User:Shawndouglas/sandbox/sublevel4

Title: HIPAA Compliance: An Introduction

Author for citation: Alan Vaughan, with editorial modifications by Shawn Douglas

License for content: Creative Commons Attribution-ShareAlike 4.0 International

Publication date: Originally published June 2016; lightly edited February 2022

Introduction

Reason and scope

In the U.S. healthcare industry, there are two main regulatory laws: the Clinical Laboratory Improvement Amendments of 1988 (CLIA) and the Health Information Portability and Accountability Act of 1996 (HIPAA). The first is aimed at clinical laboratories and the second applies to the vast majority of healthcare settings. This training guide is aimed at providing some accurate and useful training to those required to comply with HIPAA. Indeed, HIPAA training is mandated in the law itself, particularly by the United States Department of Health and Human Services (HHS), which summarizes that responsibility as such:

Workforce members include employees, volunteers, trainees, and may also include other persons whose conduct is under the direct control of the [covered] entity (whether or not they are paid by the entity). A covered entity must train all workforce members on its privacy policies and procedures, as necessary and appropriate for them to carry out their functions. A covered entity must have and apply appropriate sanctions against workforce members who violate its privacy policies and procedures or the Privacy Rule.

Anyone involved in healthcare has probably already realized that while their own entity's policies and procedures may well be in compliance, there is still a great deal of misunderstanding out there regarding HIPAA, as well as a general lack of knowledge of it beyond those measures that are in place where they happen to work. And it is also a matter of concern that industry professionals have encountered an alarming number of courses and guides purporting to provide an acceptable level of training, yet they prove to be significantly lacking in scope, clarity and in some cases accuracy.

This training guide is designed to provide a substantive, reasonably comprehensive understanding of all of the aspects of HIPAA that have bearing on most healthcare industry professionals. It is based almost completely on first-hand materials from the HHS (which the law charges with administration of HIPAA) and the actual Health Information and Portability Act of 1996 (HIPAA) law itself, rather than relying on secondary and tertiary interpretations and paraphrasing. However, these resources do not and cannot provide every detail for all scenarios. As such, several third-party sources were taken into account to gather and present the fullest comprehension of the materials and their relevance for the covered entities HIPAA affects.

Goals of this guide

The primary aim of this training guide is to supplement the requirement for HIPAA training as described above. Whether used to fulfill that directive, or as source for your own research, it is designed to provide the most comprehensive, clear and accurate general familiarity with HIPAA possible as it relates to those attempting to be compliant.

What is HIPAA?

The healthcare industry must comply with both CLIA and HIPAA. CLIA regulatory standards apply to all clinical laboratory testing performed on humans in the United States, except clinical trials and basic research. While important, this guide focuses on HIPAA, which was enacted by the United States Congress and signed into law in 1996.

Whereas CLIA involves standards in clinical testing, HIPAA is concerned with rigorously and effectively protecting patients’ personal information. It applies to most any entity that handles a patient's personal information, including contractors and other business associates.

Privacy and security

There are two main areas of HIPAA regulations and standards: privacy and security. Both apply to all covered entities and are related, but have slightly different emphases.

• HIPAA privacy (the Privacy Rule): This concentrates on the patient's right to privacy regarding their personal information and health records, and what covered entities must do to support that. It also includes their right to access those data.

• HIPAA security (the Security Rule): This portion of HIPAA focuses on the requirements for covered entities to protect patient data, including administrative, physical and technical ways and means.

Government oversight

When laws are made, the responsibility to make affected parties aware of their obligations and how to meet them—and to monitor, enforce and punish offenders—is often allocated to a particular body. In the case of HIPAA, the HHS is that body. Within the HHS, the Office for Civil Rights (OCR) ensures equal access to certain health and human services and protects the privacy and security of health information. Additionally, the Centers for Disease Control and Prevention (CDC) and other HHS agencies provide additional guidance and materials.

Further information about HIPAA and its history, etc. can be found on the LIMSwiki Health Insurance Portability and Accountability Act page.

Who needs to comply?

HIPAA compliance is highly important in the healthcare arena. Non-compliance can result in fines and other serious consequences. But who is actually bound by this law? HIPAA is comprised of two main segments: the Privacy Rule and the Security Rule. Those who must comply are called "covered entities." According to the HHS, these include:

▪ health plans;

▪ healthcare clearinghouses; and

▪ any healthcare provider who transmits health information in electronic form in connection with a transaction for which the Secretary of HHS has adopted standards under HIPAA.

Covered entities include doctors, clinics, hospitals, dentists, nursing homes and pharmacies that transmit data electronically, as well as health plans, insurance plans and healthcare clearinghouses.

Healthcare providers

Every healthcare provider (regardless of size) who electronically transmits health information in connection with certain transactions is a covered entity. These transactions include:

• claims
• benefit eligibility inquiries
• referral authorization requests
• other transactions for which HHS has established standards under the HIPAA Transactions Rule

It's important to note that using electronic technology (e.g., email) does not mean a healthcare provider is a covered entity. The transmission must be in connection with a "standard transaction."

Transactions are electronic exchanges involving the transfer of information between two parties for specific purposes. For example, a healthcare provider will send a claim to a health plan to request payment for medical services.

In the HIPAA regulations, the Secretary of Health and Human Services adopted certain standard transactions for electronic data interchange (EDI) of healthcare data. These transactions include:

• claims and encounter information
• payment and remittance advice
• claims status
• eligibility, enrollment and disenrollment
• referrals and authorizations
• coordination of benefits and premium payment

The standard does not encompass telephone voice response and fax-back systems.

The Privacy Rule covers a healthcare provider whether it electronically transmits these transactions directly or uses a billing service or other third party to do so on its behalf. Healthcare providers include all “providers of services” (e.g., institutional providers such as hospitals) and “providers of medical or health services” (e.g., non-institutional providers such as physicians, dentists and other practitioners) as defined by Medicare, and any other person or organization that furnishes, bills, or is paid for healthcare.

Business associates

Healthcare providers don't always do everything that involves patient information themselves. There are very often other entities contracted for a variety of services. As a result of the Health Information Technology for Economic and Clinical Health Act (HITECH) that was passed in 2009, HIPAA has also been expanded to include business associates. Business associates are those persons or organizations that function on behalf of a covered entity, such as a doctor, and who either use or receive identifiable health information.

According to 45 CFR 160 Part 103, business associate functions or activities on behalf of a covered entity include:

• claims processing
• data analysis
• utilization review
• billing
• legal services
• actuarial services
• accounting
• consulting
• data aggregation
• management
• administrative services
• accreditation
• financial services

A business associate is also anyone—not just those in the workforce of the covered entity—who performs any activities for a covered entity that are covered by HIPAA. Consider that an "...and all other related" kind of clause. Subcontractors of business associates who fit these criteria are also subject to HIPAA.

However, persons or organizations are not considered business associates if their functions or services do not involve the use or disclosure of protected health information, and where any access to protected health information by such persons would be incidental, if at all. A covered entity can also be the business associate of another covered entity.

Here are some examples of business associates, as described by the HHS :

• third party administrator who assists a health plan with claims processing
• CPA firm whose accounting services to a healthcare provider involve access to protected health information
• attorney whose legal services to a health plan involve access to protected health information
• consultant who performs utilization reviews for a hospital
• healthcare clearinghouse that translates a claim from a non-standard format into a standard transaction on behalf of a healthcare provider and forwards the processed transaction to a payer
• independent medical transcriptionist who provides transcription services to a physician
• pharmacy benefits manager who manages a health plan’s pharmacist network

Business associate agreement (BAA)

According to the HHS, "A covered entity’s contract or other written arrangement with its business associate must contain the elements specified at 45 CFR 164.504(e)." Provisions need to:

• describe the permitted and required uses of protected health information by the business associate;
• provide that the business associate will not use or further disclose the protected health information (PHI) other than as permitted or required by the contract or as required by law; and
• require the business associate to use appropriate safeguards to prevent a use or disclosure of the protected health information other than as provided for by the contract.

Where a covered entity (the party who has contracted the BA) knows of a material breach or violation by the business associate of the contract or agreement, the covered entity is required to take reasonable steps to cure the breach or end the violation, and if such steps are unsuccessful, to terminate the contract or arrangement. If termination of the contract or agreement is not feasible, a covered entity is required to report the problem to the HHS Office for Civil Rights (OCR).

HHS provides a useful sample BAA] on its website for reference.

Exceptions to BAA requirement

There are exceptions to the requirement for a covered entity to have a BAA with a business associate before protected health information may be disclosed to the person or entity. Per 45 CFR 164.502(e), the Privacy Rule includes the following exceptions to the business associate standard:

1. disclosures by a covered entity to a healthcare provider for treatment of the individual. For example:
   1. A hospital is not required to have a business associate contract with the specialist to whom it refers a patient and transmits the patient’s medical chart for treatment purposes.
   2. A physician is not required to have a business associate contract with a laboratory as a condition of disclosing protected health information for the treatment of an individual.
   3. A hospital laboratory is not required to have a business associate contract to disclose protected health information to a reference laboratory for treatment of the individual.
2. disclosures to a health plan sponsor, such as an employer, by a group health plan, or by the health insurance issuer or HMO that provides the health insurance benefits or coverage for the group health plan, provided that the group health plan’s documents have been amended to limit the disclosures or one of the exceptions at 45 CFR 164.504(f) have been met.
3. the collection and sharing of protected health information by a health plan that is a public benefits program, such as Medicare, and an agency other than the agency administering the health plan, such as the Social Security Administration, that collects protected health information to determine eligibility or enrollment, or determines eligibility or enrollment, for the government program, where the joint activities are authorized by law.

Other situations in which a business associate contract is NOT required

Some additional scenarios where a BAA is not necessary include:

• when a healthcare provider discloses protected health information to a health plan for payment purposes, or when the healthcare provider simply accepts a discounted rate to participate in the health plan’s network. A provider that submits a claim to a health plan and a health plan that assesses and pays the claim are each acting on its own behalf as a covered entity, and not as the “business associate” of the other.
• with persons or organizations (e.g., janitorial service or electrician) whose functions or services do not involve the use or disclosure of protected health information, and where any access to protected health information by such persons would be incidental, if at all.
• where a person or organization acts merely as a conduit for protected health information, for example the U.S. Postal Service, certain private couriers and their electronic equivalents.
• covered entities who participate in an Organized Healthcare Arrangement (OHCA) to make disclosures that relate to the joint healthcare activities of the OHCA.
• when a group health plan purchases insurance from a health insurance issuer or HMO. The relationship between the group health plan and the health insurance issuer or HMO is defined by the Privacy Rule as an OHCA, with respect to the individuals they jointly serve or have served. Thus, these covered entities are permitted to share protected health information that relates to the joint healthcare activities of the OHCA.
• where one covered entity purchases a health plan product or other insurance, for example, reinsurance, from an insurer. Each entity is acting on its own behalf when the covered entity purchases the insurance benefits, and when the covered entity submits a claim to the insurer and the insurer pays the claim.
• the disclosure of protected health information to a researcher for research purposes, either with patient authorization, pursuant to a waiver under 45 CFR 164.512(i), or as a limited data set pursuant to 45 CFR 164.514(e). Because the researcher is not conducting a function or activity regulated by the Administrative Simplification Rules, such as payment or healthcare operations, or providing one of the services listed in the definition of “business associate” at 45 CFR 160.103, the researcher is not a business associate of the covered entity, and no business associate agreement is required.
• when a financial institution processes consumer-conducted financial transactions by debit, credit, or other payment card, clears checks, initiates or processes electronic funds transfers, or conducts any other activity that directly facilitates or effects the transfer of funds for payment for healthcare or health plan premiums. When it conducts these activities, the financial institution is providing its normal banking or other financial transaction services to its customers; it is not performing a function or activity for, or on behalf of, the covered entity.

Others (plans, etc.)

The other categories of "covered entities" who are subject to the requirements of HIPAA include health plans and healthcare clearinghouses.

Health plans

Whether individual or group, health plans that provide or pay the cost of healthcare, dental care, vision care, and prescription drug costs are covered entities under HIPAA. This includes health maintenance organizations (HMOs); Medicare, Medicaid, Medicare+Choice and Medicare supplement insurers; and long-term care insurers (excluding nursing home fixed-indemnity policies).

Covered entity health plans can be employer-sponsored group health plans, government- and church-sponsored health plans or multi-employer health plans.

Health plan exceptions

The exceptions where certain health plans do not constitute covered entities include:

1. group health plans with less than 50 participants, administered solely by the employer that established and maintains the plan.
2. two types of government-funded programs:
   1. those whose principal purpose is not providing or paying the cost of healthcare, such as the food stamps program (SNAP).
   2. those programs whose principal activity is directly providing healthcare, such as a community health center, or the making of grants to fund the direct provision of healthcare.
3. certain types of insurance entities, particularly those who only provide:
   1. workers’ compensation.
   2. automobile insurance.
   3. property and casualty insurance.

However, if an insurance entity has more than one line of business, one of which may be identified separately as a health plan, then HIPAA regulations do apply to the health plan line of business.

Healthcare clearinghouses

Health care clearinghouses are entities that process nonstandard information they receive from another entity into a standard (i.e., standard format or data content), or vice versa.

In most instances, healthcare clearinghouses will receive individually-identifiable health information only when they are providing these processing services to a health plan or healthcare provider as a Business Associate. In those cases, only certain provisions of the Privacy Rule are applicable to uses and disclosures of protected health information.

Healthcare clearinghouses include:

• billing services
• repricing companies
• community health management information systems
• value-added networks and switches (if they perform clearinghouse functions)

Protected health information

At the center of all of HIPAA and HITECH is a single term and its definition: protected health information or PHI. This is the information that can be linked to a patient and has been identified by the U.S. government as being private to a patient. As such, PH is protected by both the Privacy Rule and Security Rule of HIPAA, as well as HITECH (for electronic PHI). These protections exist so that unauthorized sharing is prevented or at least minimized, and access is controlled, with significant sanctions and measures available to be applied in the even of breaches.

The HHS and the Privacy Rule define PHI in the following way:

The Privacy Rule protects all "individually identifiable health information" held or transmitted by a covered entity or its business associate, in any form or media, whether electronic, paper, or oral. The Privacy Rule calls this information "protected health information (PHI)."

“Individually identifiable health information” is information, including demographic data, that relates to:

▪ the individual’s past, present or future physical or mental health or condition,

▪ the provision of health care to the individual, or

▪ the past, present, or future payment for the provision of health care to the individual,

and that identifies the individual or for which there is a reasonable basis to believe it can be used to identify the individual.

According to the Privacy Rule, PHI does not include employment records that a covered entity maintains in its capacity as an employer, and education and certain other records subject to, or defined in, the Family Educational Rights and Privacy Act, 20 U.S.C. §1232g.

HIPAA lists 18 identifiers that qualify as PHI, and as such they must be kept secure and private in the ways that are set down in HIPAA and HITECH. These identifiers are:

1. names
2. all geographical subdivisions smaller than a state, including street address, city, county, precinct, zip code, and their equivalent geocodes, except for the initial three digits of a zip code, if according to the current publicly available data from the Bureau of the Census: (1) The geographic unit formed by combining all zip codes with the same three initial digits contains more than 20,000 people; and (2) The initial three digits of a zip code for all such geographic units containing 20,000 or fewer people is changed to 000
3. all elements of dates (except year) for dates directly related to an individual, including birth date, admission date, discharge date, date of death; and all ages over 89 and all elements of dates (including year) indicative of such age, except that such ages and elements may be aggregated into a single category of age 90 or older
4. phone numbers
5. fax numbers
6. electronic mail (email) addresses
7. Social Security numbers
8. medical record numbers (MRNs)
9. health plan beneficiary numbers
10. account numbers
11. certificate/license numbers
12. vehicle identifiers and serial numbers, including license plate numbers
13. device identifiers and serial numbers
14. web addresses or Uniform Resource Locators (URLs)
15. Internet Protocol (IP) address numbers
16. biometric identifiers, including finger and voice prints
17. full face photographic images and any comparable images
18. any other unique identifying number, characteristic, or code (note this does not mean the unique code assigned by the investigator to code the data)

There are also additional standards and criteria to protect individual's privacy from re-identification. Any code used to replace the identifiers in data sets cannot be derived from any information related to the individual and the master codes, nor can the method to derive the codes be disclosed. For example, a subject's initials cannot be used to code their data because the initials are derived from their name. Additionally, the researcher must not have actual knowledge that the research subject could be re-identified from the remaining identifiers in the PHI used in the research study. In other words, the information would still be considered identifiable if there were a way to identify the individual even though all of the 18 identifiers were removed.

De-identified PHI

The government recognizes that there are instances where there is a need to use and/or transmit PHI. Since the key here is whether it can be used to identify the individual, HIPAA provides for two approved "de-identification" methods.

The first is the “Safe Harbor” approach, which permits a covered entity to consider data to be de-identified if it removes the 18 types of identifiers and has no actual knowledge that the remaining information could be used to identify an individual either alone or in combination with other information.

The second method is the "Statistical" approach, which allows disclosure of PHI in any form provided that a qualified statistical or scientific expert concludes, through the use of accepted analytic techniques, that the risk the information could be used alone or in combination with other reasonably available information to identify the subject is very small (statistically insignificant).

Privacy Rule: General principle for use and disclosure

In general, to help in deciding when to disclose or not, it is useful to keep the Privacy Rule's purpose in mind: to define and limit the circumstances in which an individual’s protected heath information may be used or disclosed by covered entities.

A covered entity may not use or disclose protected health information, except either:

1. as the Privacy Rule permits or requires; or
2. as the individual who is the subject of the information (or the individual’s personal representative) authorizes in writing.

Similarly, there are only two cases where a covered entity is actually required to disclose PHI:

1. when the individual to whom the PHI applies (or authorized representative) requests it in writing; or
2. when the HHS is undertaking a compliance investigation, review or enforcement action and requests it.