Breaking HIPAA rules can trigger immediate workforce sanctions by a HIPAA Covered Entity or Business Associate, mandatory corrective action and monitoring requirements imposed through regulatory resolution, civil monetary penalties assessed by the U.S. Department of Health and Human Services Office for Civil Rights, and criminal prosecution by the U.S. Department of Justice when conduct involves knowing misuse of protected health information.
Internal Employment and Contract Consequences
HIPAA Covered Entities and Business Associates typically apply sanction policies for workforce violations, which can include retraining, written warnings, suspension of access to systems, job reassignment, or termination. Contractors and vendors can face contract remedies, including termination rights and audit requirements in Business Associate Agreements.
Regulatory Investigations and Corrective Actions
Reports, complaints, or breach notifications can lead to review by the U.S. Department of Health and Human Services Office for Civil Rights. Outcomes can include requests for documentation, risk analysis review, policy and procedure updates, workforce training requirements, and multi year monitoring through corrective action plans.
Civil Monetary Penalties
Civil monetary penalties may be assessed when violations reflect noncompliance with the HIPAA Privacy Rule, HIPAA Security Rule, or HIPAA Breach Notification Rule. Penalty amounts depend on the violation category, the organization’s level of culpability, and case specific factors such as the nature and extent of the violation and corrective actions taken.
Criminal Exposure for Certain Conduct
Certain conduct involving wrongful access, use, or disclosure of protected health information can be referred for criminal enforcement by the U.S. Department of Justice. Criminal cases generally involve knowing misconduct, false pretenses, or intent to sell, transfer, or use protected health information for personal gain or malicious harm.
Breach Notification and Operational Impact
An impermissible use or disclosure can trigger incident response, breach risk assessment, and notification workflows under the HIPAA Breach Notification Rule. Organizations may need to notify affected individuals, the U.S. Department of Health and Human Services, and, in some cases, the media, depending on the event and the number of affected individuals.
Additional Liability and Business Impact
HIPAA does not provide a private right of action for individuals to sue for HIPAA violations, but the same incident may lead to claims under state laws or contract disputes. Operational impacts can include client attrition, increased audit activity, remediation costs, and expanded security and privacy controls following the event.