OCR Announces 2nd HIPAA Settlement of 2021 with Health Insurer for $5.1 Million

January 15, 2021

Buckle your seatbelts – it’s only 15 days into 2021 and it’s already looking like this year will be a wild ride when it comes to HIPAA enforcement. The Office for Civil Rights (OCR) just announced another HIPAA settlement (and a doozy at that), bringing in not one but TWO fines just this week.  

The latest (and greatest) HIPAA fine of 2021 was just awarded to Excellus Health Plan, Inc., a health insurance provider serving over 1.5 million people in New York. The settlement includes a whopping $5.1 million fine and a 2-year corrective action plan, the result of cyber attack affecting more than 9 million records along with a slew of other HIPAA Privacy and Security Rule violations. Fun fact: the OCR didn’t reach $5 million in total fines levied until September of last year, and today’s announcement means they’ve already exceeded the $5 million mark just 15 days into 2021 – talk about starting the year off strong!  

Excellus’ story all started when the OCR received a breach report on September 9, 2015 that cyber-attackers had gained access to Excellus Health Plan’s information technology systems. Of note with this particular breach story is that the hackers in Excellus’ case were accessing their systems so long, they not only set up shop but practically built a whole mall to go with it – hanging out in the health plans’ database from December 23, 2013 allllll the way until May 11, 2015 – an entire year and a half. 

Their overextended stay allowed the hackers to install malware in addition to other malicious activities that provided unauthorized access to the protected health information (PHI) of over 9.3 million individuals – improperly accessing everything from names, to addresses, social security numbers, financial information and clinical treatment information. 

If having hackers in your IT system for almost 2 years wasn’t bad enough, the OCR also found that Excellus had violated some pretty important HIPAA rules, including: 

  • Failure to conduct and enterprise-wide security risk analysis 
  • Failure to implement a risk management program (something recent audit data shows only 6% of practices are hitting all the marks on)
  • Failure to complete an IT system activity review (surprise surprise)
  • And failure to have proper access controls in place (again – no surprise here)

As a great example of what NOT to do when it comes to your HIPAA and technical security programs, today’s fine also offered words of wisdom from the OCR: “Hacking continues to be the greatest threat to the privacy and security of individuals’ health information. In this case, a health plan did not stop hackers from roaming inside its health record system undetected for over a year which endangered the privacy of millions of its beneficiaries,” said OCR Director Roger Severino. “We know that the most dangerous hackers are sophisticated, patient, and persistent. Health care entities need to step up their game to protect the privacy of people’s health information from this growing threat.”   

One positive when it comes to increasingly concerning cyberthreats? The recently passed HIPAA Safe Harbor Bill offers your practice the chance to receive smaller HIPAA fines (even more important with the whopping $5.1 million precedent just set) IF you have the necessary safeguards in place 12 months BEFORE a cyber event. Even though data breaches and hacking incidents aren’t always in your control, practice’s preparation beforehand is – and could mean the difference between a smaller, manageable fine and ranking among the top 10 greatest hits on the OCR’s fine list.    

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