$1.7 Million Fine for HIPAA Violation


A database of health records for 612,402 individuals was accessible over the Internet for 5 months which led WellPoint to agree to pay a $1.7 million fine. Wellpoint (a managed care company) agreed to settle the violation of the Health Insurance Portability and Accountability Act of 1996 (HIPAA) after an investigation by the US Department of Health and Human Services (HHS) that electronic protected health information (ePHI) was exposed on the Internet. The exposed ePHI data included “names, dates of birth, addresses, Social Security numbers, telephone numbers and health information”

HHS investigation indicated that Wellpoint did not:

  • adequately implement policies and procedures for authorizing access to the on-line application database
  • perform an appropriate technical evaluation in response to a software upgrade to its information systems
  • have technical safeguards in place to verify the person or entity seeking access to electronic protected health information maintained in its application database.

HHS included in its press release that HIPAA management was expanding:

Beginning Sept. 23, 2013, liability for many of HIPAA’s requirements will extend directly to business associates that receive or store protected health information, such as contractors and subcontractors.

Cybersecurity is such a growing concern worldwide, so without question the data security and management of ePHI under HIPAA will continue to be a major issue for the health care community.

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