Submitted by Compliance Committee Chair Joan Fusco, Chief Compliance Officer at Savoy Associates
HHS has announced annual adjustments of civil monetary penalties. The latest adjustments are based on a cost-of-living increase of 2.04%.
Here are the highlights:
- HIPAA Administrative Simplification. HIPAA administrative simplification encompasses standards for privacy, security, breach notification and electronic healthcare transactions. The HITECH Act of 2009 created liability for Business Associates and substantially increased the penalty amounts creating four categories of violations. The penalty amounts for each violation are:
- Lack of knowledge: The minimum penalty is $114 (up from $112), the maximum penalty is $57,051 (up from $55,910) and the calendar-year cap is $1,711,533 (up from $1,677,299).
- Reasonable cause and not willful neglect: The minimum penalty is $1,141 (up from $1,118), the maximum penalty is $57,051 (up from $55,910) and the calendar-year cap is $1,711,533 (up from $1,677,299).
- Willful neglect, corrected within 30 days: The minimum penalty is $11,410 (up from $11,182), the maximum penalty is $57,051 (up from $55,910) and the calendar-year cap is $1,711,533 (up from $1,677,299).
- Willful neglect, not corrected within 30 days: The minimum penalty is $57,051, the maximum penalty is $1,711,533 (up from $1,677,299) and the calendar-year cap is $1,711,533 (up from $1,677,299).
- Medicare Secondary Payer.The Medicare Secondary Payer statute prohibits a group health plan from “taking into account” the Medicare entitlement of a current employee or a current employee’s spouse or family member and imposes penalties for violations. The indexed amounts for violations applicable to employer-sponsored health plans are:
- The penalty for an employer that offers incentives to Medicare-eligible individuals not to enroll in a plan that would otherwise be primary is $9,239 (up from $9,054).
- The penalty for willful or repeated failure to provide requested information regarding group health plan coverage is $1,504 (up from $1,474).
- The penalty for responsible reporting entities that fail to provide information identifying situations where group health plan is primary is $1,181 (up from $1,157).
- Summary of Benefits and Coverage.An SBC generally must be provided to participants and beneficiaries before enrollment or re-enrollment in a group health plan. The penalty for a health insurer’s or non-federal governmental health plan’s willful failure to provide an SBC is $1,128 (up from $1,105) for each failure.
These adjustments are effective for penalties assessed on or after October 11, 2018, for violations occurring on or after November 2, 2015.
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