Office Compliance

The New HIPAA Omnibus Ruleby Karson L. Carpenter, D.D.S.

The Omnibus Final Rule was released by the Department of Health and Human Services on January 17, 2013. It was designed to strengthen the privacy and security protections offered under the Health Insurance Portability and Accountability Act of 1996 (HIPAA). This rule enhances patient’s privacy protections, provides individuals new rights to their health information, and strengthens the government’s ability to enforce the law. Here is a summary of this, the latest amendment to the HIPAA regulations. All covered entities must be in compliance with its provisions as of September 23, 2013.

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1. Notice of Privacy Practices (NPP)• Doctors/Offices must amend their NPPs to reflect the changes set forth below; Notice of Privacy has to be made available upon request on or after September 23, 2013 to any patient requesting a copy. Additionally, the revised Notice of Privacy has to be posted on the office website, if applicable, and in a prominent location on its premises. New patients who receive treatment for the first time after the modification should be provided a copy of the revised Notice of Privacy. Providers should retain copies of previous versions of the Notice of Privacy as well as any written acknowledgements by patients of receipt of Notice of Privacy.

2. Downstream Responsibility for Business Associates• Providers are not required to enter into Business Associate Agreement with all downstream contractors. They must sign a Business Associate Agreement with the entity with which they do business directly. Providers’ Business Associates are then required to get written “satisfactory assurances” from each of their immediate subcontractors. In the event of a breach, all “downstream contractors” are required to report up the chain to providers.• Business Associates and their subcontractors will need to implement a HIPAA Privacy and Security program if they do not have one.• Business Associates are not permitted to use or disclose Protected Health Information if it would be a HIPAA Privacy Rule violation for a Covered Entity to do so. All disclosures must be in accordance with the Business

Associate Agreement.• Even if a Business Associate Agreement is not yet in place, liability begins immediately when a person “creates, receives, maintains, or transmits Protected Health Information on behalf of a Covered Entity.• Business Associates are liable under HITECH for uses and disclosure that violate the HIPAA Privacy Rule or are in breach of the Business Associate contract. Business Associates are now directly liable under the HIPAA Rules for (1) impermissible uses and disclosures; (2) failure to provide breach notification to the Covered Entity; (3) failure to provide access to Electronic Protected Health Information to either the individual or the Covered Entity; (4) failure to provide requested Protected Health Information to HHS; (5) failure to provide an accounting of disclosures and; (6) not complying with the HIPAA Security Rule.• Business Associates and their subcontractors are now subject to criminal and civil sanctions for HIPAA violations to the same extent as Covered Entities.• Business Associates are required to have Business Associate Agreements with their subcontractors that access or use Protected Health Information on their behalf, and to monitor these Business Associate Agreements.

3. Individual Rights• At the patient’s request, providers may not disclose information about care the patient has paid for out-of-pocket to health plans, unless for treatment purposes or in the rare event the disclosure is required by law. This change updates the

previous HIPAA Privacy Rule governing patient requests for restrictions on the use or disclosure of their PHI • The Omnibus Rule expands this requirement so that it applies to Personal Health Information (PHI) maintained electronically in one or more designated record sets. Access to such PHI must be provided by the covered entity in the electronic form and format requested by the individual (if readily producible) or (if not readily producible) in a readable electronic form and format as agreed to by the covered entity and the individual. If no agreement can be reached as to electronic format, the covered entity must provide a hard copy of the information.

4. Marketing Communications• The new rules limit when health care providers can provide marketing communications to their patients without written authorization. The only time a health care provider may tell a patient about a third party product or service without the patient’s written authorization is when; (1) the provider receives no compensation for the communication; (2) the communication is face-to-face; (3) the communication is regarding a drug or biologic the patient has been prescribed and the cost is only a “reasonable” amount for the

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communication costs; (4) it is a general communication rather than the promotion of a specific product or service; (5) the communication involves a government sponsored program.

5. Emailing of Protected Health Information• The new rule clarifies that health care providers must send PHI via secure encrypted email systems. Unencrypted emails may only be sent if they are sent to the individual patient, they are advised of the risk of unencrypted emails, and they still request that form of transmission.

6. Charges for Copies of e-PHI or PHI• The new rules have modified the charges that may be made to individuals for their PHI to include labor costs and materials cost (paper, USB stick, CD, DVD, etc.). The only exception would be if state law in a particular state sets a lower cost.

7. Breach Notification• The obligation to notify patients if there is a breach of their PHI is expanded and clarified under the new rules. Breaches are now presumed reportable unless, after completing a risk analysis applying four factors, it is determined, that there is a “low probability of PHI compromise.” • To determine if the risk is sufficiently low, the following must be taken into account; (1) the nature and extent of the PHI involved—how sensitive was the information and can it be re-identified; (2) the identity of the person who used the PHI and those to whom the disclosure was made—do they have an independent obligation to protect the confidentiality

of the information; (3) whether the PHI was actually acquired or reviewed—need to conduct an analysis; (4) the extent to which the risk has been mitigated—such as by obtaining a confidentiality agreement from the recipient.• The new rule clarifies that there is no need to have an independent entity conduct the risk assessment

8. Childhood Immunizations• Under the new rules, physicians may disclose immunizations to schools required to obtain proof of immunization prior to admitting the student so long as the physicians have and document the patient or patient’s legal representative’s “informal agreement” to the disclosure.

9. Decedents• The new rules allow physicians to make relevant disclosures to the deceased’s family and friends under essentially the same circumstances such disclosures were permitted when the patient was alive; that is, when these individuals were involved in providing care or payment for care and the physician is unaware of any expressed preference to the contrary. The new rule also eliminates any HIPAA protection for PHI 50 years after a patient’s death.

10. Enforcement and Penalties• The new rule clarifies the following penalty tiers; (A) Lowest tier in which the health care provider did not or could not reasonably know of the breach; (B) Intermediate tier in which the health care provider knew, or by exercising reasonable diligence would have known” of the violation, but yet they did not act with willful neglect; (C) Highest tiers, which are cases in which the health care provider “acted with willful neglect” and either corrected the problem within the 30-day period, or failed to make a timely correction. • HHS is required to conduct a formal investigation and impose civil penalties in cases involving willful neglect. Penalties may be as high as 1.5 million dollars per violation.

As business owners who create and maintain protected health information, dentists must comply with all aspects of the HIPAA regulations including the new Omnibus Rule. By doing so you will not only protect your patient’s right to privacy, but protect your practice from the considerable financial penalties that could have devastating consequences for your practice.

Karson L. Carpenter practices dentistry in Farmington Hills, MI and currently serves as President and CEO of Compliance Training Partners. He is a graduate of the University of Michigan School of Dentistry, and since 1987 has designed educational programs to bring dental and medical facilities into compliance with governmental regulations.

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Office Compliance

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