HIPAA compliance promotes strong security, especially given the increase in data breaches recently. According to reports, the total number of individuals affected by healthcare data breaches from 2005 to 2019 was 249.09 million. Of these, 157.4 million individuals were impacted in the last five years alone. New data also shows that healthcare data breaches exposed 170 million records in 2024.
The reason for a healthcare data breach is the value of patients’ data to cybercriminals. A complete record file of a single patient can fetch hundreds of dollars on the dark web. Moreover, research notes that healthcare organizations typically lack the cybersecurity needed to safeguard themselves.
The high value of records and neglected security, coupled with the increasing frequency and magnitude of healthcare data breaches, highlights the urgent need for improved data confidentiality measures in the healthcare industry.
A data breach is when sensitive, protected, or confidential data is accessed, disclosed, or stolen by unauthorized individuals. Common examples of breaches that result in exposed PHI include unauthorized employee access, lost or stolen devices, hacking incidents, and phishing/ransomware attacks. The two most widespread types of healthcare breaches are hacking/IT incidents and unauthorized internal disclosures.
Hacking attacks aim at gaining unauthorized access to confidential healthcare data. They can include malware, ransomware, phishing, and the exploitation of unpatched systems. They have been the leading cause of healthcare data breaches, accounting for the most exposed records.
Unauthorized internal disclosures occur when employees inappropriately access or disclose PHI. These breaches can result from privilege abuse, unauthenticated access or disclosure, improper disposal of sensitive data, or unintentional sharing of confidential information with unauthorized parties. Beyond these two types, other well-known breaches at healthcare organizations include:
No matter the type of breach, a data breach can have far-reaching consequences and serious responsibilities and accountabilities for a healthcare organization.
A HIPAA violation occurs when a healthcare organization does not maintain appropriate safeguards to prevent the intentional or unintentional use or disclosure of PHI. Whether deliberate or accidental, HIPAA violations can result in costly liabilities for healthcare providers and their business associates.
Fees issued by OCR for HIPAA violations can be severe, ranging from fines of $127 to $63,973 per violation, with an annual maximum of $1.9 million for repeated violations. Certain breaches might entail significant financial and criminal consequences compared to violations. In cases of willful neglect or criminal intent, the penalties can be even more severe, including fines of up to $500,000 and/or imprisonment for up to 10 years.
Beyond the direct financial costs of a data breach, healthcare organizations face a variety of other liabilities, from service disruptions to lost revenue, increased insurance premiums, and the daunting task of rebuilding patient trust and organizational reputation. Furthermore, disrupted operations, postponed surgeries, and closed emergency departments have direct impacts on patient care and patient outcomes.
Discover more: HITECH Act Enforcement Interim Final Rule
After a breach, patients can submit complaints directly to OCR (an online Complaint Portal Assistant helps to speed up the process) or state attorneys general. In most cases, the complaints are investigated. Action may be taken against the organization if the complaint is substantiated and if HIPAA rules have been violated.
Patients can also take direct legal action against healthcare organizations, either individually or through a class-action lawsuit. Affected individuals can sue healthcare organizations for damage resulting from PHI breaches, including emotional distress, identity theft, and financial losses. Under the HIPAA Act, however, it is not possible for a patient to directly sue for a HIPAA violation.
Rather, damages need to be settled for state law violations. Healthcare organizations can be held legally liable under state laws for several reasons:
Patients need to prove that harm or damage has been suffered, which is why joining a class-action lawsuit strengthens the case against a healthcare organization. Class-action lawsuits can result in substantial settlements or judgments against the offending organization.
Avoiding data breaches, HIPAA violations, and resulting liabilities is possible with HIPAA compliance because of HIPAA’s insistence on strict control of patients’ PHI. A strong cybersecurity strategy helps healthcare organizations meet regulatory requirements and avoid legal consequences and significant fines. Here's a list of what healthcare organizations can do to avoid costly penalties and focus on compliance.
Cybersecurity shields PHI from breaches and unauthorized access, which is central to maintaining patient privacy and confidentiality. By taking a proactive approach to cybersecurity, healthcare organizations can mitigate the risk of cyberattacks and protect sensitive patient data. Even if a breach occurs, strong cybersecurity protocols can detect an intrusion quickly, minimize the damage, expedite recovery, and help healthcare organizations avoid liabilities.
Healthcare organizations can access resources such as guidance documents and toolkits provided by HHS, as well as industry associations and professional organizations specializing in healthcare compliance and privacy. Additionally, consulting with legal experts and compliance professionals can provide valuable insights and assistance in maintaining compliance with HIPAA regulations.
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The HIPAA Act is a U.S. law designed to protect sensitive patient health information from being disclosed without the patient's consent or knowledge. HIPAA's Security Rule requires healthcare organizations to implement administrative, physical, and technical safeguards to ensure the confidentiality, integrity, and availability of ePHI.
Identifying a HIPAA breach involves recognizing any unauthorized acquisition, access, use, or disclosure of PHI that compromises its security or privacy. Monitoring access logs, conducting regular security assessments, and promptly investigating any suspicious incidents are necessary steps in identifying potential breaches. Early detection enables prompt action to mitigate harm and fulfill reporting requirements under HIPAA regulations.
Healthcare organizations can reduce the risk of data breaches by implementing strong cybersecurity measures, conducting regular security training for employees, and using encryption to protect sensitive data.
Upon discovering a data breach, a healthcare organization should contain the breach, assess the scope of the impact, notify affected individuals and relevant authorities, and begin an investigation to understand how the breach occurred and how to prevent future incidents.
Yes, legal action can result from a data breach, as affected individuals or organizations may sue for damages caused by the breach.