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2nd Settlement Triggered by 2017 Ransomware Attack Costs WA Practice $100K; ‘Not a Breach’

Posted on October 21, 2024October 21, 2024 by Dissent

DataBreaches recently posted a press release from HHS OCR that announced a settlement with Cascade Eye and Skin Centers following a ransomware investigation. Theresa Defino of Report on Patient Privacy (RPP) dug into the incident and investigation more, and her reporting services as a great reminder that HHS’s press releases frequently do not really answer the kinds of questions we have about an incident or HHS’s enforcement actions and reasons. Her piece begins:

Let’s review for a moment.

It’s not a HIPAA violation to be a victim of ransomware.

It’s not a HIPAA violation to pay a ransom.

It’s up to the covered entity (CE) to determine if a security or privacy incident is a breach reportable to the HHS Office for Civil Rights (OCR), patients, the media and state regulators (though, of course, authorities could disagree later).

Yet, on June 17, Amber Gilroy, CEO of Cascade Eye and Skin Centers P.C. of Washington state, signed a settlement agreement with OCR that included a $250,000 payment and an extensive two-year corrective action plan (CAP).[1] OCR didn’t announce the settlement until three months later, and then, as it has with the previous three similar settlements, linked it to the growing incidence of ransomware afflicting health care organizations.

[…]

OCR’s investigation “found multiple potential violations of the HIPAA Security Rule, including failures by Cascade Eye and Skin Centers to conduct a compliant risk analysis to determine the potential risks and vulnerabilities to ePHI in its systems, and to have sufficient monitoring of its health information systems’ activity to protect against a cyber-attack,” it said. However, the settlement agreement itself enumerates just two: risk analysis and regular review of system activity.

Gilroy and Christiansen told RPP they “wanted to reiterate” that the $250,000 is “not based on any finding of a breach, despite the OCR press release implications.” Whether a breach occurred “wasn’t cited or discussed as a possible violation or the basis for the amount of the payment,” they said. As with most settlements, Cascade did not admit to wrongdoing.

Gilroy, who joined Cascade in May 2021, and Christiansen answered all of RPP’s questions except one: the amount of the ransomware.

Read what Defino learned on JDSupra.


Related:

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