Cottage Health to pay USD 3 million for HIPAA violation.

California-based Cottage Health has agreed to pay USD 3 million to the The Department of Health and Human Services’ Office for Civil Rights (OCR) to settle a HIPAA violation during two security breaches in 2013 and 2015. The health provider, which operates four hospitals in California, unintentionally disclosed electronic information of 62,500 patients, including names, addresses, dates of birth, medical record numbers, account numbers, diagnoses, lab results, and procedures performed.

What happened?

In 2013, Cottage Health identified that a server containing patients’ electronic protected health information (ePHI) had not been properly secured. Files containing patients’ ePHI could be accessed over the internet without a username or password. Another similar server misconfiguration was discovered in 2015. After responding to a ticket, the IT team removed protection on a server, which again exposed patients’ ePHI on the internet.

Cottage Health is offering free identity restoration services in case the information of the affected patients is misused. It's also adopting a three-year Corrective Action Plan (CAP) which requires them to conduct a comprehensive, organization-wide risk analysis, and implement a risk management plan to address all security risks and vulnerabilities identified during the risk analysis. It's also reviewing service relationships with third-party vendors and plans to provide training to all staff on HIPAA Privacy and Security Rules.

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