Organizations face HIPAA liability when they don’t have the right safeguards, training, or oversight in place and a breach happens. Individual healthcare professionals can be on the hook if they access, share, or mishandle patient information, whether on purpose or by carelessness. In short, the system gets blamed for gaps, but people are responsible for their own mistakes.
Organizations and individuals can face both civil and criminal consequences if they violate the Privacy and Security Rules, with the Office for Civil Rights (OCR) and the Department of Justice keeping a close eye. Civil fines scale with how much someone knew and how quickly they acted: honest mistakes cost $100–$50,000 per incident, issues caused by reasonable carelessness hit $1,000–$50,000, willful neglect that’s fixed is $10,000–$50,000, and uncorrected willful neglect maxes out at $50,000 per violation, capped at $1.5 million a year.
Criminal charges come into play when someone intentionally misuses patient data. Disclosing protected health information (PHI) wrongly can bring up to a $50,000 fine and a year in prison, while selling or harming patients’ information can carry $250,000 in fines and ten years behind bars. As one HIPAA Compliance review notes, “The Security Rule is designed to be flexible and scalable so a covered entity can implement policies, procedures, and technologies that are appropriate for the entity’s particular size, organizational structure, and risk to consumers’ ePHI,”
These rules apply to healthcare providers, insurers, clearinghouses, and even individual employees or officers. OCR investigations often lead to corrective action plans, resolution agreements, or exclusion from Medicare participation. With breaches affecting over 176 million patients, most are caused by employee mistakes, which makes training, audits, and strong compliance programs non-negotiable.
Healthcare organizations hold the ultimate responsibility for protecting patient information. If policies, safeguards, or training are lacking, organizations can be hit with serious penalties, think lost or unencrypted laptops, improperly disposed records, or systemic policy gaps. HIPAA enforcement actions continue to target organizations for these kinds of failures.
For example, in April 2025, the OCR announced a $600,000 settlement with PIH Health, Inc. after a phishing attack compromised nearly 190,000 individuals’ ePHI; OCR found the network had inadequate safeguards and workforce training, contributing to violations of the Privacy, Security, and Breach Notification Rules.
That same month, OCR also settled with Northeast Radiology, P.C., over a potential Security Rule violation. OCR fines can be steep, especially for repeated or uncorrected violations, reaching up to $1.5 million annually. Criminal charges are on the table if PHI is knowingly misused for profit. Most breaches happen from inside the organization, not hackers, making vigilance and policies the best defense.
Individuals can be personally liable if they access, share, or mishandle PHI, whether through negligence or intentional wrongdoing. Serious violations can carry fines up to $250,000 and ten years in prison, and even those who help or enable violations can be held accountable.
High-profile cases show how real the stakes are. For example, a Massachusetts physician was convicted of a criminal HIPAA violation for giving a pharmaceutical sales representative improper access to patient records over an extended period, while a former patient information coordinator was indicted for wrongfully obtaining and disclosing PHI for over a hundred patients without authorization.
Professionals must stick to the ‘minimum necessary’ rule, get proper authorizations, and report any breaches immediately. Routine mistakes, leaving charts unattended or posting patient details online, can trigger investigations and even job loss. In research or consultations, PHI must be de-identified or used with consent, and covered professionals submitting electronic claims are directly accountable, with HHS able to exclude violators from Medicare.
Liability under HIPAA often overlaps when an individual healthcare professional’s actions intersect with gaps in organizational safeguards. As a Chapter on the U.S. Health Insurance Portability and Accountability Act (HIPAA) emphasizes that covered entities, “healthcare providers, insurers, and other organizations handling patient data.” For example, routine mistakes, like accessing the wrong patient record, sending PHI to the wrong recipient, or failing to follow established procedures, can trigger both personal and organizational accountability.
The organization is responsible because it must ensure proper policies, training, and technical safeguards are in place, while the individual is directly accountable for their own conduct. In practice, a single lapse can implicate both parties: the employee’s error exposes PHI, and the organization’s failure to prevent or catch it magnifies the liability.
See also: HIPAA Compliant Email: The Definitive Guide (2025 Update)
Yes, organizations are vicariously liable for their workforce’s HIPAA violations when errors occur within the scope of employment.
Yes, employees can face fines, corrective actions, and criminal charges for negligent or intentional mishandling of PHI.
HITECH strengthens liability by requiring breach notifications and maintaining audit trails, exposing both organizations and individuals.