On July 23, 2014, the Massachusetts attorney general announced a settlement with Women & Infants Hospital of Rhode Island (WIH) over the loss of unencrypted backup tapes. WIH agreed to pay $150,000 and undertake numerous compliance measures, including hiring an independent auditor, to resolve allegations that it failed to protect the personal information (PI) and protected health information (PHI) of more than 12,000 Massachusetts patients under HIPAA and Massachusetts’ data security law. The attorney general also alleged that WIH engaged in unfair or deceptive acts or practices by not properly protecting the PI and PHI. This marks the third settlement by the Massachusetts attorney general’s office for allegations that an entity failed to secure its residents’ PHI and PI under HIPAA and state data security laws. This case serves as a good reminder to organizations to know where their identifiable information resides and to properly secure electronic portable media.

The attorney general alleged that WIH realized in April 2012 that it was missing 19 unencrypted backup tapes, but failed to notify individuals and the attorney general until November 2012. The backup tapes were from two prenatal diagnostic centers, one in Massachusetts and one in Rhode Island. The backup tapes contained names, dates of birth, Social Security numbers, dates of exams, physicians’ names, and ultrasound images for 12,127 Massachusetts residents. Information from U.S. Department of Health and Human Services Office for Civil Rights indicates a total of approximately 14,000 affected individuals. The attorney general alleged that these backup tapes were lost in the summer of 2011, but due to inadequate inventory and tracking systems, WIH did not discover the backup tapes were missing until the spring of 2012.

HIPAA requires covered entities to notify individuals of breaches of unsecured protected health information without unreasonable delay and in no case later than 60 calendar days after the date of discovery. HIPAA also requires notification to the HHS secretary for breaches affecting 500 or more individuals within 60 days of the date of discovery. Massachusetts law requires notification to the attorney general and affected residents “as soon as practicable and without unreasonable delay.”

The settlement requires WIH to undertake a comprehensive overhaul of its information security practices, including:

  • Notifying the attorney general of any breach or potential breach affecting Massachusetts residents within 30 days;
  • Developing, implementing, maintaining, and adhering to written information security plans, as required by Massachusetts law;
  • Conducting a HIPAA security risk analysis on at least an annual basis;
  • Conducting yearly workforce training on data security and breach reporting;
  • Maintaining an inventory of all paper and unencrypted electronic PI and PHI;
  • Encrypting, erasing, or destroying all PI or PHI on unencrypted portable devices, including laptops, thumb drives, CDs, and USB drives, to the extent feasible;
  • Obtaining certain assurances when using a third party to dispose of PI or PHI; and
  • Engaging an independent audit of its compliance with HIPAA and the Massachusetts data security law and implementing appropriate corrective measures.

Of the $150,000 that WIH agreed to pay, $110,000 is in civil penalties, $25,000 will go to attorneys’ fees and costs, and $15,000 will go to a fund for the attorney general to use for educational or investigational purposes.