They say that everything is bigger in Texas, and the Lone Star State’s new privacy protection laws are no exception.  Texas House Bill 300 (“HB 300″) amends the Texas Medical Records Privacy Act (“Texas Act”) and takes effect on September 1, 2012.  HB 300 significantly expands patient privacy protections for Texas covered entities beyond those federal requirements as outlined by the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”) and the Health Information Technology for Economic and Clinical Health (“HITECH”) Act by:

  • revising the definition of a “covered entity;”
  • increasing mandates on covered entities;
  • establishing standards for the use of electronic health records (“EHRs”);
  • granting enforcement authority to several state agencies; and
  • increasing civil and criminal penalties for the wrongful electronic disclosure of protected health information (“PHI”).

Expanded Definition of Covered Entity

HB 300 significantly expands the definition of a Texas “covered entity” to include not only health care providers, but those entities and individuals who under the “HIPAA Privacy Rule” would be classified as business associates and health care payers.  In addition, the Texas Act’s “covered entity” definition includes governmental units, information or computer management entities, schools, health researchers, health care facility, clinics, and persons who maintain an Internet site. As a result, this revision impacts any entity that conducts business in Texas and collects, uses, and/or stores PHI.

Customized Training Required

Mandatory customized employee training regarding state and federal patient privacy and security laws is another significant change to the Texas Act through the adoption of HB 300.  Training must cover federal and state regulatory requirements as well as include the covered entity’s course of business and employees’ scope of employment as it relates to PHI use and disclosure.   Employees of covered entities must complete training at least once every two years and not later than 60 days post-hire date.   This training requirement is more onerous than the HIPAA Privacy Rule, which does not currently require customized staff training and instead requires that employees be trained “within a reasonable period of time” after hire and after any material changes in applicable policies.

 Release of EHR and Consumer Information

After September 1st, covered entities must provide patients with their electronic EHRs within 15 business days after written request.  The Texas Health and Human Services Commission will soon recommend a standard format for the release of EHRs that is consistent with federal law.  Also, following the Office of Civil Rights’ recent lead, the Texas Attorney General’s website will provide consumer access to public health information.  State agencies will file annual complaint reports to the Texas Attorney General who will then provide an annual report about the complaints to the Texas Legislature.

Scope of Notice of Privacy Practices and Penalties Broadened

The law also broadens the scope of covered entities’ Notice of Privacy Practices or other general notices to inform patients about how their e-PHI is used and disclosed.  Entities (such as business associates that are not required to issue a Notice of Privacy Practices under the Privacy Rule) will soon need to issue a notice if PHI is subject to electronic disclosure.  In addition, HB 300 authorizes civil and criminal penalties for data breaches, depending on the breach’s severity, the covered entity’s compliance program, certification, and its corrective action.

Steps to Adopt HB 300’s Requirements

With the effective date nearing, Texas covered entities should take immediate steps to ensure compliance with these more stringent state requirements. To meet this deadline, covered entities should:

  • ramp up their efforts to provide customized employee training;
  • update their Notice of Privacy Practices; and
  • review and update policies to incorporate the new statutory requirements.