It’s been an expensive few weeks for Community Health Systems and CHSPSC. First, a few weeks ago, HHS announced that
CHSPSC LLC, (“CHSPSC”) has agreed to pay $2,300,000 to the Office for Civil Rights (OCR) at the U.S. Department of Health and Human Services (HHS) and to adopt a corrective action plan to settle potential violations of the Health Insurance Portability and Accountability Act (HIPAA) Privacy and Security Rules related to a breach affecting over six million people. CHSPSC provides a variety of business associate services, including IT and health information management, to hospitals and physician clinics indirectly owned by Community Health Systems, Inc., in Franklin, Tennessee.
In April 2014, the Federal Bureau of Investigation (FBI) notified CHSPSC that it had traced a cyberhacking group’s advanced persistent threat to CHSPSC’s information system.
Community Health Systems announced the breach in August, 2014, after first disclosing it in an SEC filing.
Today, Community Health Systems agreed to pay $5 million to settle charges by 28 state attorneys general. Tennessee’s Attorney General announced the settlement:
Nashville- Tennessee Attorney General Herbert H. Slatery III, along with the Attorneys General of 27 other States, announced a settlement with Tennessee-based CHS/Community Health Systems, Inc., and its subsidiary, CHSPSC LLC. This judgment resolves an investigation of a data breach which impacted approximately 6.1 million patients, including nearly 450,000 in Tennessee.
CHS owned, leased, or operated 206 affiliated hospitals at the time of the data breach in 2014. Exposed in the breach were the names, birthdates, social security numbers, phone numbers, and addresses of patients. The judgment, agreed to by CHS, requires a $5 million payment to the States. Tennessee will receive $666,686.77.
“A patient’s personal information—especially health information—deserves the highest level of protection,” said General Slatery. “This settlement will require CHS to provide that moving forward.”
In addition to the payment, CHS will be required to implement and maintain a comprehensive security program to safeguard patients’ information. Specific measures include: a written incident response plan incorporating security awareness and privacy training for all personnel who have access to Personal Health Information (PHI), limiting unnecessary or inappropriate access to PHI, and implementing specific policies and procedures regarding business associates.
Other states participating in this settlement include Alaska, Arkansas, Connecticut, Florida, Illinois, Indiana, Iowa, Kentucky, Louisiana, Massachusetts, Michigan, Mississippi, Missouri, Nebraska, Nevada, New Jersey, North Carolina, Ohio, Oregon, Pennsylvania, Rhode Island, South Carolina, Texas, Utah, Vermont, Washington, and West Virginia.
To read the Complaint and the Agreed Final Judgment, click here: https://www.tn.gov/content/dam/tn/attorneygeneral/documents/pr/2020/pr20-44-complaint-afj.pdf