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What are HIPAA Sanctions?

HIPAA sanctions include a range of penalties for HIPAA violations. The financial and other penalties incurred as a result of HIPAA violations and data breaches can be extraordinarily costly. These can range from significant fines that vary by violation, employee sanctions, organizational costs of issuing breach notifications and mitigating damages following breaches, to the further possibility of criminal prosecution.


Many covered entities and business associates apply employee sanctions for HIPAA violations depending on the magnitude of the breach—whether a violation was intentional or accidental and whether the employee reported the violation as soon as possible. Sanctions can apply to employees who were aware that a HIPAA violation by another employee had occurred but failed to report it. Employee training can prevent HIPAA violations from occurring, whether intentional or accidental. 


An organization can receive a fine whether a violation was unintentional or deliberate. Civil violations often involve situations where a covered entity fails to resolve a breach violation, and the application of civil money penalties helps compensate for the violation. The Office for Civil Rights separates civil money penalties into four categories that range from a Tier 1 violation committed without an entity having known (incurring a possible fine of $100 – $50,000 per violation, with an annual maximum of $25,000 for repeat violations) to a Tier 4 violation in which a breach occurred due to willful negligence and without remedy to the cause of the violation (incurring a fine of $50,000 per violation, and capped at $1.5 million per year). A revised interpretation of the HITECH Act implemented caps, with annual maximums increasing with the severity of the violation tier—a change intended to acknowledge an entity’s level of culpability in a breach and set maximum fines accordingly. 


Companies that manage and monitor their HIPAA compliance on an ongoing basis can more successfully identify any potential data security risks or threats and mitigate those risks before they turn into larger and costlier problems.

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