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HIPAA ENFORCEMENT
RULE
Provisions
(Reprinted From the Department of Health and Human
Resources) |
We
discuss the HIPAA Enforcement Rule on a provision-by-provision basis below. As
a general matter, we note that the provisions adopted are in many cases the
same as or similar to analogous provisions of the Office of the Inspector
General (OIG) regulations. Where we have closely followed the OIG regulations,
we have done so because we believe that these procedures work and
satisfactorily address issues of concern addressed in prior rulemakings by the
OIG. We do not reiterate those concerns, or their resolutions, here, but they
have informed our decisionmaking on these rules.
Applicability
Section 160.500 states that the procedures
established by this subpart are applicable to investigations, imposition of
penalties, and hearings conducted as a result of a proposed imposition of civil
money penalties. We use "applicability" instead of the basis and purpose
statement of the OIG regulations, because we have followed a different format
in the remainder of the HIPAA rules and wish to be consistent with that
approach. Furthermore, this preamble constitutes the requisite basis and
purpose statement.
Definitions
Definitions for the terms
used in this new subpart that are not set forth elsewhere in part 160 are
included in § 160.502.
- ALJ means an administrative law
judge, the natural person who presides at and conducts a hearing requested by a
respondent pursuant to this subpart.
- OIG means Office of the Inspector
General.
- CMP means Civil Monetary
Penalties.
- Entity means a legal person that is
not a natural person. The term is intended to include all manner of
organizations, such as corporations, associations, partnerships, and other
entities that have a legal existence, other than a natural person. The term
"entity" is necessary for this subpart to distinguish such legal persons from
natural persons, because certain procedures in this rule, such as those
involving subpoenas, are different for entities than they are for natural
persons.
The term "entity" should not be confused with the regulatory
term "covered entity." The latter term, which is defined at § 160.103,
denotes those entities to which the HIPAA rules apply. The term "entity," as
used in the rule, describes a broader class of persons. For example, subpoenas
could be directed to entities that are not covered entities under §
160.504.
- Penalty is defined to mean the
amount calculated under 42 U.S.C. 1320d-5. This section of HIPAA sets a penalty
of not more than $100 for each violation, subject to a calendar-year cap of
$25,000 for all violations of an identical requirement or prohibition. The term
includes the plural form of the word.
- Person is defined to mean a natural
person or a legal person (such as an entity described above). The term
includes, but is not limited to, covered entities. The term is broader than
"covered entities," because some sections of the provisions by their nature
apply to persons other than covered entities in certain circumstances. For
example, the provisions for subpoenas relate to natural persons who will be
called to testify, and many, if not most, of these persons will not be covered
entities. While the term "person" is used generically throughout the HIPAA
rules, we have provided a definition of the term "person" for use in this
subpart to provide a clear and efficient way of permitting these distinctions
to be drawn. This definition is not intended to define "person" as that term is
used in HIPAA.
- Respondent means a person (as
defined herein) upon whom a penalty has been imposed, whether proposed or
final, by the Secretary. Respondents will necessarily be covered entities. See
the discussion of § 160.506.
Investigational
subpoenas and inquiries
Section 160.504 provides procedures for the
issuance of subpoenas to both named persons and unnamed persons associated with
subpoenaed entities. A subpoenaed entity is required to name a natural person
or persons knowledgeable about the subjects on which information is sought.
This procedure is similar to that provided for in Rule 30(b)(6) of the Federal
Rules of Civil Procedure. Subpoenas issued under this section may require
either testimony or the production of evidence.
The procedures adopted
in this section are similar to those in 42 CFR part 1006. Like § 1006.4,
§ 160.504 provides that investigational inquiries are non-public
proceedings conducted by the Secretary. A witness is entitled to be represented
by an attorney during an investigational inquiry. However, while this section
provides for the taking of witness testimony, it does not include all of the
provisions of § 1006.4 regarding claims of privilege or objections,
clarification of answers by the witness, corrections to the transcript, or the
use by the Secretary of testimony or evidence obtained in an investigational
inquiry. We anticipate addressing these issues in the notice-and-comment
rulemaking that we plan for the remainder of the Enforcement Rule.
Under § 160.506,Civil Monetary Penalties (CMP) are imposed for
violations of 42 U.S.C. 1320d - 1320d-8, section 264 of Pub. L. 104-191, or the
implementing regulations at parts 160, 162 or 164 of this subchapter. CMPs may
be imposed only on covered entities. As we have stated in prior rulemakings, it
is the view of HHS that only covered entities are subject to the HIPAA
provisions and rules. Thus, only covered entities can be liable for a CMP under
42 U.S.C. 1320d-5. See, for example, 67 FR 53252. Regulatory definition of what
constitutes a violation requiring imposition of a CMP will be addressed in the
subsequent notice-and-comment rulemaking that we plan for the remainder of the
Enforcement Rule. This section, thus, functions to clarify and establish the
linkage of the procedural rules to the criteria and processes for the
substantive determinations that are to be developed through notice-and-comment
rulemaking.
Basis for Penalty
Amount of Penalty
Under § 160.508, the amount of the penalty is determined in
accordance with 42 U.S.C. 1320d-5 and the provisions of this part. We
anticipate addressing how penalties will be determined in the
notice-and-comment rulemaking that we plan for the remainder of the Enforcement
Rule. This section thus functions to clarify and establish the linkage of the
procedural rules to the criteria and processes for the substantive
determinations that are still to be developed.
Authority to Settle
Section 160.510 enunciates the authority of the Secretary to settle
any issue or case or to compromise any penalty during the process addressed in
this subpart. This authority is the same as that set forth in §
1003.106(f)(3) of the OIG regulations and implements statutory authority
provided by the first sentence of 42 U.S.C. 1320a-7a(f). It provides for
flexible resolution of cases and issues between the Secretary and a respondent.
We anticipate that factors to be taken into account in determinations regarding
the amount of penalties, like those set forth in § 1003.106 (a) through
§ 1003.106(e) of the OIG regulations, will be addressed in the
notice-and-comment rulemaking that we plan for the remainder of the Enforcement
Rule. This section, like the preceding sections, thus serves to link
substantive provisions yet to be developed into the procedural process put in
place by the rules.
Notice of Proposed Determination
Section 160.514 sets forth the requirements for the notice to a
respondent sent when the Secretary proposes a penalty under this part. These
requirements are substantially the same as those in § 1003.109 of the OIG
regulations. Statistical sampling provisions, however, are not included in this
section at this time. We anticipate addressing statistical sampling in the
notice-and-comment rulemaking that we plan for the remainder of the Enforcement
Rule.
Failure to Request a Hearing
Under § 160.516,
when a respondent does not timely request a hearing on a proposed penalty, the
Secretary will impose the proposed penalty or any less severe penalty permitted
by 42 U.S.C. 1320d-5. The penalty is then final, and the respondent has no
right to appeal a penalty imposed under these circumstances. This section is
similar to § 1003.110 of the OIG regulations. This section simply states
the necessary consequence of a respondent's failure to exercise the right to a
hearing.
Collection of Penalty
Section 160.518 provides
that once a determination to impose a penalty has become final, the penalty
must be collected by the Secretary. The penalty may be recovered in a civil
action in United States District Court, or by deduction from any sum owed to
the respondent by the United States or a State agency. If the Secretary seeks
to recover the penalty in a civil action, the respondent is prohibited from
raising in that proceeding any matter that was raised or could have been raised
in a hearing or appeal under this subpart. These provisions restate statutory
provisions at 42 U.S.C. 1320a-7a(f) and (g).
Limitations
Section 160.522 sets forth the 6-year limitations period provided
for by 42 U.S.C. 1320a-7a(c)(1). The section includes only the part of the
statutory language that is relevant to the imposition of penalties in the
context of the HIPAA rules. The statutory language concerning the "claim was
presented" and "request for payment" are not included, because these phrases
pertain to violations described in the parts of 42 U.S.C. 1320a-7a that are not
incorporated by reference into 42 U.S.C. 1320d-5. Section 160.522 accordingly
differs in this respect from § 1003.132 of the OIG regulations.
Hearing Before an Administrative Law Judge (ALJ)
The
requirements for a hearing request are contained in § 160.526. The parties
to a hearing are the party against whom the Secretary has proposed a penalty
(the respondent) and the Secretary. We recognize that the HHS party will be OCR
and/or CMS. We have not described the party more specifically here, however,
for several reasons. First, it is not feasible to parse out which component
will actually appear for the Secretary, because the appropriate component (if
both are not) will depend on the facts of the case. Second, the designation of
the proper party component can be handled through the normal delegation
process. Third, similar issues arise in other sections of the Rule (see, for
example, § 160.514), and they are handled this way in those sections as
well. A consistent approach is less confusing and more manageable.
The
respondent may request a hearing following receipt of a notice of a proposed
determination. The request for a hearing must be in writing. If the respondent
fails to timely request a hearing, or thereafter withdraws or abandons the
request for a hearing, or if the hearing request fails to raise any issue that
may properly be addressed in a hearing, the administrative law judge (ALJ) is
required to dismiss the hearing request. In such a case, the penalty becomes
final, with no further appeal permitted.
Paragraph (c) of §
160.526 differs slightly from the corresponding paragraph in § 1005.2. Our
provision requires specific admissions, denials or explanations in a
respondent's hearing request. The degree of specificity required generally
parallels the requirements applicable to the notice of proposed determination
at § 160.514. Based on experience in prior administrative hearings, we
believe that such additional specificity will assist the parties and the ALJ in
ascertaining the findings of fact and conclusions of law that are actually in
dispute in a case. This certainty will promote procedural regularity and permit
more timely and efficient resolution of the case between the parties or
adjudication of the case by the ALJ.
Rights of Parties; Authority of
the ALJ
The provisions in § 160.528 and § 160.530 list
the rights of the parties and the authorities of the ALJ not specifically
provided elsewhere in this part. These sections are based upon § 1005.3
and § 1005.4 of the OIG regulations, but do not address attorneys' fees
under 42 U.S.C. 406 or any limitation on the ALJ's authority to review the
Secretary's exercise of discretion to impose a penalty. We anticipate
addressing such issues in the notice-and-comment rulemaking that we plan for
the remainder of the Enforcement Rule. We have clarified in § 160.530 that
a summary judgment decision constitutes a hearing on the record.
Ex-parte Contacts
The provisions of § 160.532 are
designed to ensure the fairness of the hearing by prohibiting ex-parte contacts
with the ALJ on matters in issue. Routine questions about administrative
procedures or the status of the case are permitted. These requirements are
generally applicable to administrative hearings under 5 U.S.C. 554(d)(1) and
are the same as those in § 1005.5 of the OIG regulations.
Prehearing Conferences
The provisions of § 160.534
closely track the provisions of the analogous OIG regulation at § 1005.6.
The ALJ is required to schedule at least one prehearing conference, in order to
narrow the issues to be addressed at the hearing and thus expedite the formal
hearing process. Matters that may be discussed at a prehearing conference are
identified and include the protection of the privacy of individually
identifiable health information submitted into evidence, if appropriate.
Settlement
The Secretary has exclusive authority to
settle any issue or case at any time and need not obtain the consent of the
ALJ. This provision in § 160.536 tracks § 1003.126 of the OIG
regulations.
Discovery
Consistent with the approach of
§ 1005.7 of the OIG regulations, § 160.538 provides for limited
discovery in the form of the production for inspection and copying of documents
that are relevant and material to the issues before the ALJ. Like the OIG, we
are specifically not authorizing other forms of discovery, such as depositions
and interrogatories. Prehearing discovery is not provided for under the APA and
is rarely available in administrative hearings. Full-scale discovery is
inappropriate in administrative hearings, as it would unduly delay the
streamlined administrative process. These regulations do, however, provide for
exchange of relevant and material documents, as well as the exchange of witness
lists, prior witness statements, and exhibits before the hearing, as provided
in § 160.540 of the rule.
Exchange of Witness Lists,
Statements, and Exhibits
Section 160.540 provides for the prehearing
exchange of certain documents, including witness lists, copies of prior
statements of witnesses, and copies of hearing exhibits.
Paragraph (a)
of this section differs slightly from the corresponding paragraph in §
1005.8 of the OIG regulations, in that it provides for the exchange of witness
lists, witness statements and exhibits at least 15 days before the hearing, but
also allows the ALJ to order an earlier exchange if he or she deems it
necessary.
Paragraph (b) provides that the ALJ must exclude witnesses
and documents offered by a party that did not provide those materials before
the hearing, except where there is good cause for the failure, or where there
is not substantial prejudice to the objecting party. As with the OIG
regulations, this provision is mandatory and serves to prevent the parties from
litigating by surprise and to promote the procedural regularity of the hearing.
Paragraph (b)(3) provides that where the witnesses or exhibits are not
excluded, the ALJ must recess the hearing for a reasonable time to allow the
objecting party the opportunity to prepare and respond to them, unless the
objecting party agrees to proceed. This paragraph differs from §
1005.8(b)(3) of the OIG regulations, under which the decision to postpone the
hearing is within the ALJ's discretion. This modification is equally beneficial
to both parties to a hearing and will reduce the potential for unfair surprise
during a hearing. It is preferable to the OIG provision that grants the ALJ
discretion, because it provides clear notice to the parties and clear direction
to the ALJ in the event witnesses or exhibits are not excluded.
Finally, any documents exchanged before the hearing would be deemed
authentic for purposes of admissibility at the hearing unless a party objected
to a particular document before the hearing.
Subpoenas for
Attendance at the Hearing
Section 160.542 outlines procedures for
the ALJ to issue, and for parties and prospective witnesses to contest,
subpoenas to appear at the hearing. Subpoenas are authorized by 42 U.S.C.
1320a-7a(j) and may be issued by an ALJ pursuant to 5 U.S.C. 556(c). Either
party may request that the ALJ issue a subpoena, if the appearance of a witness
and the testimony are reasonably necessary for the party's case. The subpoena
procedures here are the same as those at § 1005.9 of the OIG regulations.
Fees
Section 160.544 provides for the payment of witness
fees by the party requesting a subpoena. This section tracks § 1005.10 of
the OIG regulations.
Form, Filing, and Service of Papers;
Computation of Time
Section 160.546 sets forth requirements for
documents filed with the ALJ. Section 160.548 outlines the method for computing
time periods under this part. These provisions track, respectively, §
1005.11 and § 1005.12 of the OIG regulations.
Motions
The provisions of § 160.550 set forth requirements for the
content of motions and the time allowed for responses. This section tracks
§ 1005.13 of the OIG regulations.
Sanctions
Section
160.552 outlines the sanctions an ALJ may impose on parties and their
representatives for failing to comply with an order or procedure, failing to
defend an action, or other misconduct. These sanctions are specifically
provided for by the statutory provision at 42 U.S.C. 1320a-7a(c)(4). This
section tracks § 1005.14 of the OIG regulations.
The Hearing
Section 160.554 provides for a public hearing on the record. It
allows for the admission of rebuttal evidence not exchanged before the
hearing.
This section is based upon § 1005.15 of the OIG
regulations, which also addresses the burden of proof at the hearing, and
provides that the hearing is not limited to the items and information set forth
in the notice of proposed determination. We anticipate addressing those issues
in the notice-and-comment rulemaking that we plan for the remainder of the
Enforcement Rule.
Witnesses
Under § 160.556, the ALJ
may allow testimony to be admitted in the form of a written statement or
deposition so long as the opposing party has a sufficient opportunity to
subpoena the person whose statement is being offered. This section also allows
an HHS investigator or other expert to be a witness, in addition to assisting
counsel for the Secretary at counsel table during the hearing. These provisions
closely track § 1005.16 of the OIG regulations.
Evidence
With certain limited exceptions, the Federal Rules of Evidence are
not binding on the ALJ. However, the ALJ may apply the Federal Rules of
Evidence to exclude unreliable evidence. Section 160.558 is substantially
similar to § 1005.17 of the OIG regulations, but does not contain a
paragraph corresponding to § 1005.17(j) regarding evidence as to the
respondent's willingness and/or ability to enter into a corrective action plan.
We anticipate addressing this issue in the notice-and-comment rulemaking that
we plan for the remainder of the Enforcement Rule.
The Record
Section 160.560 provides for recording and transcription of the
hearing, and for the record to be available for inspection and copying by any
person. For good cause, the ALJ may order appropriate redactions made to the
record. These provisions track § 1005.18 of the OIG regulations.
Post-Hearing Briefs
Section 160.562 provides that the
ALJ has discretion to order post-hearing briefs, although the parties may file
post-hearing briefs in any event if they desire. This section tracks §
1005.19 of the OIG regulations.
ALJ Decision
Section
160.564 provides that not later than 60 days after the filing of post-hearing
briefs, the ALJ shall serve on the parties a decision making specific findings
of fact and conclusions of law. The ALJ's decision is the final decision of the
Secretary.
Section 1005.20 of the OIG regulations, upon which this
section is based, provides for the ALJ to issue an "initial decision," which is
then reviewable by the Departmental Appeals Board if properly appealed. We have
not provided for a second level of administrative review in this rule, and thus
this section refers to the "ALJ decision" rather than to an "initial decision."
Neither section 1320a-7a nor the APA requires a second level of administrative
review, although this is generally available in Department hearings. We
anticipate addressing the issue of further administrative review in the
notice-and-comment rulemaking that we plan for the remainder of the Enforcement
Rule.
Judicial Review; Stay of ALJ Decision
Section
160.568 provides for judicial review of penalties imposed under this part, as
authorized by 42 U.S.C. 1320a-7a(e). Section 160.570 provides that a respondent
may request a stay of the effective date of a penalty pending judicial review.
This section tracks § 1005.22(b) of the OIG regulations.
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