Workplace Privacy, Data Management & Security Report : Privacy Lawyers & Attorneys : Jackson Lewis Law Firm : Data Security, HIPAA & Confidentiality Issues

The U.S. District Court for the Southern District of Ohio found the confidentiality rights of patients outweighed a plaintiff’s need to take discovery of patient medical records in Kapp v. Jewish Hospital, Inc.  Plaintiff, a former nurse, brought suit in the federal court in Ohio, alleging she was terminated in violation of federal employment discrimination laws.  Specifically, plaintiff alleged defendant had alternative motives for plaintiff’s termination, including plaintiff’s age, perceived disability, and plaintiff’s request for FMLA leave.  To establish her case, plaintiff sought to ascertain through the discovery process, whether other similarly situated nurses, were treated in a like manner.  To do so, plaintiff filed a motion to compel seeking access to non-party patient records in an attempt to discern if other nurses participated in essentially the same conduct for which defendant terminated plaintiff, but were not themselves terminated.  The Magistrate Judge denied plaintiff’s motion to compel and held that Ohio's strict physician-patient privilege law applied to prevent production of the records.  The plaintiff objected to the Magistrate Judge’s Order, and those objections were heard by the District Court Judge.  The District Court Judge held that “[a]lthough state privilege law does not control…there are abundant and adequate federal principals that protect patient confidentiality.”  The Court went on to state,

the non-party patients’ right to confidentiality outweighs the plaintiff’s proffered justification for accessing the non-party patient medical records. 

The Court went on to say that the Health Insurance Portability and Accountability Act expresses a general federal policy favoring patients' right to confidentiality and HIPAA's Privacy Rule grants federal protections for patients' personal health information held by covered entities and gives patients rights regarding that information. In this case, the plaintiff had other, less-intrusive options for discovering whether the hospital treated similarly situated nurses differently, including, for example, narrowing the scope of the request by deposing other nurses who had worked with the physician in question, the hospital's human resources personnel, or other nurse supervisors.

The broad discovery sought by plaintiff in this matter is not an uncommon approach taken by the plaintiff’s bar in an effort to prove the merits of their client’s claims.  Employers, especially those in the healthcare industry, must be aware of opinions like Kapp in their efforts to limit plaintiff’s unfounded discovery requests and to protect their patients’ privacy.  

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Connecticut joins five other states (Hawaii, Illinois, Oregon, Washington, and Maryland) in limiting what credit report information employers may use in making hiring or employment decisions. Other states have considered similar measures.

Under the new law, effective October 1, 2011, employers (including their agents, representatives or designees) may not demand that an employee or prospective employee consent to a credit report as a condition of employment unless:

1. the employer is a financial institution, 
2. the credit report is required by law,
3. the employer reasonably believes that the employee has engaged in specific activity that constitutes a violation of the law related to the employee's employment, or
4. such report is "substantially related to the employee's current or potential job" or the employer has a bona fide purpose for requesting or using information in the credit report that is substantially job-related and is disclosed in writing to the employee or applicant.

For purposes of this law, a credit report is a report that contains information about the employee's or prospective employee's credit score, credit account balances, payment history, savings or checking account balances or savings or checking account numbers. The report will be treated as being "substantially related to the employee's current or potential job," where the position:

• is a managerial position which involves setting the direction or control of a business, division, unit or an agency of a business,
• involves access to customers', employees' or the employer's personal or financial information other than information customarily provided in a retail transaction,
• involves a fiduciary responsibility to the employer, including, but not limited to, the authority to issue payments, collect debts, transfer money or enter into contracts,
• provides an expense account or corporate debit or credit card,
• provides access to certain confidential or proprietary business information, including trade secret information under certain circumstances; or
• involves access to the employer's nonfinancial assets valued at $2,005 or more, including, but not limited to, museum and library collections and to prescription drugs and other pharmaceuticals.

Employees or prospective employees who believe the law has been violated may file a complaint. Employers could be liable for $300 in civil penalties for each inquiry that violates the law.

In addition to affecting the traditional employee-employer relationship, this law (and those cited above) may affect the practice of requiring employees of a company's vendors to jump through certain hoops before coming on-site. Increasingly, company A, when it utilizes the services of employees of company B (such as for back office processing or health care staffing needs) will require company B to ensure its employees undergo certain background checks and other certification procedures and tests. Those arrangements need to consider these limitations on the kinds of inquiries that can be made by employers.

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. . . A Potential Headache for Employers of Younger Workers

Written by Lillian Moon

Retail, entertainment, hospitality and other industries that traditionally employ large numbers of younger workers may soon get dragged into criminal proceedings because of “sexting” by their younger workers. Florida has joined 20 other states — Alaska, Arkansas, California, Hawaii, Indiana, Iowa, Kansas, Mississippi, Nevada, New Jersey, New York, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Texas, and Guam — which have all enacted similar legislation addressing teen sexting. Because employees frequently transmit these materials using their employer’s networks, criminal prosecutions under these laws may require employers to respond to discovery requests and subpoenas, or permit searches pursuant to warrants obtained by law enforcement authorities, which, in turn, may unexpectedly trigger disciplinary proceedings.

On June 21, 2011, Florida Governor Rick Scott signed into law H.B.75/S.B. 888. Under this law, which will take effect beginning October 1, 2011, a minor (anyone under the age of 18) commits the criminal act of “sexting” if he or she knowingly uses a computer, cell phone, or other transmission device (1) to transmit or distribute to another minor a photograph or video of any person which depicts nudity; or (2) possesses such photograph or video which was transmitted or distributed by another minor, unless the photograph was unsolicited, the minor took reasonable steps to report the photograph or video to their legal guardian, school official, or law enforcement, and the minor did not transmit or distribute the video or photograph to a third party. A minor’s first offense is considered noncriminal and is punishable by 8 hours or community service or a $60 fine. The minor’s second offense is a misdemeanor in the first degree, punishable with imprisonment not to exceed one year or a $1,000 fine; and the minor’s third offense is a felony of third degree, punishable with up to five years’ imprisonment or a $5,000 fine.

Of course, sexting is not only an issue for minors. It is fast becoming an easy and well-utilized mechanism for sexual and other workplace harassment. Accordingly, employers should review and update their anti-harassment policies to include a prohibition of harassment via e-mail, text messaging, or use of social networking sites; and they should review their electronic communications policies to include a prohibition against using any employer-provided electronic device to transmit or retain any sexually suggestive or explicit pictures, texts, videos or any other derogatory material regarding race, ethnicity, age, disability, religion, or any other protected category. Employers should also educate and train employees on the revised policies and continue to enforce all policies in a fair and consistent manner. At the same time, employers should remain mindful of any limitations on such policies (as written or as applied) that may be imposed under the National Labor Relations Act.
 

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Disclosure to management by the company’s in-house physician of an employee’s alleged “lie” (or at least significant omission) made months earlier on a post-job offer medical questionnaire violated the Americans with Disabilities Act’s confidentiality provisions, a federal District Court in Maine held last week. Blanco v. Bath Iron Works Corp., D. Me., No. 2:10-cv-00429.

Medical professionals are becoming a fixture at many workplaces, whether they be occupational nurses or full scale on-site health clinics. As reported by the L.A. Times on July 3, 2011, 15% of U.S. companies with 500 or more employees had health centers last year, up from 11% the year before, and companies with 20,000 or more employees were even more likely to have clinics. However, having these resources on site can raise a range of workplace law risks, not the least of which concerns confidentiality.

In the Maine case, following his job offer, Mr. Blanco completed a pre-placement medical screening, which included filling out and signing a “Medical Surveillance History Questionnaire,” administered by the employer’s in-house physician. He did not reveal on that form that he had Attention Deficit Hyperactivity Disorder (ADHD). Mr. Blanco received good reviews for the first few months of his employment, but when he was moved to a different position, his performance began to wane. During a meeting with his manager, he attributed his poor performance to his ADHD and not long after requested a reasonable accommodation.

Mr. Blanco was referred to the same in-house physician who administered the Medical Surveillance History Questionnaire. Rather than explore the substance of his request, the physician interrogated Mr. Blanco concerning the ADHD omission on the Questionnaire. He explained that he did not understand the questions to ask about mental or emotional issues, such as ADHD. The physician refused to provide an accommodation, or even address the issue, and shortly after the physician informed management of Mr. Blanco’s omission from the Questionnaire, he was fired.

In refusing to dismiss Mr. Blanco’s complaint under the Americans With Disabilities Act and the state anti-discrimination law, the Court rejected two interesting arguments raised by the employer:

1. Employees that lie should not be able to get protection under the ADA’s medical information confidentiality protections; and,
2. As a policy matter, these kind of misstatements put in-house physicians “in a pickle.” The court allowed, “If the revealed condition places the employee and his co-workers at risk, the doctor’s conflicting loyalty would become a safety issue."

In each case, however, the Court said it didn’t matter to its decision that the employee may have lied on the medical questionnaire. The Court simply pointed to the statutory language, which it found clear and controlling. The court stated:

The Court agrees that whether he lied is not dispositive since the confidentiality provision does not apply only to truthful information. But this does not assist the Defendants. The ADA clearly protects the confidentiality of Mr. Blancos’ response if truthful and the ADA still protects its confidentiality if not. In other words, there is no prevarication exception to the ADA’s confidentiality mandate for employment entrance examinations, much less for information the company doctor perceives is inaccurate. It is the information, accurate or not, that the statute protects.

In response to the conflicting loyalty argument, the Court reasoned:

The brief answer, however, is that these policy arguments do not trump the statutory language. Congress, not this Court, is a policy-making body, and the Court is duty-bound to follow the law as enacted by Congress. Congress may or may not have considered whether to carve out a disclosure exception for instances where the employer concludes that the employee lied or misrepresented his pre- employment medical or mental condition. In any event, there is no such exception in the statute.

More than ever, businesses are realizing that comprehensive approaches to disability and leave management not only can mitigate compliance and litigation concerns, but also can enhance employee productivity and, therefore, profit margins. For these companies, on-site health clinics, occupational health clinics, and in-house physicians can be attractive options. However, as this case makes clear, employers need to be mindful of the workplace law risks. The ADA may be one source of such risks.

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A Missouri federal district court has ruled, in I.S. v. Washington University, that a HIPAA-covered entity's disclosure of protected information can form the basis for a state-law negligence claim.  The Court reached this holding despite the well-accepted principle there is no private cause of action under HIPAA. 

The plaintiff, I.S., was undergoing medical treatment for colon cancer at Washington University.  I.S. gave Washington University a limited authorization to disclose only the dates of her treatments in order to satisfy her employer’s medical leave requirements.  Notwithstanding this limited authorization, plaintiff asserts that Washington University also sent her employer additional medical records and information that far exceeded her authorization. These included I.S.’s HIV status, mental health issues, and insomnia treatments.  Based on that disclosure, I.S. sued Washington University for negligence per se based on a violation of HIPAA. 

Procedurally, Washington University removed the state court action to federal court and sought dismissal of the negligence per se claim, arguing that HIPAA does not create a private cause of action. 

The district court, disagreeing with Washington University, held the plaintiff’s claim could stand despite its exclusive reliance on HIPAA.   The court held that a federal statute that does not provide for a private right of action nevertheless may be a legitimate element of a state law negligence per se claim. 

Under Missouri law, among other things, the plaintiff must show:

·         a violation of a statute or ordinance occurred,

·         the plaintiff was a member of the class of people intended to be protected,

·         the injury complained of was of the type intended to protect against, and

·         the violation was the proximate cause of the plaintiff's injury.  

The Court found that I.S. had met all of the required elements of her claim and remanded the case back to state court. It held that I.S.'s claim, although premised on HIPAA, did not raise a federal question as it did not raise any compelling federal interests or present a substantial federal question.  

This case illustrates the need for HIPAA covered entities to provide training and institute policies and procedures regarding HIPAA compliance.  Here, a process for responding to requests for information would have highlighted the importance of carefully adhering to the limits of the authorization and prevented this alleged unauthorized disclosure, thus precluding I.S.’s claims.  Additionally, employers, and their counsel, must be aware that common law claims may support litigation based on HIPAA, despite the fact HIPAA itself does not provide for a private cause of action. 

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