First HIPAA Settlement Involving Wireless Health Services Provider: $ 2.5 Million 

Published  on  4/26/2017  by  Gul, Saad

First HIPAA Settlement Involving Wireless Health Services Provider: $ 2.5 Million
By Saad Gul and Michael E. Slipsky
We have previously written that the Internet of Things continues to spawn new cybersecurity and privacy concerns. These vulnerabilities have already served as plot devices for shows such as Homeland. Now, the U.S. Department of Health and Human Services, Office for Civil Rights (OCR), has announced its first settlement with a wireless services provider.
The provider, which provides mobile monitoring to patients at risk for cardiac arrhythmias, had reported the theft of a laptop containing the electronic protected health information (ePHI) of approximately 1,400 individuals.
OCR’s investigation cited several factors that led to a finding of non-compliance:
·         Insufficient risk analysis and risk management processes in place at the time of the theft;
·         Policies and procedures implementing the standards of the HIPAA Security Rule had not been implemented; and
·         The organization could not furnish procedures for safeguarding ePHI, including those on mobile devices.
OCR Director Roger Severino noted that mobile devices remain particularly vulnerable to theft or loss.  While this particular case involved a relatively mundane theft of a laptop computer, the organization’s mobile monitoring business serves as a timely reminder that as Internet-connected medical devices proliferate, so do the opportunities for ePHI security incidents.  For every “smart” pacemaker or Internet-connected insulin pump, there will surely be a hacker trying to test its security.  And as cloudbased applications and the Internet of Things continue to grow, OCR enforcement in the mobile arena will undoubtedly ramp up.
Covered Entities and Business Associates should:
·         Ensure that they have documented ePHI safeguards in place;
·         Conduct annual security assessment reviews and document the results; and
·         Encrypt data where possible.
When it comes to HIPAA compliance, an ounce of prevention can avert a pound (and even $2.5 million) of future pain.
The Resolution Agreement and Corrective Action Plan entered into in connection with this case may be found on the OCR website at
Saad Gul and Mike Slipsky, editors of NC Privacy Law Blog, are partners with Poyner Spruill LLP. They advise clients on a wide range of privacy, data security, and cyber liability issues, including risk management plans, regulatory compliance, cloud computing implications, and breach obligations. Saad (@NC_Cyberlaw) may be reached at 919.783.1170 or Mike may be reached at 919.783.2851 or

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