Bill Text: CA AB1755 | 2013-2014 | Regular Session | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Medical information.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Passed) 2014-09-18 - Chaptered by Secretary of State - Chapter 412, Statutes of 2014. [AB1755 Detail]

Download: California-2013-AB1755-Amended.html

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BILL NUMBER: AB 1755	AMENDED
	BILL TEXT

	AMENDED IN SENATE  JULY 1, 2014
	AMENDED IN ASSEMBLY  MARCH 28, 2014

INTRODUCED BY   Assembly Member Gomez

                        FEBRUARY 14, 2014

   An act to amend Section 1280.15 of the Health and Safety Code,
relating to public health.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 1755, as amended, Gomez. Medical information.
   Existing law requires a clinic, health facility, home health
agency, or hospice to prevent unlawful or unauthorized access to, and
use or disclosure of, patients' medical information, as defined.
Existing law requires the clinic, health facility, home health
agency, or hospice to report any unlawful or unauthorized access to,
or use or disclosure of, a patient's medical information to the State
Department of Public Health and to the affected patient or the
patient's representative no later than 5 business days after the
unlawful or unauthorized access, use, or disclosure has been
detected.  Existing law requires that the report to the patient
or the patient's representative be made to that person's last known
address. Existing law requires these entities to delay the report for
specified law enforcement   purposes and requires that the
delayed report be submitted within 5 days of the end of the delay.
 Existing law authorizes the State Department of Public Health
to assess administrative penalties for violation of these provisions
 and gives the department discretion to consider all factors when
determining the amount of a penalty  .
   This bill would instead require those entities  to prevent
breaches of patients' medical information, as defined, and to report
any breach of a patient's medical information to the department and
to the affected patient or the patient's representative without
unreasonable delay and in no case later than 60 calendar 
 to make those reports no later   than 15 business 
days after the  breach   unlawful or
unauthorized access   , use, or disclosure  has been
detected  , as specified   and would authorize
the report made to the patient or the patient's representative to be
made by alternative means, including email, as specified. The bill
would also require a delayed report for law enforcement purposes to
be made within 15 business days of the end of the delay. The bill
would give the department full discretion to consider all factors
when determining whether to investigate under these provisions 
.
   Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

   SECTION 1.    Section 1280.15 of the  
Health and Safety Code   is amended to read: 
   1280.15.  (a) A clinic, health facility, home health agency, or
hospice licensed pursuant to Section 1204, 1250, 1725, or 1745 shall
prevent unlawful or unauthorized access to, and use or disclosure of,
patients' medical information, as defined in Section 56.05 of the
Civil Code and consistent with Section 130203. For purposes of this
section, internal paper records, electronic mail, or facsimile
transmissions inadvertently misdirected within the same facility or
health care system within the course of coordinating care or
delivering services shall not constitute unauthorized access to, or
use or disclosure of, a patient's medical information. The
department, after investigation, may assess an administrative penalty
for a violation of this section of up to twenty-five thousand
dollars ($25,000) per patient whose medical information was
unlawfully or without authorization accessed, used, or disclosed, and
up to seventeen thousand five hundred dollars ($17,500) per
subsequent occurrence of unlawful or unauthorized access, use, or
disclosure of that patient's medical information. For purposes of the
investigation, the department shall consider the clinic's, health
facility's, agency's, or hospice's history of compliance with this
section and other related state and federal statutes and regulations,
the extent to which the facility detected violations and took
preventative action to immediately correct and prevent past
violations from recurring, and factors outside its control that
restricted the facility's ability to comply with this section. The
department shall have full discretion to consider all factors when
determining  whether to investigate and  the amount of an
administrative penalty  ,   if any,  pursuant to
this section.
   (b) (1) A clinic, health facility, home health agency, or hospice
to which subdivision (a) applies shall report any unlawful or
unauthorized access to, or use or disclosure of, a patient's medical
information to the department no later than  five 
 15  business days after the unlawful or unauthorized
access, use, or disclosure has been detected by the clinic, health
facility, home health agency, or hospice.
   (2) Subject to subdivision (c), a clinic, health facility, home
health agency, or hospice shall also report any unlawful or
unauthorized access to, or use or disclosure of, a patient's medical
information to the affected patient or the patient's representative
at the last known address,  or by an alternative means or at an
alternative location as specified by the patient or the patient's
representative in writing pursuant to Section 164.522(b) of Title 45
of the Code of Federal Regulations,  no later than  five
  15  business days after the unlawful or
unauthorized access, use, or disclosure has been detected by the
clinic, health facility, home health agency, or hospice.  Notice
may be provided by email only if the patient has previously agreed in
writing to electronic notice by email. 
   (c) (1) A clinic, health facility, home health agency, or hospice
shall delay the reporting, as required pursuant to paragraph (2) of
subdivision (b), of any unlawful or unauthorized access to, or use or
disclosure of, a patient's medical information beyond  five
  15  business days if a law enforcement agency or
official provides the clinic, health facility, home health agency, or
hospice with a written or oral statement that compliance with the
reporting requirements of paragraph (2) of subdivision (b) would
likely impede the law enforcement agency's investigation that relates
to the unlawful or unauthorized access to, and use or disclosure of,
a patient's medical information and specifies a date upon which the
delay shall end, not to exceed 60 days after a written request is
made, or 30 days after an oral request is made. A law enforcement
agency or official may request an extension of a delay based upon a
written declaration that there exists a bona fide, ongoing,
significant criminal investigation of serious wrongdoing relating to
the unlawful or unauthorized access to, and use or disclosure of, a
patient's medical information, that notification of patients will
undermine the law enforcement agency's investigation, and that
specifies a date upon which the delay shall end, not to exceed 60
days after the end of the original delay period.
   (2) If the statement of the law enforcement agency or official is
made orally, then the clinic, health facility, home health agency, or
hospice shall do both of the following:
   (A) Document the oral statement, including, but not limited to,
the identity of the law enforcement agency or official making the
oral statement and the date upon which the oral statement was made.
   (B) Limit the delay in reporting the unlawful or unauthorized
access to, or use or disclosure of, the patient's medical information
to the date specified in the oral statement, not to exceed 30
calendar days from the date that the oral statement is made, unless a
written statement that complies with the requirements of this
subdivision is received during that time.
   (3) A clinic, health facility, home health agency, or hospice
shall submit a report that is delayed pursuant to this subdivision
not later than  five   15  business days
after the date designated as the end of the delay.
   (d) If a clinic, health facility, home health agency, or hospice
to which subdivision (a) applies violates subdivision (b), the
department may assess the licensee a penalty in the amount of one
hundred dollars ($100) for each day that the unlawful or unauthorized
access, use, or disclosure is not reported to the department or the
affected patient, following the initial  five-day 
 15-day  period specified in subdivision (b). However, the
total combined penalty assessed by the department under subdivision
(a) and this subdivision shall not exceed two hundred fifty thousand
dollars ($250,000) per reported event. For enforcement purposes, it
shall be presumed that the facility did not notify the affected
patient if the notification was not documented. This presumption may
be rebutted by a licensee only if the licensee demonstrates, by a
preponderance of the evidence, that the notification was made.
   (e) In enforcing subdivisions (a) and (d), the department shall
take into consideration the special circumstances of small and rural
hospitals, as defined in Section 124840, and primary care clinics, as
defined in subdivision (a) of Section 1204, in order to protect
access to quality care in those hospitals and clinics. When assessing
a penalty on a skilled nursing facility or other facility subject to
Section 1423, 1424, 1424.1, or 1424.5, the department shall issue
only the higher of either a penalty for the violation of this section
or a penalty for violation of Section 1423, 1424, 1424.1, or 1424.5,
not both.
   (f) All penalties collected by the department pursuant to this
section, Sections 1280.1, 1280.3, and 1280.4, shall be deposited into
the Internal Departmental Quality Improvement Account, which is
hereby created within the Special Deposit Fund under Section 16370 of
the Government Code. Upon appropriation by the Legislature, moneys
in the account shall be expended for internal quality improvement
activities in the Licensing and Certification Program.
   (g) If the licensee disputes a determination by the department
regarding a failure to prevent or failure to timely report unlawful
or unauthorized access to, or use or disclosure of, patients' medical
information, or the imposition of a penalty under this section, the
licensee may, within 10 days of receipt of the penalty assessment,
request a hearing pursuant to Section 131071. Penalties shall be paid
when appeals have been exhausted and the penalty has been upheld.
   (h) In lieu of disputing the determination of the department
regarding a failure to prevent or failure to timely report unlawful
or unauthorized access to, or use or disclosure of, patients' medical
information, transmit to the department 75 percent of the total
amount of the administrative penalty, for each violation, within 30
business days of receipt of the administrative penalty.
   (i) Notwithstanding any other law, the department may refer
violations of this section to the Office of Health Information
Integrity for enforcement pursuant to Section 130303.
   (j) For purposes of this section, the following definitions shall
apply:
   (1) "Reported event" means all breaches included in any single
report that is made pursuant to subdivision (b), regardless of the
number of breach events contained in the report.
   (2) "Unauthorized" means the inappropriate access, review, or
viewing of patient medical information without a direct need for
medical diagnosis, treatment, or other lawful use as permitted by the
Confidentiality of Medical Information Act (Part 2.6 (commencing
with Section 56) of Division 1 of the Civil Code) or any other
statute or regulation governing the lawful access, use, or disclosure
of medical information. 
  SECTION 1.    Section 1280.15 of the Health and
Safety Code is amended to read:
   1280.15.  (a) A clinic, health facility, home health agency, or
hospice licensed pursuant to Section 1204, 1250, 1725, or 1747 shall
prevent breaches of patients' medical information as required by
Section 130203. For purposes of this section, internal paper records,
e-mail, or facsimile transmissions inadvertently misdirected within
the same facility or health care system within the course of
coordinating care or delivering services shall not constitute a
breach of a patient's medical information. The department, after
investigation, may assess an administrative penalty for a violation
of this section of up to twenty-five thousand dollars ($25,000) per
patient whose medical information was breached, and up to seventeen
thousand five hundred dollars ($17,500) per subsequent breach of that
patient's medical information. For purposes of the investigation,
the department shall consider the clinic's, health facility's, agency'
s, or hospice's history of compliance with this section and other
related state and federal statutes and regulations, the extent to
which the facility detected violations and took preventative action
to immediately correct and prevent past violations from recurring,
and factors outside its control that restricted the facility's
ability to comply with this section. The department shall have full
discretion to consider all factors when determining the amount of an
administrative penalty pursuant to this section.
   (b) (1) A clinic, health facility, home health agency, or hospice
to which subdivision (a) applies shall report any breach of a patient'
s medical information to the department without unreasonable delay
and in no case later than 60 calendar days after the breach has been
detected by the clinic, health facility, home health agency, or
hospice.
   (2) Subject to subdivision (c), a clinic, health facility, home
health agency, or hospice shall also report any breach of a patient's
medical information to the affected patient or the patient's
representative at the last known address,, or by an alternative means
or at an alternative location as specified by the patient or the
patient's representative in writing pursuant to Section 164.522(b) of
Title 45 of the Code of Federal Regulations, without unreasonable
delay and in no case later than 60 calendar days after the breach has
been detected by the clinic, health facility, home health agency, or
hospice. Notice may be provided by e-mail only if the patient has
previously agreed in writing to electronic notice by e-mail.
   (c) (1) A clinic, health facility, home health agency, or hospice
shall delay the reporting, as required pursuant to paragraph (2) of
subdivision (b), of any breach of a patient's medical information if
a law enforcement agency or official provides the clinic, health
facility, home health agency, or hospice with a written or oral
statement that compliance with the reporting requirements of
paragraph (2) of subdivision (b) would likely impede the law
enforcement agency's investigation that relates to the breach of a
patient's medical information and specifies a date upon which the
delay shall end, not to exceed 60 days after a written request is
made, or 30 days after an oral request is made. A law enforcement
agency or official may request an extension of a delay based upon a
written declaration that there exists a bona fide, ongoing,
significant criminal investigation of serious wrongdoing relating to
the breach of a patient's medical information, that notification of
patients will undermine the law enforcement agency's investigation,
and that specifies a date upon which the delay shall end, not to
exceed 60 days after the end of the original delay period.
   (2) If the statement of the law enforcement agency or official is
made orally, then the clinic, health facility, home health agency, or
hospice shall do both of the following:
   (A) Document the oral statement, including, but not limited to,
the identity of the law enforcement agency or official making the
oral statement and the date upon which the oral statement was made.
   (B) Limit the delay in reporting the breach of the patient's
medical information to the date specified in the oral statement, not
to exceed 30 calendar days from the date that the oral statement is
made, unless a written statement that complies with the requirements
of this subdivision is received during that time.
   (3) A clinic, health facility, home health agency, or hospice
shall submit a report that is delayed pursuant to this subdivision
not later than five business days after the date designated as the
end of the delay.
   (d) If a clinic, health facility, home health agency, or hospice
to which subdivision (a) applies violates subdivision (b), the
department may assess the licensee a penalty in the amount of one
hundred dollars ($100) for each day that the breach is not reported
to the department or the affected patient, following the initial
period specified in subdivision (b). However, the total combined
penalty assessed by the department under subdivision (a) and this
subdivision shall not exceed two hundred fifty thousand dollars
($250,000) per reported event. For enforcement purposes, it shall be
presumed that the facility did not notify the affected patient if the
notification was not documented. This presumption may be rebutted by
a licensee only if the licensee demonstrates, by a preponderance of
the evidence, that the notification was made.
   (e) In enforcing subdivisions (a) and (d), the department shall
take into consideration the special circumstances of small and rural
hospitals, as defined in Section 124840, and primary care clinics, as
defined in subdivision (a) of Section 1204, in order to protect
access to quality care in those hospitals and clinics. When assessing
a penalty on a skilled nursing facility or other facility subject to
Section 1423, 1424, 1424.1, or 1424.5, the department shall issue
only the higher of either a penalty for the violation of this section
or a penalty for violation of Section 1423, 1424, 1424.1, or 1424.5,
not both.
   (f) All penalties collected by the department pursuant to this
section and Sections 1280.1, 1280.3, and 1280.4 shall be deposited
into the Internal Departmental Quality Improvement Account, which is
hereby created within the Special Deposit Fund under Section 16370 of
the Government Code. Upon appropriation by the Legislature, moneys
in the account shall be expended for internal quality improvement
activities in the Licensing and Certification Program.
   (g) If the licensee disputes a determination by the department
regarding a failure to prevent or failure to timely report a breach
of patients' medical information, or the imposition of a penalty
under this section, the licensee may, within 10 days of receipt of
the penalty assessment, request a hearing pursuant to Section 131071.
Penalties shall be paid when appeals have been exhausted and the
penalty has been upheld.
   (h) In lieu of disputing the determination of the department
regarding a failure to prevent or failure to timely report a breach
of patients' medical information, transmit to the department 75
percent of the total amount of the administrative penalty, for each
violation, within 30 business days of receipt of the administrative
penalty.
   (i) Notwithstanding any other law, the department may refer
violations of this section to the Office of Health Information
Integrity for enforcement pursuant to Section 130303.
   (j) For purposes of this section, the following definitions shall
apply:
   (1) "Breach" means the acquisition, access, use, or disclosure of
unsecured medical information in a manner not permitted under state
or federal health information privacy laws that compromises the
security or privacy of the medical information.
   (A) "Breach" does not include any of the following:
   (i) Any unintentional acquisition, access, or use of medical
information by a workforce member or person acting under the
authority of a clinic, health facility, home health agency, or
hospice to which subdivision (a) applies, or a business associate, if
that acquisition, access, or use was made in good faith and within
the scope of authority and does not result in further use or
disclosure in a manner not permitted under state or federal health
information privacy laws.
   (ii) Any inadvertent disclosure by a person who is authorized to
access medical information at a clinic, health facility, home health
agency, or hospice to which subdivision (a) applies or a business
associate to another person authorized to access medical information
at the same entity or business associate, or organized health care
arrangement in which the clinic, health facility, home health agency,
or hospice to which subdivision (a) participates, and the
information received as a result of the disclosure is not further
used or disclosed in a manner not permitted under state or federal
health information privacy laws.
   (iii) A disclosure of medical information when a clinic, health
facility, home health agency, or hospice to which subdivision (a)
applies or business associate has a good faith belief that an
unauthorized person to whom the disclosure was made would not
reasonably have been able to retain the information.
   (B) Except as provided in subdivision (a) and subparagraph (A), an
acquisition, access, use, or disclosure of medical information in a
manner not permitted under state or federal health information
privacy laws is presumed to be a breach unless the clinic, health
facility, home health agency, or hospice to which subdivision (a)
applies or business associate, as applicable, demonstrates that there
is a low probability that the medical information has been
compromised based on a risk assessment of at least the following
factors:
   (i) The nature and extent of the medical information involved,
including the types of identifiers and the likelihood of
reidentification.
   (ii) The unauthorized person who used the medical information or
to whom the disclosure was made.
   (iii) Whether the medical information was actually acquired or
viewed.
   (iv) The extent to which the risk to the medical information has
been mitigated.
   (2) "Business associate" has the meaning provided in regulations
issued pursuant to the Health Information Portability and
Accountability Act of 1996 (Public Law 104-191)(HIPAA) found in Parts
160 and 164 of Title 45 of the Code of Federal Regulations.
   (3) "Detected" means that sufficient facts are known about an
incident such that a reasonable person would believe that a breach of
a patient's medical information has taken place.
   (4) "Medical information" has the meaning provided in Section
56.05 of the Civil Code.
   (5) "Organized health care arrangement" has the meaning provided
in regulations issued pursuant to HIPAA found in Parts 160 and 164 of
Title 45 of the Code of Federal Regulations.
   (6) "Reported event" means all breaches included in any single
report that is made pursuant to subdivision (b), regardless of the
number of breach events contained in the report.
   (7) "Unauthorized" means the inappropriate access, review, or
viewing of patient medical information without a direct need for
medical diagnosis, treatment, or other lawful use as permitted by the
Confidentiality of Medical Information Act (Part 2.6 (commencing
with Section 56) of Division 1 of the Civil Code) or any other
statute or regulation governing the lawful access, use, or disclosure
of medical information.
   (8) "Unsecured medical information" means medical information that
is not rendered unusable, unreadable, or indecipherable to
unauthorized persons though use of a technology or methodology
specified by the United States Secretary of Health and Human Services
in the guidance issued under Section 13402(h)(2) of the American
Recovery and Reinvestment Act of 2009 (Public Law 111-5).
   (9) "Workforce" has the meaning provided in regulations issued
pursuant to HIPAA found in Parts 160 and 164 of Title 45 of the Code
of Federal Regulations.