Fuve former Methodist Hospital Employees face criminal charges for conspiring with Roderick Harvey, to unlawfully disclose patient information in violation of the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”) under indictments announced by the Justice Department today.
HIPAA was enacted by Congress in 1996 to create national standards to protect sensitive patient information from being disclosed without a patient’s knowledge or consent. HIPAA’s provisions make it a crime to disclose patient information, or to obtain patient information with the intent to sell, transfer or use such information for personal gain.
According to the indictment, between November 2017 and December 2020, Harvey paid defendants Kirby Dandridge, Sylvia Taylor, Kara Thompson, Melanie Russell and Adrianna Taber, to provide him with names and phone numbers of Methodist patients who had been involved in motor vehicle accidents. After obtaining the information, Harvey sold the information to third persons including personal injury attorneys and chiropractors.
However, if convicted, the conspiracy charge carries a maximum penalty of five years imprisonment, a fine of $250,000 and three-year period of supervised release.
Harvey was also charged with seven counts of obtaining patient information with the intent to sell it for financial gain on various dates between November 12, 2017, and September 7, 2019. Each of those charges carries a maximum penalty of 10 years’ imprisonment, a fine of $250,000 and three years’ of supervised release.
Dandridge, Taylor, Thompson, Russell, and Taber were each charged with separate violations of disclosing the information to Harvey in violation of HIPAA. That charge carries a maximum penalty of one year imprisonment, a $50,000 fine and a one-year period of supervised release.
The Justice Department announcement reminds that charges and allegations in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
The. Indictments demonstrate the criminal liability that health care providers and others can face for willfully misappropriation or other misuse of medical records or other information in violation of HIPAA. Because these violations are federal felonies, Employing organizations like Methodist could face liability under the federal sentencing guidelines unless they have implemented and administered appropriate preventing procedures and taken timely and appropriate corrective action to mitigate that liability under federal criminal law. When the organization investigates in response promptly and has taken appropriate reasonable steps, the Justice Department generally does not pursue criminal charges against the organization. Rather, the organizations liability typically is handled by the Department of Health and Human Services Office of Civil Rights (“OCR”). If it determines that the organization’s deficiencies in compliance with HIPAA contributed to or failed timely to remediate the violations, OCR can pursue civil monetary penalties. In most cases, however, OCR charges are resolved through resolution agreement settlement processes.
The indictments and associated investigations remind other healthcare providers, health plans, healthcare clearinghouse as a business associates of the importance of ensuring that they maintain and administer appropriate processes to prevent breaches of their data by internal personnel and others as well as comply with post breach investigation over mediation and reporting obligations.
We hope this update is helpful. For more information about the these or other health or other legal, management or public policy developments, please contact the author Cynthia Marcotte Stamer via e-mail or via telephone at (214) 452 -8297.
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About the Author
Recognized by her peers as a Martindale-Hubble “AV-Preeminent” (Top 1%) and “Top Rated Lawyer” with special recognition LexisNexis® Martindale-Hubbell® as “LEGAL LEADER™ Texas Top Rated Lawyer” in Health Care Law and Labor and Employment Law; as among the “Best Lawyers In Dallas” for her work in the fields of “Labor & Employment,” “Tax: ERISA & Employee Benefits,” “Health Care” and “Business and Commercial Law” by D Magazine, Cynthia Marcotte Stamer is a practicing attorney board certified in labor and employment law by the Texas Board of Legal Specialization and management consultant, author, public policy advocate and lecturer widely known for 30+ years of health industry and other management work, public policy leadership and advocacy, coaching, teachings, and publications.
A Fellow in the American College of Employee Benefit Counsel, Vice Chair of the American Bar Association (“ABA”) International Section Life Sciences and Health Committee, Past Chair of the ABA Managed Care & Insurance Interest Group, Scribe for the ABA JCEB Annual Agency Meeting with HHS-OCR, past chair of the the ABA RPTE Employee Benefits & Other Compensation Group and current co-Chair of its Welfare Benefit Committee, Ms. Stamer is most widely recognized for her decades of pragmatic, leading edge work, scholarship and thought leadership on health and managed care industry legal, public policy and operational concerns.
Ms. Stamer’s work throughout her 30 plus year career has focused heavily on working with health care and managed care, health and other employee benefit plan, insurance and financial services and other public and private organizations and their technology, data, and other service providers and advisors domestically and internationally with legal and operational compliance and risk management, performance and workforce management, regulatory and public policy and other legal and operational concerns.
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