Hospitals are concerned that the Department of Health and Human Services general counsel's proposed HIPAA enforcement rule increases the potential liability exposure of all covered entities and may result in the imposition of civil money penalties that significantly exceed the statutorily permitted maximum penalty. The rule's proposed methodologies for determining violations of Health Insurance Portability and Accountability Act regulations and the amount of any penalty are not easy to understand and do not provide covered entities with sufficient information to predict and limit their liability.
Provisions imposing liability on a covered entity for the violations incurred by individuals and organizations over whom the covered entity may be able to exercise little real control inappropriately expands the liability exposure of all covered entities. Hospitals are also encouraging HHS not to publicize the identity of civil money penalty recipients, saying the negative and unintended effects would far outweigh any alleged benefit, and endorse HHS' continued emphasis on voluntary compliance.
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