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HHS’ Office for Civil Rights Settles HIPAA Privacy and Security Rule Investigation with Deer Oaks Behavioral Health for $225k and a Corrective Action Plan

Posted on July 8, 2025 by Dissent

In October 2023, Deer Oaks Behavioral Health in Texas disclosed a ransomware attack that affected 171,871 patients, which they discovered on September 1, 2023. LockBit3.0 claimed responsibility at the time and leaked data from the incident. Today, HHS OCR announced a settlement with Deer Oaks following an expanded investigation that had been opened after an earlier breach. The following is HHS OCR’s press release:

Today, the U.S. Department of Health and Human Services (HHS), Office for Civil Rights (OCR) announced a settlement with Deer Oaks – The Behavioral Health Solution (Deer Oaks), a behavioral health provider, resolving potential violations under the Health Insurance Portability and Accountability Act of 1996 (HIPAA) Privacy and Security Rules. Deer Oaks provides psychological and psychiatric services to residents of long-term care and assisted living facilities.

The settlement resolves an investigation that OCR initiated in May 2023 after receiving a complaint alleging that Deer Oaks impermissibly disclosed the ePHI of individuals, including patient names, dates of birth, patient identification numbers, facilities, and diagnoses, by making patient discharge summaries publicly accessible online. OCR’s investigation substantiated the allegations and verified that the ePHI was accessible publicly via the Internet. According to Deer Oaks, a coding error in a now discontinued pilot program for an online patient portal, caused the ePHI to be exposed and cached by search engine providers from at least December 2021 until May 19, 2023. OCR’s investigation found that Deer Oaks impermissibly disclosed the ePHI of 35 individuals when it allowed the discharge summaries and initial assessments of those individuals to be accessible to the public online.

OCR expanded the investigation in July 2024 after Deer Oaks experienced a breach on August 29, 2023, of its network resulting from a compromised account. A threat actor claimed to have exfiltrated data and demanded payment to prevent posting the ePHI on the dark web. Deer Oaks provided breach notifications to HHS, 171,871 affected individuals, and the media related to the August 2023 incident.

Based on its investigation into both incidents, OCR found that Deer Oaks failed to conduct an accurate and thorough risk analysis to determine the potential risks and vulnerabilities to the ePHI that it held.

Under the terms of the resolution agreement, Deer Oaks agreed to implement a corrective action plan that OCR will monitor for two years and paid $225,000 to OCR. Under the corrective action plan, Deer Oaks committed to take steps to ensure compliance with the HIPAA Rules and protect the security of ePHI, including:

  • Annually reviewing and updating as necessary its risk analysis to determine the potential risks and vulnerabilities to the confidentiality, integrity, and availability of its ePHI;
  • Developing and implementing a risk management plan to address and mitigate security risks and vulnerabilities identified in its risk analysis;
  • Developing, maintaining, and revising, as necessary, certain written policies and procedures to comply with the HIPAA Rules; and
  • Providing annual training for each workforce member who has access to PHI on Deer Oaks’ written HIPAA policies and procedures.

The resolution agreement and corrective action plan may be found at: https://www.hhs.gov/sites/default/files/ocr-hipaa-racap-deer-oaks.pdf.

Source: HHS OCR


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Category: Commentaries and AnalysesHealth DataHIPAAMalwareOf NoteU.S.

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