You have to admit that now is a very interesting time to be in the healthcare field.  This year we saw a $1 Trillion healthcare reform bill get passed.  I don’t believe that anyone has a real understanding of the impact of the bill or its affects on medical practices.  It seems every day more details are revealed of the bill.  It will take years before we see the total impact.

Then you have the ARRA stimulus package which provides $19 Billion in Medicare incentives to doctors that embrace the use of certified EHRs.  This is a huge opportunity for medical practices to implement technology and move from paper charts to EHRs.  But along with the incentives come some significant obstacles.  Medical practices have to use a certified EHR but there is no definition of what that means or who the exact certifying bodies are.  As of today you can not purchase an EHR that is certified and will qualify for the stimulus funds.  Practices not only have to implement certified EHRs but they have to use them in a way that shows “meaningful use”.  Of course the exact rules for meaningful use are not known and many argue that the rules that are being proposed are too rigid and the bar is too high for practices to actually show meaningful use.  Taken altogether, you  have a lot of medical practices that want to cash in on the ARRA stimulus incentives and to implement an EHR but you have uncertainty and obstacles that are keeping them on the sideline.  They are taking the wait and see approach.  Some are even thinking that it may not be worth the effort to attempt to participate in the ARRA stimulus incentives.

One thing for certain is that the medical practices that are moving forward with an EHR implementation are spending a lot of money.  There is no way around it, EHRs are expensive.  The cost of the software, hardware, network, training, staff disruption and all of the other components that go into an EHR implementation all add up.  Of course the hope would be that the costs would be offset by the ARRA stimulus incentives but that is not a guarantee as I mentioned before.

At the same time you have all this uncertainty around healthcare reform and ARRA stimulus, medical practices have to contend with two major economic issues.  The first is the severe recession that we have been in since 2008.  There is no way around it, when the economy is suffering all business including medical practices suffer as well.  I hear from my clients that patient visits are down and that waiting rooms are less filled.  This has a significant and real impact on a medical practice’s cash flow and financial health.  The second economic issue is the proposed cut of 21% in Medicare payments to physicians.  For at least 6 months the looming threat of a 21% cut in Medicare payments have darkened the economic sky for medical practices.  Congress has postponed the cuts several times but have not permanently addressed the situation.  As of today, the 21% cut has been pushed back until November 30, 2010.  Along with postponing the Medicare cut, Congress has given doctors a 2.2% increase until November.  Very few medical practices are rejoicing because in December 2010 they are looking at a 23% cut in Medicare payments followed up by a 30% cut in January 2011.  No one really knows what or when the final outcome will be.

On top of major financial outlays to implement EHRs and the uncertainty surrounding the economy and Medicare reimbursements, medical practices have to deal with many government regulations.  As I have written about often, the looming threat of HIPAA Security Audits are a real concern for medical practices.  Implementing HIPAA Security usually require skill sets that medical practices don’t have.  IT security companies are needed to help with policies and procedures, vulnerability and risk assessments along with implementing new technologies such as email and laptop encryption.  On top of HIPAA Security, medical practices face the “Red Flags Rule”  requiring that certain entities develop and implement written identity theft prevention and detection programs to protect consumers from identity theft.  The Red Flags Rule has been postponed several times and was to go into affect June 1, 2010.  As of now the FTC has agreed to keep physicians exempt from the rule until the outcome of a lawsuit by the American Bar Association.  Once again, the outcome of this regulation is unknown.

When you look at each of the issues a medical practice has to address from healthcare reform to Medicare reimbursement cuts they don’t seem to bad.  Each one taken separately allows a medical practice to address the issue and to make modifications to they way they run their business.  But unfortunately all of the issues are happening at the same time.  A medical practice has to address all of the issues together including major financial outlays, cuts in revenue caused by several factors,  and staying abreast and implementing the latest government regulations.  All the time spent addressing these issues is time not spent on seeing and treating patients.

Have other  industries gone through such dramatic change in such a short period of time?  The changes provide opportunities along with real negative affects.  Medical practices need to be flexible and to adjust to all of these changes.  Some of the changes such as the Red Flags Rule may never occur.  But either way a medical practice needs to be prepared, need to be informed and need to be ready to change their business model to adjust to such dramatic changes.  Strange days indeed.

The HITECH Act has shifted the responsible for enforcing the HIPAA Security rule from the Centers for Medicare & Medicaid Services (CMS) to Office for Civil Rights (OCR) which is a part of the Department of Health and Human Services.  OCR has been enforcing the HIPAA Privacy Rule since 2003.  OCR has been gearing up to start HIPAA Security Rule enforcement.  They are working with the consulting company Booz Allen Hamilton to determine the model they are going to be using and how fast they can implement the model.

Susan McAndrew, OCR’s deputy director for privacy said in an interview with HealthcareInfoSecurity.com that:

The audits likely will be outsourced and not conducted by OCR staff.

Security audits will check that organizations have completed a risk assessment and implemented appropriate administrative, technical and physical safeguards.

Audits for compliance with the privacy rule will focus on organizations’ efforts to uphold individuals’ rights, such as their right to access their own medical records.

It seems clear that a major part of any HIPAA Security Audit will be based on how a practice conducted their risk assessment.  As I mentioned in this article, I believe the Risk Assessment is at the core of the HIPAA Security Rule.

McAndrews also mentions the importance of using encryption technology on mobile devices.  She goes on to say:

I am continually surprised by the fact that you actually have to lose your laptop before the light bulb goes on and you say, “Gee, maybe I need an encryption policy here.” You know, you are a lot better off if you can learn from your neighbor. Don’t let it happen to you; encrypt those things now and don’t wait until they are lost to suddenly decide, “Gosh that’s probably a good idea.” And the other lesson I hope people learn is that it is not good enough just to have the policy or to have that light bulb go on. Once you have established that as your policy, you really have to make sure that you train people and it is part of your culture to ensure that encryption happens because, two weeks after you issue the e-mail saying this is what you have to do, life takes over and people think it is too much trouble or they have to go see an IT person and they don’t have time and they walk out the door without getting their laptop encrypted and bad things happen. So it is to have a good policy and enforce that policy so that we don’t have to enforce that policy.

Susan McAndrews give some good insights into what is going to occur with HIPAA Security Audits.  The audits will most likely begin by the end of the year.  They will most likely be outsourced and will not be handled by OCR personnel.  A major focus of the HIPAA Security Audit will be based on a Risk Assessment and how a practice implements the Administrative, Technical and Physical safeguards.  In addition, her advice is to start using encryption on all mobile devices.

The writing is now on the wall.  Now is the time to start thinking about HIPPA security.  It does not matter what phase you are in regarding electronic personal health information (EPHI).  If you are researching EMRs a major concern should be on how the EMR fits into your overall security strategy.  If you have already implemented an EMR then you should make sure that you have completed your risk assessment and that you have implemented the steps required to protect your EPHI.

Update:  OCR has published a paper with guidelines to performing a Risk Analysis.

In a story that makes you scratch your head, a missing CD with over 300,000 names of New Yorkers with developmental and other health issues has been missing for almost a month.

We have not been able to locate within our Early Intervention program unit one disc out of two discs that we received from New York City,” DOH spokeswoman Claudia Hutton said.”At this point, we have no reason to believe they’ve left the building.”

The contents of the disk were encrypted but unfortunately the encryption password may have been written on the outside of the disk.

Adding to concern is the fear that the disc’s password may be written on the outside, although Hutton said the disc is encrypted and could not be read without advanced technical skill.

 

Hutton conceded that putting the password on the disc was not a good idea and amounted to “sloppy housekeeping.”

There is a very good article over at AIS’s Health Business Daily that discusses HIPAA and HITECH violations.  With the signing of the HITECH Act as part of the ARRA stimulus bill, the penalties for HIPAA violations have increased dramatically.  The HITECH Act has also increased the enforcement of HIPAA regulations.

A privacy breach due to “willful neglect” that was corrected within 30 days and affected 100 individuals, which would have cost an organization $10,000 in prior years, will now cost a minimum of $1 million

Covered entities (CEs) — and also business associates, who are now subject to civil and criminal penalties as of this month — need to know what actions (or lack thereof) can push them into the “willful neglect” category, which carries the most severe fines. They may be surprised to learn that routine inaction or procrastination by busy organizations could be categorized as enormously costly willful neglect.

The interim final rule regarding enforcement, published in the Oct. 30, 2009, Federal Register, uses the same language as the previous enforcement rule, stating: “Willful neglect means conscious, intentional failure or reckless indifference to the obligation to comply with the administrative simplification provision violated.”

Where it gets really interesting is the description of “Willful Neglect”

The most obvious demonstration of willful neglect would be when a covered entity has no preventative policies and procedures in place and a breach occurs. Annulis notes that seven years into HIPAA compliance, it’s unlikely that a CE or BA would have no formal protocol.

Greg Young, the privacy officer at Mammoth Hospital in California, however, believes that many small doctors’ offices and clinics still lack policies and procedures because they “don’t feel it’s necessary or don’t want to spend the money. They just want to take care of their patients, not realizing that part of taking care of patients is taking care of their information.”

If you think that just writing policies and procedures will help avoid willful neglect then read on.

“The greatest danger” for an organization, according to former director of OCR Richard Campanelli, now an attorney with Baker & Daniels LLP, is having policies and procedures that no one is enforcing and that employees are not educated about. “A policy on a shelf is not going to be very helpful — it won’t be helpful in protecting privacy and security, and it won’t be helpful in responding to an investigation,” he says. Once a violation occurs, the fact that the policy exists signals to OCR that the organization knows what it should be doing and has chosen not to comply.

The take away from this article is that you need to have policies and procedures in place for both the HIPAA Privacy and Security rules.  These policies and procedures need to be enforced and communicated to all employees.  I would tend to guess that a lot of practices have policies and procedures in place for the Privacy rule.  Practices will need to develop policies and procedures that comply with the Security rule as well.  This is especially true as practices start to create electronic patient health information (ePHI) through the implementation of an EMR, digital x-rays, electronic lab results, billing information, scanned consent forms, etc. The increased use of technology such as laptops, remote access, email, portable disks and smartphones will also require the appropriate policies and procedures. 

Here is a final thought that might keep you up at night.  Imagine a spreadsheet with financial and demographic information of 250 patients that was saved unencrypted on a laptop.  The laptop was taken home by the billing manager and was stolen out of her car.  Did you have a policy and procedure which prevented her from taking the information?  Was it enforced?  Was it communicated to all employees?  Is this an unfortunate HIPAA violation or is this willful neglect?