HIPAA Omnibus Rule Released

On January 17th, the Department of Health and Human Services final changes to the HIPAA Privacy and Security Rules, and the Interim Final Data Breach Rule were released for publication to the Federal Register. The final step in these long awaited changes to the Rules. Summarized here are some key points about the Omnibus Rule due to be published next week. Please contact RISC Management if your organization would be interested in a private webinar reviewing these changes in detail.

Effective date: This final rule is effective on March 26, 2013

Compliance date: Covered entities and business associates must be in accordance with the applicable requirements of this final rule by September 23, 2013

Summary of Major Provisions:

The omnibus final rule constitutes the following four final rules:

1. Final modifications to the HIPAA Privacy, Security, and Enforcement Rules mandated by the Health Information Technology for Economic and Clinical Health (HITECH) Act, and certain other modifications to improve the Rules, which were issued as a proposed rule on July 14, 2010. These modifications:

Make business associates of covered entities directly liable for compliance with certain of the HIPAA Privacy and Security Rules’ requirements.
Strengthen the limitations on the use and disclosure of protected health information for marketing and fundraising purposes, and prohibit the sale of protected health information without individual authorization.
Expand individuals’ rights to receive electronic copies of their health information and to restrict disclosures to a health plan concerning treatment for which the individual has paid out of pocket in full.
Require modifications to, and redistribution of, a covered entity’s notice of privacy practices.
Modify the individual authorization and other requirements to facilitate research and disclosure of child immunization proof to schools, and to enable access to decedent information by family members or others.
Adopt the additional HITECH Act enhancements to the Enforcement Rule not previously adopted in the October 30, 2009, interim final rule (referenced immediately below), such as the provisions addressing enforcement of noncompliance with the HIPAA Rules due to willful neglect.

2. Final rule adopting changes to the HIPAA Enforcement Rule to incorporate the increased and tiered civil money penalty structure provided by the HITECH Act, originally published as an interim final rule on October 30, 2009.

3. Final rule on Breach Notification for Unsecured Protected Health Information under the HITECH Act, which replaces the breach notification rule’s “harm” threshold with a more objective standard and supplants an interim final rule published on August 24, 2009.

4. Final rule modifying the HIPAA Privacy Rule as required by the Genetic Information Nondiscrimination Act (GINA) to prohibit most health plans from using or disclosing genetic information for underwriting purposes, which was published as a proposed rule on October 7, 2009” (https://s3.amazonaws.com/public-inspection.federalregister.gov/2013-01073.pdf, pp. 4-5).

In this final rule the Department finalizes the modifications to the HIPAA Privacy, Security, and Enforcement Rules to implement many of the privacy, security, and enforcement provisions of the HITECH Act and make other changes to the Rules; modifies the Breach Notification Rule; finalizes the modifications to the HIPAA Privacy Rule to strengthen privacy protections for genetic information; and responds to the public comments received on the proposed and interim final rules. Section III below describes the effective and compliance dates of the final rule. Section IV describes the changes to the HIPAA Privacy, Security, and Enforcement Rules under the HITECH Act and other modifications that were proposed in July 2010, as well as the modifications to the Enforcement Rule under the HITECH Act that were addressed in the interim final rule published in October 2009. Section V describes the changes to the Breach Notification Rule. Section VI discusses the changes to the HIPAA Privacy Rule to strengthen privacy protections for genetic information

The Rules also:

Clarify when breaches must be reported to HHS’ Office for Civil Rights;
Establish new standards for the use of patient-identifiable information for fundraising and marketing;
Expand liability to “business associates” of hospitals and other “HIPAA-covered entities,” such as data miners and health IT service providers
Raise the maximum penalty for noncompliance to $1.5 million per violation
Strengthen the privacy and security protections established under the Health Insurance Portability and Accountability of 1996 Act (HIPAA) for individual’s health information maintained in electronic health records and other formats
Increase flexibility for, and decrease burden on, the regulated entities, as well as to harmonize certain requirements with those under the Department’s Human Subjects Protections regulations

According to HHS, the rules stemmed in part from an executive order that directed HHS to conduct a retrospective review of existing regulations to determine ways to reduce costs and increase flexibility under HIPAA (Government Health IT, 1/17).

HHS Secretary Kathleen Sebelius said the rules “will help protect patient privacy and safeguard patients’ health information in an ever expanding digital age.”

While everyone should take note, Business Associates must really sit up and take notice. BAs are now primarily responsible to many of the same requirements as Covered Entities, and so are the Contractors of Business Associates. This is the time to evaluate the security and privacy controls around your contractors and offshore resources.

Business Associate Agreements – If you don’t have a current Business Associate Agreement in place that meets all of the current requirements of HIPAA and HITECH, Hurry! If there’s a compliant BAA in force before January 25th, you have 18 months to get an updated BAA in place. Otherwise, an updated BAA must be in place by September 23rd, 2013.

Notice of Privacy Practices (NPP) – All Covered Entities will need to update their NPP by September 23rd, 2013.

Contact RISC Management to see how we can help.