arrangements are likely to require to implement changes necessary to respond to any reforms as quickly and efficiently as possible.

Spring Clean Your Health Plan House

Since any reforms eventually enacted are unlikely to retroactively eliminate liability of employers, their health plans or fiduciaries for violations of federal health plan mandates, health plan terms, or associated contracts occurring before the effective date of reform, employer and other health plan sponsors, fiduciaries, insurers and administrators should begin by identifying,  cleaning up any existing, unresolved, and preventing any new health plan compliance problems.

While overall compliance with applicable federal mandates and health terms generally should be the goal, employers or others sponsoring group health plans need to be particularly concerned with their responsibilities and potential liability under the Internal Revenue Code to self-identify, report and pay stiff excise tax penalties of $100 per day per violation of any of 40 federal health plan mandates imposed by the ACA and various other federal laws when the sponsor files its annual tax return.

This employer or other plan sponsor excise tax liability generally arises in addition to the liabilities that plans, their fiduciaries and their insures face for failing to administer and pay benefits under the plans in accordance with the listed 40 federal mandates, whether actually written into or imputed by operation of law into the plan, the costs of which sponsoring employers often will bear responsibility for funding in whole or in part pursuant to their contractual liabilities under the health plan contracts, as plan fiduciaries or both.  See, Businesses Must Confirm & Clean Up Health Plan ACA & Other Compliance Following Supreme Court’s King v. Burwell Decision;  More Work For Employers, Benefit Plans Following SCOTUS Same-Sex Marriage Ruling; 2016 & 2017 Health Plan Budgets, Workplans Should Anticipate Expected Changes To SBCs. 

Sponsors and plan fiduciaries also need to be concerned about other risks beyond sponsoring employers’ excise tax liability exposures for sponsoring a non-compliant group health plan.  Among other things, group health plans and their fiduciaries can face audits, litigation and enforcement actions by the Centers for Medicare & Medicaid Services and other health plans for improperly coordinating plan claims with other coverage as well as lawsuits from covered persons, their health care providers or other beneficiaries, the Department of Labor and CMS, or others seeking to enforce rights to benefits, penalties in the case of CMS or the Department of Labor, and attorneys’ fees and other costs of enforcement. Beyond benefit litigation, the employer or representatives of the sponsoring employer, if any, named or acting as fiduciaries, insurer or third-party service providers named or acting as fiduciaries, also could face fiduciary lawsuits seeking damages, equitable relief, and attorneys’ fees and costs of court, for failing to prudently administer the plan in accordance with its terms and the law brought by covered persons or their beneficiaries or the DOL as well as fiduciary breach penalties if the fiduciary breach action is brought by the DOL. If the plan fails to comply with claims and appeals procedures or other ERISA notification requirements, parties named or functioning as the plan administrator for this purpose also could face penalties of up to $125 per violation per day in the case of enforcement actions brought by participants and beneficiaries or $1025 per violation per day in the case of actions brought by the DOL, plus attorneys’ fees and other costs of enforcement.  Unless the employer previously took steps to draft its health plan documents and negotiate its vendor contracts to provide otherwise, most vendor provided plans typically assign these liabilities to the sponsoring employer or a member of its management by naming that employer or the management person the “plan administrator” and/or “named fiduciary” responsible for those activities and liabilities, requiring the plan sponsor to indemnify the vendor for costs and liabilities arising from the performance of actions under the plan even when those actions don’t comply with ERISA fiduciary or other legal standards applicable to the performance of those duties under the plan, or both, and other contractual or plan provisions that shift liabilities and costs to the plan sponsor.

To mitigate their exposure to these liabilities and costs, employer or other health plan sponsors should consider arranging for an independent legal compliance and risk assessment of their health plan, its terms, materials and operations to help mitigate the sponsoring employer’s exposure to self-identify, self-report on IRS Form 2848 and pay the $100 per day per violation excise tax liability now generally required under the Internal Revenue Code for any such violation.

Beyond mitigating a plan sponsor’s Form 8928 reporting and associated excise tax exposures,  an independent compliance audit also can mitigate other risks and exposures for the sponsoring employer, the plan and its fiduciaries, the cost of which the sponsoring employer often bears financial responsibility for funding pursuant to the contractual indemnification and funding obligations entered into in connection with the establishment and maintenance of the plan, the fiduciary role, if any, of the employer with respect to the plan, or both.  Accordingly, a timely and appropriate review is likely to help mitigate other risks and liabilities such as:

  • Fiduciary liability that can arising from failing to administer the plan in accordance with these and other federal health plan mandates  under ERISA;
  • Unanticipated benefit costs and liabilities, which for self-insured plans are likely to be particularly burdensome if compliance issues are not identified and corrected before applicable deadlines to pay and submit claims to the stop-loss or other insurer expire (usually at or shortly after the close of a plan year or if earlier, contract termination);
  • Benefit costs and penalties for wrongful coordination of benefits with Medicare, Medicaid, DOD and certain other plans or coverage in violation of Secondary Payer and other mandates; and
  • Costs of defending and settling audits, litigation and other government or participant enforcement actions.

Since  prompt self-audit and correction can help mitigate all of these liabilities, business leaders of employers sponsoring health plans should act promptly to engage experienced legal counsel experienced with health plan laws and operations to advise the plan sponsor about how to audit their group health plan’s plan documents, materials and operations for compliance with these and other federal health plan rules within the scope of attorney-client privilege while managing tax, financial, benefit and fiduciary liability exposures to deal with potential compliance concerns that the review might discover as well as mitigate risks that could result if the audit is improperly structured or conducted.

Prepare To Respond To Potential Health Reform & Other Health Plan Improvement

Beyond identifying and addressing existing compliance concerns and other risks associated with prior or existing plan design or administration, most employer and other sponsors also will want to  review the health plan document and materials and associated insurance, third-party administration and other health plan vendor contracts pursuant to which the health plan is established, maintained and administered to identify requirements and opportunities to respond quickly to make changes when and if health care reform happens as well as for other opportunities to mitigate existing risks and costs.

As most commentators expect some type of regulatory or statutory health plan relief to result from the current health care reform debates in Congress, employer and other health plan sponsors desiring to accelerate their ability to take advantage of any forthcoming relief should familiarize themselves with the procedures required under existing plan terms, contracts and rules to modify their programs in response to these changes.  Almost certainly, plan sponsors should anticipate needing to adopt some amendments to plan documents, summary plan descriptions and other materials to take advantage of any legislative or statutory relief.  Plan sponsors also need to keep in mind that their vendor contracts with administrators, group, stop-loss or captive insurers, and other vendors likely also will require the plan sponsor to notify and negotiate with its vendors to secure their agreement before adopting these changes to avoid violating those vendor agreements and prudently to arrange for appropriate implementation and administration of the modified plan design and terms.  Identification of the contractual and plan requirements and commencement of discussions with the relevant vendors can help expedite the planning and implementation of any desired plan modifications the plan sponsor elects to make in response to any statutory or regulatory reforms.

While preparing for anticipated health care reforms, most plan sponsors also will want to review their plans and vendor contracts for other potential opportunities to mitigate risks or expenses.  With respect to existing and future liability mitigation, each plan sponsor generally should carefully assess the allocation of fiduciary responsibility and liability between the sponsoring employer, members of its management or other workforce team, and vendors to identify potential areas where the contract may assign named or other plan administrator or other fiduciary status and liability to the plan sponsor or a member of its workforce for duties outsourced to a vendor.   Sponsoring employers or their management may want to initiate negotiations with the vendor to reallocate the fiduciary role and responsibility to the party responsible for performance of the specific duties, enhancement of performance guarantees, indemnifications and insurance coverage for proper performance of the outsourced duties by the vendor in accordance with the plan terms, including any mandates imposed by the ACA and other federal laws in form and operation, and other safeguards or, if the vendor is unwilling to consider these changes, begin searching for a replacement vendor willing to provide better accountability for its actions with respect to the services it is hired to perform.

Except in rare circumstances where the sponsoring employer has carefully contracted to transfer fiduciary liability to its insurer or administrator and otherwise does not exercise or have a fiduciary obligation to exercise discretion or control over these responsibilities, employers sponsoring group health plans that violate federal mandates like the out-of-pocket limit often ultimately bear some or all of these liabilities even if the violation actually was committed by a plan vendor hired to administer the program either because the plan documents name the employer as the “named fiduciary” or “plan administrator” under ERISA, the employer or a member of its management named in the plan generally bears fiduciary responsibility functionally for selection or oversight of the culpable party, the employer signed a contract, resolution or plan document obligating the employer to indemnify the service provider for the liability, or a combination of these reasons.

Since prompt self-audit and correction can help mitigate all of these liabilities as well as help to preserve access to stop-loss or other reinsurance coverage, if any, applicable to help pay for some or all of any additional benefit liabilities resulting from these benefit mandates, business leaders of companies offering group health plan coverage should act quickly to engage experienced legal counsel for their companies for advice about how to audit their group health plan’s compliance with these and other federal health plan rules within the scope of attorney-client privilege while managing tax, financial, benefit and fiduciary liability exposures to deal with potential compliance concerns that the review might discover as well as mitigate risks that could result if the audit is improperly structured or conducted.

While businesses inevitably will need to involve or coordinate with their accounting, broker, and other vendors involved with the plans, businesses generally will want to get legal advice in a manner that preserves their potential to claim attorney-client privilege to protect against discovery in the event of future enforcement or litigation actions sensitive discussions and analysis about compliance audits, plan design choices, and other risk management and liability planning as well as to get help identifying potential plan design, contracting, procedural or other changes that may be needed to fix compliance deficiencies and mitigate other risks, particularly in light of complexity of the exposures and risks.

About The Author

Recognized by LexisNexis® Martindale-Hubbell® as a “AV-Preeminent” (Top 1%/ the highest) and “Top Rated Lawyer,” with special recognition as “LEGAL LEADER™ Texas Top Rated Lawyer” in Health Care Law and Labor and Employment Law; as among the “Best Lawyers In Dallas” for her work in the fields of “Health Care,” “Labor & Employment,” “Tax: Erisa & Employee Benefits” and “Business and Commercial Law” by D Magazine, the author of this update is widely known for her 29 plus years’ of work in health care, health benefit, health policy and regulatory affairs and other health industry concerns as a practicing attorney and management consultant, thought leader, author, public policy advocate and lecturer.

Throughout her adult life and nearly 30-year legal career, Ms. Stamer’s legal, management and governmental affairs work has focused on helping health and othre employee benefit, financial services, health care and other organizations and their management use the law, performance and risk management tools and process to manage people, performance, quality, compliance, operations and risk.

Highly valued for her rare ability to find pragmatic client-centric solutions by combining her detailed legal and operational knowledge and experience with her talent for creative problem-solving, Ms. Stamer supports these organizations and their leaders on both a real-time, “on demand” basis as well as outsourced operations or special counsel on an interim, special project, or ongoing basis with strategic planning and product and services development and innovation; workforce and operations management, crisis preparedness and response as well as to prevent, stabilize and cleanup legal and operational crises large and small that arise in the course of operations.

Throughout her career, she has helped a diverse array of clients manage, administer and defend employee and other workforce, vendors and suppliers, their recruitment, selection, performance management, contracting, investigation, discipline and termination; health and other employee benefits; compensation;  safety; governance; compliance and internal controls; strategic planning, process and quality improvement; change management; trade secret and other privacy, data security and data breach;; crisis preparedness and response; internal, government and third-party reporting relations, audits, investigations and enforcement; government affairs and public policy; and other compliance and risk management, government and regulatory affairs and operations concerns.

The American Bar Association (ABA) International Section Life Sciences Committee Vice Chair, a Scribe for the ABA Joint Committee on Employee Benefits (JCEB) Annual OCR Agency Meeting, former Vice President of the North Texas Health Care Compliance Professionals Association, past Chair of the ABA Health Law Section Managed Care & Insurance Section, past ABA JCEB Council Representative, past Board President of Richardson Development Center (now Warren Center) for Children Early Childhood Intervention Agency, past North Texas United Way Long Range Planning Committee Member, and past Board Member and Compliance Chair of the National Kidney Foundation of North Texas, Ms. Stamer has worked extensively throughout her career with employers, health and other employee benefit plans, insurers, managed care organizations, health care clearinghouses, health care providers, their business associates, employers, banks and other financial institutions, management services organizations, professional and trade associations, accreditation agencies, auditors, technology and other vendors and service providers, and others on benefit and insurance program legal and operational compliance, risk management,  public policies and regulatory affairs, contracting, payer-provider, provider-provider, vendor, patient, governmental and community relations and matters including extensive involvement advising, representing and defending plan sponsors, fiduciaries, service providers, managed care organizations, insurers, self-insured health plans and other payers. Her experience includes both leading edge work designing and administering programs, as well as defending clients in connection with audits and enforcement actions by OCR Privacy and Civil Rights, Department of Labor, IRS, HHS, DOD, FTC, SEC, CDC, OSHA, Department of Insurance, Department of Justice and state attorneys’ general and other federal and state agencies; accreditation and quality organizations; private litigation and other federal and state health care industry investigation, enforcement including insurance or other liability management and allocation; process and product development, contracting, deployment and defense; evaluation, commenting or seeking modification of regulatory guidance, and other regulatory and public policy advocacy; training and discipline; enforcement, and a host of other related concerns for public and private health care providers, health insurers, health plans, technology and other vendors, employers, and others.and other compliance, public policy, regulatory, staffing, and other operations and risk management concerns.

Past Chair of the ABA Managed Care & Insurance Interest Group and, a Fellow in the American College of Employee Benefit Counsel, the American Bar Foundation and the Texas Bar Foundation, Ms. Stamer also has extensive health care reimbursement and insurance experience advising and defending health care providers, payers, and others about Medicare, Medicaid, Medicare and Medicaid Advantage, Tri-Care, self-insured group, association, individual and group and other health benefit programs and coverages including but not limited to advising public and private payers about coverage and program design and documentation, advising and defending providers, payers and systems and billing services entities about systems and process design, audits, and other processes; provider credentialing, and contracting; providers and payer billing, reimbursement, claims audits, denials and appeals, coverage coordination, reporting, direct contracting, False Claims Act, Medicare & Medicaid, ERISA, state Prompt Pay, out-of-network and other nonpar insured, and other health care claims, prepayment, post-payment and other coverage, claims denials, appeals, billing and fraud investigations and actions and other reimbursement and payment related investigation, enforcement, litigation and actions.

Heavily involved in health care and health information technology, data and related process and systems development, policy and operations innovation and a Scribe for ABA JCEB annual agency meeting with OCR for many years who has authored numerous highly-regarded works and training programs on HIPAA and other data security, privacy and use, Ms. Stamer also is widely recognized for her extensive work and leadership on leading edge health care and benefit policy and operational issues including meaningful use and EMR, billing and reimbursement, quality measurement and reimbursement, HIPAA, FACTA, PCI, trade secret, physician and other medical confidentiality and privacy, federal and state data security and data breach and other information privacy and data security rules and many other concerns. Her work includes both regulatory and public policy advocacy and thought leadership, as well as advising and representing a broad range of health industry and other clients about policy design, drafting, administration, business associate and other contracting, risk assessments, audits and other risk prevention and mitigation, investigation, reporting, mitigation and resolution of known or suspected violations or other incidents and responding to and defending investigations or other actions by plaintiffs, DOJ, OCR, FTC, state attorneys’ general and other federal or state agencies, other business partners, patients and others.

A lead policy advisor to the Government of Bolivia on its pension privitization project and involved in U.S. federal and state as well as cross border workforce, pension, health care, Social Security, immigration, and tax regulatory and statutory reform throughout her adult life, Ms. Stamer also is widely sought out for her thoughtleadership and assistance with domestic and international public policy concerns in Pensions, healthcare, workforce, immigration, tax, education and other areas.

A popular lecturer and widely published author on health industry concerns, Ms. Stamer continuously advises health industry clients about compliance and internal controls, workforce and medical staff performance, quality, governance, reimbursement, privacy and data security, and other risk management and operational matters. Ms. Stamer also publishes and speaks extensively on health and managed care industry regulatory, staffing and human resources, compensation and benefits, technology, public policy, reimbursement and other operations and risk management concerns.

A Fellow in the American College of Employee Benefit Counsel, the American Bar Foundation and the Texas Bar Foundation, Ms. Stamer also shares her thought leadership, experience and advocacy on these and other related concerns by her service in the leadership of the Solutions Law Press, Inc. Coalition for Responsible Health Policy, its PROJECT COPE: Coalition on Patient Empowerment, and a broad range of other professional and civic organizations including North Texas Healthcare Compliance Association, a founding Board Member and past President of the Alliance for Healthcare Excellence, past Board Member and Board Compliance Committee Chair for the National Kidney Foundation of North Texas; former Board President of the early childhood development intervention agency, The Richardson Development Center for Children (now Warren Center For Children); current Vice Chair of the ABA Tort & Insurance Practice Section Employee Benefits Committee, current Vice Chair of Policy for the Life Sciences Committee of the ABA International Section, Past Chair of the ABA Health Law Section Managed Care & Insurance Section, a current Defined Contribution Plan Committee Co-Chair, former Group Chair and Co-Chair of the ABA RPTE Section Employee Benefits Group, past Representative and chair of various committees of ABA Joint Committee on Employee Benefits; a ABA Health Law Coordinating Council representative, former Coordinator and a Vice-Chair of the Gulf Coast TEGE Council TE Division, past Chair of the Dallas Bar Association Employee Benefits & Executive Compensation Committee, a former member of the Board of Directors of the Southwest Benefits Association and others.

Ms. Stamer also is a highly popular lecturer, symposium and chair, faculty member and author, who publishes and speaks extensively on health and managed care industry, human resources, employment and other privacy, data security and other technology, regulatory and operational risk management for the American Bar Association, ALI-ABA, American Health Lawyers, Society of Human Resources Professionals, the Southwest Benefits Association, the Society of Employee Benefits Administrators, the American Law Institute, Lexis-Nexis, Atlantic Information Services, The Bureau of National Affairs (BNA), InsuranceThoughtLeaders.com, Benefits Magazine, Employee Benefit News, Texas CEO Magazine, HealthLeaders, the HCCA, ISSA, HIMSS, Modern Healthcare, Managed Healthcare, Institute of Internal Auditors, Society of CPAs, Business Insurance, Employee Benefits News, World At Work, Benefits Magazine, the Wall Street Journal, the Dallas Morning News, the Dallas Business Journal, the Houston Business Journal, and many other symposia and publications. She also has served as an Editorial Advisory Board Member for human resources, employee benefit and other management focused publications of BNA, HR.com, Employee Benefit News, Insurance Thought Leadership and many other prominent publications and speaks and conducts training for a broad range of professional organizations.

For more information about Ms. Stamer or her experience and involvements, see here or contact Ms. Stamer via telephone at (469) 767-8872 or via e-mail here.

About Solutions Law Press, Inc.™

Solutions Law Press, Inc.™ provides human resources and employee benefit and other business risk management, legal compliance, management effectiveness and other coaching, tools and other resources, training and education on leadership, governance, human resources, employee benefits, data security and privacy, insurance, health care and other key compliance, risk management, internal controls and operational concerns. If you find this of interest, you also be interested reviewing some of our other Solutions Law Press, Inc.™ resources at www.solutionslawpress.com.

If you or someone else you know would like to receive future updates about developments on these and other concerns, please be sure that we have your current contact information including your preferred e-mail by creating your profile here.

©2017 Cynthia Marcotte Stamer. Non-exclusive right to republish granted to Solutions Law Press, Inc.™ All other rights reserved. For information about republication or other use, please contact Ms. Stamer here.

 

If you or someone else you know would like to receive future updates about developments on these and other concerns, please be sure that we have your current contact information including your preferred e-mail by creating or updating your profile here.

©2017 Cynthia Marcotte Stamer. Non-exclusive right to republish granted to Solutions Law Press, Inc.™. All other rights reserved.


Latest HIPAA Resolution Agreement Drives Home Importance Of Maintaining Current, Signed Business Associate Agreements

April 24, 2017

Health plans, their fiduciaries and sponsors, health insurers, health care providers, health care clearinghouses (“covered entities”) and their business associates must get and keep your business associate (BA) agreements (BAAs) in place, up-to-date, and readily available for inspection in accordance with the Health Insurance Portability & Accountability Act (HIPAA) Privacy Rule, 45 C.F.R. Part 160 and Subparts A and E of Part 164 (Privacy Rule).  That’s the clear message to covered entities and their business associates in the April 17, 2017 HIPAA Resolution Agreement just announced by the Department of Health & Human Services (HHS) Office of Civil Rights (OCR) with the Center for Children’s Digestive Health (CCDH).

While the Resolution Agreement relates to breaches of the BAA requirements of a small pediatric practice, all health plans, health care providers and other covered entities and business associates should focus on the adequacy of their BAAs  and their BAA record keeping.  HIPAA compliance surveys reflect deficiencies with the BAA rules are common throughout the industry.  These findings and the involvement of BAs in data breaches or other OCR enforcement activities suggest a high probability that many other covered entities and business associates may be sitting ducks for similar sanctions.  See e.g., HIPAA Compliance Survey Churns Up Many Business Associate Problems (January 3, 2017).  Consequently, all covered entities and business associates generally should treat the CCDH Resolution Agreement as a message to review and correct as necessary their organizations’ compliance and recordkeeping to minimize their exposure to potential sanctions from violations of the HIPAA business associate rules.

The HIPAA Business Associate Agreement Requirements

OCR’s announcement of the CCDH Resolution Agreement is the latest in a growing series of HIPAA enforcement actions showing the growing risk covered entities and their business associates face for failing to take appropriate steps to comply with the BAA and other Privacy Rule requirements of HIPAA.

As compliance audits and surveys of covered entities and business associates suggest a high level of noncompliance with the business associate agreement requirements among covered entities and business associates, While the ever-growing list of Resolution Agreements and Civil Monetary Penalties announced by OCR cover a variety of categories of HIPAA violations, the CCDH Resolution Agreement highlights the importance of covered entities and their business associates ensuring that before the BA creates, accesses, receives, discloses, retains or destroys any PHI for the covered entity,  a BAA meeting the Privacy Rule requirements is signed and retained for at least the six-year period the Privacy Rule requires in a manner easily producible when and if OCR or another agency asks for a copy as part of an investigation or other compliance audit.  See Privacy Rule §§ 164.502(e), 164.504(e), 164.532(d) and (e).

The Privacy Rule requires that covered entities and business associates enter into a written and signed business associate agreement that contains the elements specified in Privacy Rule § 164.504(e) before the business associate creates, uses, accesses or discloses PHI of the covered entity. Meanwhile, the Privacy Rule recordkeeping requirements require that covered entities and BAs maintain copies of these BAAs for a minimum of six years.

Violations of the Privacy Rule can carry stiff civil or even criminal penalties  Pursuant to amendments to HIPAA enacted as part of the HITECH Act, civil penalties typically do not apply to violations punished under the criminal penalty rules of HIPAA set forth in Social Security Act , 42 U.S.C § 1320d-6 (Section 1177).

Under Section 1177, the criminal enforcement provisions of HIPAA authorize the Justice Department to prosecute a person who knowingly in violation of the Privacy Rule (1) uses or causes to be used a unique health identifier; (2) obtains individually identifiable health information relating to an individual; or (3) discloses individually identifiable health information to another person, punishable by the following criminal sanctions and penalties:

  • A fine of up to $50,000, imprisoned not more than 1 year, or both;
  • If the offense is committed under false pretenses, a fine of up to $100,000, imprisonment of not more than 5 years, or both; and
  • If the offense is committed with intent to sell, transfer, or use individually identifiable health information for commercial advantage, personal gain, or malicious harm, a fine of up to $250,000, imprisoned not more than 10 years, or both.

In contrast, as amended by the HITECH Act, the civil enforcement provisions of HIPAA empower OCR to impose Civil Monetary Penalties on both covered entities and BAs for violations of any of the requirements of the Privacy or Security Rules.  The penalty ranges for civil violations depends upon the circumstances associated with the violations and are subject to upward adjustment for inflation.  As most recently adjusted here effective September 6, 2016,  the following currently are the progressively increasing Civil Monetary Penalty tiers:

  • A minimum penalty of $100 and a maximum penalty of $50,000 per violation, for violations which the CE or BA “did not know, and by exercising reasonable diligence would not have known” about using “the business care and prudence expected from a person seeking to satisfy a legal requirement under similar circumstances;”
  • A minimum penalty of $1,000 and a maximum penalty of $50,000 per violation, for violations for “reasonable cause” which do not rise to the level of “willful neglect” where “reasonable cause” means the “circumstances that would make it unreasonable for the covered entity, despite the exercise of ordinary business care and prudence, to comply with the violated Privacy Rule requirement;”
  • A minimum penalty of $10,000 and a maximum penalty of $50,000 per violation, for violations attributed to “willful neglect,” defined as “the conscious, intentional failure or reckless indifference to the obligation to comply” with the requirement or prohibition; and
  • A minimum penalty of $50,000 and a maximum penalty of $1.5 million per violation, for violations attributed to “willful neglect” not remedied within 30 days of the date that the covered entity or BA knew or should have known of the violation.

For continuing violations such as failing to implement a required BAA, OCR can treat each day  of noncompliance as a separate violation.  However, sanctions under each of these tiers generally are subject to a maximum penalty of $1,500,000 for violations of identical requirements or prohibitions during a calendar year.  For violations such as the failure to implement and maintain a required BAA where more than one covered entity bears responsibility for the violation, OCR an impose Civil Monetary Penalties against each culpable party. OCR considers a variety of mitigating and aggravating facts and circumstances when arriving at the amount of the penalty within each of these applicable tiers to impose.

While criminal enforcement of HIPAA remains relatively rare, a review of the OCR enforcement record in recent years makes clear that civil enforcement of HIPAA and the sanctions imposed is growing. See e.g.,  $400K HIPAA Settlement Shows Need To Conduct Timely & Appropriate Risk Assessments$5.5M Memorial HIPAA Resolution Agreement Shows Need To Audit.  For more examples, also see here.

CCDH Sanctions For Violation Of HIPAA Business Associate Agreement Rules

The CCDH Resolution Agreement arises from violations of this requirement that OCR says it discovered as a result of a compliance review conducted in response to an OCR investigation of a CCDH business associate, FileFax, Inc.  According to OCR, OCR found from the compliance review of CCDH triggered by OCR’s investigation of FileFax that while CCDH began disclosing PHI to Filefax in 2003 and that Filefax stored records containing protected health information (PHI) for CCDH, neither CCDH nor Filefax could produce a signed Business Associate Agreement (BAA) covering their relationship for any period before October 12, 2015.

Based on the resulting investigation,  OCR concluded:

  • CCDH failed to obtain a BAA providing written assurances from Filefax that it would appropriately safeguard the PHI in Filefax’s possession or control satisfactory assurances as required by Privacy Rule §164.502(e); and
  • Because CCDH failed to secure the required BAA, it violated the Privacy Rule by impermissibly disclosing the PHI of at least 10,728 individuals to Filefax when CCDH transferred the PHI to Filefax without obtaining the requisite BAA from Filefax (Covered Conduct).

In the Resolution Agreement, CCDH agrees to pay HHS $31,000.00 (Resolution Amount) and enter into and comply with a Corrective Action Plan (CAP) in return for OCR’s release of CCDH from liability for “any actions it may have against CCDH under the HIPAA Rules” for the Covered Conduct.  The Resolution Agreement only settles the civil monetary penalty and other OCR enforcement liabilities of CCDH with respect to the Covered Conduct.  Its provisions expressly state the Resolution Agreement does not affect any exposures of CCDH to CCDH to OCR civil monetary penalties or other enforcement for any HIPAA violations other than the Covered Conduct.

Perhaps even more noteworthy given the HITECH Act’s provisions coordinating the civil and criminal sanctions of HIPAA, while  the Resolution Agreement provides no clear indication that the Justice Department might be considering criminally prosecuting CCDH or any other party in relation to the Covered Conduct, the Resolution Agreement also expressly states that its provisions do not affect CCDH’s potential exposure, if any, to criminal prosecution by the Justice Department for a criminal violation of the Privacy Rules under Section 1177 of the Social Security Act.

Implications For Covered Entities & Business Associates

Covered entities and their business associates should heed the CCDH Resolution Agreement as a strong message from OCR to ensure their organizations are complying with HIPAA’s BAA and other requirements.  The Resolution Agreement makes clear that the starting point of this compliance effort must be obtaining and maintaining the requisite BAAs for each BA relationship.

To position their organizations to withstand potential investigation by OCR, covered entities and BAs should start by conducting a well-documented audit within the scope of attorney-client privilege both to verify that an appropriate, signed BAA is in place for each BA relationship as well as adequacy of processes for identifying business associate relationships, ensuring that signed BAAs are in effect before BAs access any PHI, and for investigating, reporting and resolving any breaches of the HIPAA Privacy or Security Rules that may arise in the course of operations.

Conducting this audit as soon as possible is particularly important in light of reported findings of widespread compliance concerns. See HIPAA Compliance Survey Churns Up Many Business Associate Problems (January 3, 2017).  As the audit process could identify potential violations or other legally sensitive concerns,  covered entities and business associates generally will want to arrange for this audit and evaluation to be conducted under the supervision of legal counsel experienced with HIPAA within or pursuant to processes structured with the assistance of legal counsel within the scope of attorney-client privilege.

Beyond confirming all necessary BAAs are in place, covered entities and business associates also generally will want to evaluate the adequacy of BAs’ processes and procedures for maintaining compliance with the Privacy and Security Rules as well as processes and procedures for responding to audits, investigations and complaints, reporting and addressing breaches of electronic and other PHI and other possible compliance concerns under HIPAA and other related laws.  In many instances, parties may n wish to revise and strengthen existing BAAs to more specifically define these policies and procedures more specifically as well as indemnification, cyber or other liability coverage requirements and other contractual provisions for allocating potential costs and liabilities arising from breaches, audits, investigations and other expenses associated with the administration of these provisions.

About The Author

Recognized by LexisNexis® Martindale-Hubbell® as a “AV-Preeminent” (Top 1%/ the highest) and “Top Rated Lawyer,” with special recognition as “LEGAL LEADER™ Texas Top Rated Lawyer” in Health Care Law and Labor and Employment Law; as among the “Best Lawyers In Dallas” for her work in the fields of “Health Care,” “Labor & Employment,” “Tax: Erisa & Employee Benefits” and “Business and Commercial Law” by D Magazine, the author of this update is widely known for her 29 plus years’ of work in health care, health benefit, health policy and regulatory affairs and other health industry concerns as a practicing attorney and management consultant, thought leader, author, public policy advocate and lecturer.

Throughout her adult life and nearly 30-year legal career, Ms. Stamer’s legal, management and governmental affairs work has focused on helping health industry, health benefit and other organizations and their management use the law, performance and risk management tools and process to manage people, performance, quality, compliance, operations and risk. Highly valued for her rare ability to find pragmatic client-centric solutions by combining her detailed legal and operational knowledge and experience with her talent for creative problem-solving, Ms. Stamer supports these organizations and their leaders on both a real-time, “on demand” basis as well as outsourced operations or special counsel on an interim, special project, or ongoing basis with strategic planning and product and services development and innovation; workforce and operations management, crisis preparedness and response as well as to prevent, stabilize and cleanup legal and operational crises large and small that arise in the course of operations.

As a core component of her work, Ms. Stamer has worked extensively throughout her career with health care providers, health plans and insurers, managed care organizations, health care clearinghouses, their business associates, employers, banks and other financial institutions, management services organizations, professional associations, medical staffs, accreditation agencies, auditors, technology and other vendors and service providers, and others on legal and operational compliance, risk management and compliance, public policies and regulatory affairs, contracting, payer-provider, provider-provider, vendor, patient, governmental and community relations and matters including extensive involvement advising, representing and defending public and private hospitals and health care systems; physicians, physician organizations and medical staffs; specialty clinics and pharmacies; skilled nursing, home health, rehabilitation and other health care providers and facilities; medical staff, accreditation, peer review and quality committees and organizations; billing and management services organizations; consultants; investors; technology, billing and reimbursement and other services and product vendors; products and solutions consultants and developers; investors; managed care organizations, insurers, self-insured health plans and other payers; and other health industry clients to manage and defend compliance, public policy, regulatory, staffing and other operations and risk management concerns. A core focus of this work includes work to establish and administer compliance and risk management policies; comply with requirements, investigate and respond to Board of Medicine, Health, Nursing, Pharmacy, Chiropractic, and other licensing agencies, Department of Aging & Disability, FDA, Drug Enforcement Agency, OCR Privacy and Civil Rights, Department of Labor, IRS, HHS, DOD, FTC, SEC, CDC and other public health, Department of Justice and state attorneys’ general and other federal and state agencies; dealings with JCHO and other accreditation and quality organizations; investigation and defense of private litigation and other federal and state health care industry investigations and enforcement; insurance or other liability management and allocation; process and product development; managed care, physician and other staffing, business associate and other contracting; evaluation, commenting or seeking modification of regulatory guidance, and other regulatory and public policy advocacy; training and discipline; and a host of other related concerns for public and private health care providers, health insurers, health plans, technology and other vendors, employers, and others.

In the course of this work, Ms. Stamer has accumulated extensive experience helping health industry clients manage workforce, medical staff, vendors and suppliers, medical billing, reimbursement, claims and other provider-payer relations, business partners, and their recruitment, performance, discipline, compliance, safety, compensation, benefits, and training, board, medical staff and other governance; compliance and internal controls; strategic planning, process and quality improvement; change management; assess, deter, investigate and address staffing, quality, compliance and other performance; meaningful use, EMR, HIPAA and other data security and breach and other health IT and data; crisis preparedness and response; internal, government and third-party reporting, audits, investigations and enforcement; government affairs and public policy; and other compliance and risk management, government and regulatory affairs and operations concerns.

Author of leading works on HIPAA and other privacy and data security works and the scribe leading the American Bar Association Joint Committee on Employee Benefits Annual Agency Meeting with OCR, her experience includes extensive compliance, risk management and data breach and other crisis event investigation, response and remediation under HIPAA and other laws.

The American Bar Association (ABA) International Section Life Sciences Committee Vice Chair, a Scribe for the ABA Joint Committee on Employee Benefits (JCEB) Annual OCR Agency Meeting, former Vice President of the North Texas Health Care Compliance Professionals Association, past Chair of the ABA Health Law Section Managed Care & Insurance Section, past ABA JCEB Council Representative, past Board President of Richardson Development Center (now Warren Center) for Children Early Childhood Intervention Agency, past North Texas United Way Long Range Planning Committee Member, and past Board Member and Compliance Chair of the National Kidney Foundation of North Texas, Ms. Stamer has worked closely with a diverse range of physicians, hospitals and healthcare systems, DME, Pharma, clinics, health care providers, managed care, insurance and other health care payers, quality assurance, credentialing, technical, research, public and private social and community organizations, and other health industry organizations and their management deal with governance; credentialing, patient relations and care; staffing, peer review, human resources and workforce performance management; outsourcing; internal controls and regulatory compliance; billing and reimbursement; physician, employment, vendor, managed care, government and other contracting; business transactions; grants; tax-exemption and not-for-profit; licensure and accreditation; vendor selection and management; privacy and data security; training; risk and change management; regulatory affairs and public policy and other concerns.

Past Chair of the ABA Managed Care & Insurance Interest Group and, a Fellow in the American College of Employee Benefit Counsel, the American Bar Foundation and the Texas Bar Foundation, Ms. Stamer also has extensive health care reimbursement and insurance experience advising and defending health care providers, payers, and others about Medicare, Medicaid, Medicare and Medicaid Advantage, Tri-Care, self-insured group, association, individual and group and other health benefit programs and coverages including but not limited to advising public and private payers about coverage and program design and documentation, advising and defending providers, payers and systems and billing services entities about systems and process design, audits, and other processes; provider credentialing, and contracting; providers and payer billing, reimbursement, claims audits, denials and appeals, coverage coordination, reporting, direct contracting, False Claims Act, Medicare & Medicaid, ERISA, state Prompt Pay, out-of-network and other nonpar, insured, and other health care claims, prepayment, post-payment and other coverage, claims denials, appeals, billing and fraud investigations and actions and other reimbursement and payment related investigation, enforcement, litigation and actions.

Heavily involved in health care and health information technology, data and related process and systems development, policy and operations innovation and a Scribe for ABA JCEB annual agency meeting with OCR for many years who has authored numerous highly-regarded works and training programs on HIPAA and other data security, privacy and use, Ms. Stamer also is widely recognized for her extensive work and leadership on leading edge health care and benefit policy and operational issues including meaningful use and EMR, billing and reimbursement, quality measurement and reimbursement, HIPAA, FACTA, PCI, trade secret, physician and other medical confidentiality and privacy, federal and state data security and data breach and other information privacy and data security rules and many other concerns.

In connection with this work, Ms. Stamer has worked extensively with health care providers, health plans, health care clearinghouses, their business associates, employers and other plan sponsors, banks and other financial institutions, and others on risk management and compliance with HIPAA, FACTA, trade secret and other information privacy and data security rules, including the establishment, documentation, implementation, audit and enforcement of policies, procedures, systems and safeguards, investigating and responding to known or suspected breaches, defending investigations or other actions by plaintiffs, OCR and other federal or state agencies, reporting known or suspected violations, business associate and other contracting, commenting or obtaining other clarification of guidance, training and and enforcement, and a host of other related concerns. Her clients include public and private health care providers, health insurers, health plans, technology and other vendors, and others.

Her work includes both regulatory and public policy advocacy and thought leadership, as well as advising and representing a broad range of health industry and other clients about policy design, drafting, administration, business associate and other contracting, risk assessments, audits and other risk prevention and mitigation, investigation, reporting, mitigation and resolution of known or suspected violations or other incidents and responding to and defending investigations or other actions by plaintiffs, DOJ, OCR, FTC, state attorneys’ general and other federal or state agencies, other business partners, patients and others.

In addition to representing and advising these organizations, she also has conducted training on Privacy & The Pandemic for the Association of State & Territorial Health Plans, as well as HIPAA, FACTA, PCI, medical confidentiality, insurance confidentiality and other privacy and data security compliance and risk management for Los Angeles County Health Department, MGMA, ISSA, HIMMS, the ABA, SHRM, schools, medical societies, government and private health care and health plan organizations, their business associates, trade associations and others.

A former lead consultant to the Government of Bolivia on its Pension Privatization Project with extensive domestic and international public policy concerns in Pensions, healthcare, workforce, immigration, tax, education and other areas.

A popular lecturer and widely published author on health industry concerns, Ms. Stamer continuously advises health industry clients about compliance and internal controls, workforce and medical staff performance, quality, governance, reimbursement, privacy and data security, and other risk management and operational matters. Ms. Stamer also publishes and speaks extensively on health and managed care industry regulatory, staffing and human resources, compensation and benefits, technology, public policy, reimbursement and other operations and risk management concerns.

A Fellow in the American College of Employee Benefit Counsel, the American Bar Foundation and the Texas Bar Foundation, Ms. Stamer also shares her thought leadership, experience and advocacy on these and other related concerns by her service in the leadership of the Solutions Law Press, Inc. Coalition for Responsible Health Policy, its PROJECT COPE: Coalition on Patient Empowerment, and a broad range of other professional and civic organizations including North Texas Healthcare Compliance Association, a founding Board Member and past President of the Alliance for Healthcare Excellence, past Board Member and Board Compliance Committee Chair for the National Kidney Foundation of North Texas; former Board President of the early childhood development intervention agency, The Richardson Development Center for Children (now Warren Center For Children); current Vice Chair of the ABA Tort & Insurance Practice Section Employee Benefits Committee, current Vice Chair of Policy for the Life Sciences Committee of the ABA International Section, Past Chair of the ABA Health Law Section Managed Care & Insurance Section, a current Defined Contribution Plan Committee Co-Chair, former Group Chair and Co-Chair of the ABA RPTE Section Employee Benefits Group, past Representative and chair of various committees of ABA Joint Committee on Employee Benefits; a ABA Health Law Coordinating Council representative, former Coordinator and a Vice-Chair of the Gulf Coast TEGE Council TE Division, past Chair of the Dallas Bar Association Employee Benefits & Executive Compensation Committee, a former member of the Board of Directors of the Southwest Benefits Association and others.

Ms. Stamer also is a highly popular lecturer, symposium and chair, faculty member and author, who publishes and speaks extensively on health and managed care industry, human resources, employment and other privacy, data security and other technology, regulatory and operational risk management. Examples of her many highly regarded publications on these matters include “Protecting & Using Patient Data In Disease Management: Opportunities, Liabilities And Prescriptions,” “Privacy Invasions of Medical Care-An Emerging Perspective,” “Cybercrime and Identity Theft: Health Information Security: Beyond HIPAA,” as well as thousands of other publications, programs and workshops these and other concerns for the American Bar Association, ALI-ABA, American Health Lawyers, Society of Human Resources Professionals, the Southwest Benefits Association, the Society of Employee Benefits Administrators, the American Law Institute, Lexis-Nexis, Atlantic Information Services, The Bureau of National Affairs (BNA), InsuranceThoughtLeaders.com, Benefits Magazine, Employee Benefit News, Texas CEO Magazine, HealthLeaders, the HCCA, ISSA, HIMSS, Modern Healthcare, Managed Healthcare, Institute of Internal Auditors, Society of CPAs, Business Insurance, Employee Benefits News, World At Work, Benefits Magazine, the Wall Street Journal, the Dallas Morning News, the Dallas Business Journal, the Houston Business Journal, and many other symposia and publications. She also has served as an Editorial Advisory Board Member for human resources, employee benefit and other management focused publications of BNA, HR.com, Employee Benefit News, Insurance Thought Leadership and many other prominent publications and speaks and conducts training for a broad range of professional organizations.

For more information about Ms. Stamer or her health industry and other experience and involvements, see here or contact Ms. Stamer via telephone at (469) 767-8872 or via e-mail here.

About Solutions Law Press, Inc.™

Solutions Law Press, Inc.™ provides human resources and employee benefit and other business risk management, legal compliance, management effectiveness and other coaching, tools and other resources, training and education on leadership, governance, human resources, employee benefits, data security and privacy, insurance, health care and other key compliance, risk management, internal controls and operational concerns. If you find this of interest, you also be interested reviewing some of our other Solutions Law Press, Inc.™ resources here.

If you or someone else you know would like to receive future updates about developments on these and other concerns, please be sure that we have your current contact information including your preferred e-mail by creating your profile here.

©2017 Cynthia Marcotte Stamer. Non-exclusive right to republish granted to Solutions Law Press, Inc.™ All other rights reserved. For information about republication or other use, please contact Ms. Stamer here.


Consider Access In Prudent Investment Broker Selection

April 19, 2017

https://videopress.com/embed/3futNZyv?hd=0&autoPlay=0&permalink=0&loop=0
If you or someone else you know would like to receive future updates about developments on these and other concerns, please be sure that we have your current contact information including your preferred e-mail by creating or updating your profile here.©2017. Cynthia Marcotte Stamer. Non-exclusive right to republish granted to Solutions Law Press, Inc. All other rights reserved.


Health Reform:  Tell Congress Until It Listens

April 19, 2017

https://videopress.com/embed/MqUiaSs1?hd=0&autoPlay=0&permalink=0&loop=0

If you or someone else you know would like to receive future updates about developments on these and other concerns, please be sure that we have your current contact information including your preferred e-mail by creating or updating your profile here.

©2017. Cynthia Marcotte Stamer. Non-exclusive right to republish granted to Solutions Law Press, Inc. All other rights reserved.



Tell Congress Pass AHCA Today

May 4, 2017

The US House of Representatives is scheduled to vote again tonight on the revised Majority-leadership lead first step healthcare reform legislation seeking to provide Americans and American business with some initial relief from the soaring premium and health care costs, care access barriers and regulatory and other burdens that have resulted under the ObamaCare law and regulations. Every American should call, e-mail or fax the leaders and their Congressperson as soon as possible today and tell them to pass this legislation and get busy passing the next set of reforms with no further delay, the get and stay II formed and involved until it gets it done starting with the House hearing and vote slated tonight starting at 8:30 Eastern. Get details here.

Health care and its reform is a complex challenge. Americans and American businesses, health payers, and States and their healthcare needs are highly diverse. The ambitious but far from successful Obamacare law shows the dangers of well-meaning but unrealistic To try to fix these challenges with a sweeping, one shot fix.  

While passage of this legislative package won’t magically fix these challenges, it will provide quick relief for some of the ObamaCare expense and restrictions and expand the choices that Americans, American business, payers, providers and States while Congress works with American to identify and pursue legislative, regulatory, marketplace and other improvements. 

Let’s get things going in the right direction!