Lifespan Pays $1,040,000 to OCR to Settle Unencrypted Stolen Laptop Breach

In April, 2017, Lifespan issued a statement disclosing a stolen laptop incident involving unencrypted protected health information.  In at least two places in their statement they claim that they are committed to protecting the security and confidentiality of patient data.

Today, OCR announced a settlement with Lifespan in which Lifespan is to pay more than $1 million dollars and implement a corrective action plan. It seems like OCR is sending an expensive reminder to entities to encrypt mobile devices. Let’s see what OCR’s press release says:

Lifespan Health System Affiliated Covered Entity (Lifespan ACE), a non-profit health system based in Rhode Island, has agreed to pay $1,040,000 to the Office for Civil Rights (OCR) at the U.S. Department of Health and Human Services (HHS) and to implement a corrective action plan to settle potential violations of the Health Insurance Portability and Accountability Act (HIPAA) Privacy and Security Rules related to the theft of an unencrypted laptop.  Lifespan ACE includes many healthcare provider affiliates in Rhode Island, and has designated itself as a HIPAA affiliated covered entity.1

On April 21, 2017, Lifespan Corporation, the parent company and business associate of Lifespan ACE, filed a breach report with OCR concerning the theft of an affiliated hospital employee’s laptop containing electronic protected health information (ePHI) including: patients’ names, medical record numbers, demographic information, and medication information. The breach affected 20,431 individuals.

OCR’s investigation determined that there was systemic noncompliance with the HIPAA Rules including a failure to encrypt ePHI on laptops after Lifespan ACE determined it was reasonable and appropriate to do so.  OCR also uncovered a lack of device and media controls, and a failure to have a business associate agreement in place with the Lifespan Corporation.

“Laptops, cellphones, and other mobile devices are stolen every day, that’s the hard reality.  Covered entities can best protect their patients’ data by encrypting mobile devices to thwart identity thieves,” said Roger Severino, OCR Director.

In addition to the monetary settlement, Lifespan has agreed to a corrective action plan that includes two years of monitoring. The resolution agreement and corrective action plan may be found at: https://www.hhs.gov/sites/default/files/lifespan-ra-cap-signed.pdf – PDF*.

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