Data Breaches Continue To Be A Problem For Health Care Providers: South Shore Hospital (Massachusetts) Pays $750,000 To Settle Data Breach Charges

An aptly-timed article from Mass High Tech Business News noted earlier today that: “Data Breaches [Are] a Growing Problem in Health Care.”  This article focused on a recent breach at Boston Children’s Hospital involving the records of 2,000 patients.

The article was prescient, as this afternoon, the Massachusetts Attorney General announced a $750,000 settlement with suburban Boston’s South Shore Hospital, relating to a 2010 data breach.

According to the Attorney General’s press release:

South Shore Hospital has agreed to pay $750,000 to resolve allegations that it failed to protect the personal and confidential health information of more than 800,000 consumers, Attorney General Martha Coakley announced today. The investigation and settlement resulted from a data breach reported to the AG’s Office in July 2010 that included individual’s names, Social Security numbers, financial account numbers, and medical diagnoses….

The consent judgment approved today in Suffolk Superior Court includes a $250,000 civil penalty and a payment of $225,000 for an education fund to be used by the Attorney General’s Office to promote education concerning the protection of personal information and protected health information. In addition to these payments, the consent judgment credits South Shore Hospital for $275,000 to reflect security measures it has taken subsequent to the breach.

The suit and settlement also reflect one of the first uses of the delegated HIPAA enforcement powers of state attorneys general under the Affordable Care Act.

The details are fairly typical of a hospital breach:

In February 2010, South Shore Hospital shipped three boxes containing 473 unencrypted back-up computer tapes with 800,000 individuals’ personal information and protected health information off-site to be erased. The hospital contracted with Archive Data Solutions to erase the back-up tapes and resell them.

The hospital did not inform Archive Data, however, that personal information and protected health information was on the back-up computer tapes nor did South Shore Hospital determine whether Archive Data had sufficient safeguards in place to protect this sensitive information. Multiple companies handled the shipping of the boxes containing the tapes.

In June 2010 South Shore Hospital learned that only one of the boxes arrived at its destination in Texas. The missing boxes have not been recovered although there have been no reports of unauthorized use of the personal information or protected health information of affected individuals to date.

The allegations against South Shore Hospital in the lawsuit are based on both federal and state law violations, including failing to implement appropriate safeguards, policies, and procedures to protect consumers’ information, failing to have a Business Associate Agreement in place with Archive Data, and failing to properly train its workforce with respect to health data privacy.

According to the consent judgment, South Shore Hospital has also agreed to take a variety of steps in order to ensure compliance with state and federal data security laws and regulations, including requirements regarding its contracts with business associates and third-party service providers engaged for data destruction purposes. The hospital also agreed to undergo a review and audit of certain security measures and to report the results and any corrective actions to the Attorney General.

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