Continuing our thoughts on how disclosures of private or confidential information may adversely impact the institution and the persons affected by such disclosure, we now focus on something near and dear to lawyers’ hearts: paper shredding.

Many businesses regularly shred documents they no longer need to protect them from disclosure. While this may secure the information contained in those documents, an additional concern exists for HIPAA-covered entities, such as hospitals, medical providers or their business associates. Often, those documents might consist of old medical records, charts, notes, or other information containing protected health information (“PHI”) specifically protected from disclosure under HIPAA.  

Shredding frequently is done by outsourced vendors.  They shred what is provided to them and then resell it as fill, packaging material or for other recyclable-type uses. But shredding alone may not be sufficient to secure data under HIPAA. This can cause a HIPAA headache, as suggested by recent occurrences overseas.  A gift-wrapping company owner in England discovered protected health data (including names of patients) from a local hospital on the shredding she used for work. In another situation being investigated by British authorities, an outsourced medical transcription company in India disclosed shredded health data. Although those situations occurred abroad, they could just as easily happen in the U.S., or occur outside the U.S. but affect information involving U.S. citizens.

If a data breach is discovered by the unauthorized disclosure of PHI through shredding or otherwise, under the American Recovery and Reinvestment Act of 2009 (“ARRA”), covered-entities and business associates must notify those affected by the disclosure of unsecured PHI within 60 days after a breach. If the breach involves disclosure of PHI for over 500 persons, a covered-entity and/or a business associate must also notify Department of Health and Human Services and the media. “Unsecured” under ARRA means any data not rendered unusable, unreasonable or indecipherable. Thus, an individual’s name legible on a snippet of shredded paper together with some health information may be enough to trigger ARRA’s disclosure requirements and constitute a HIPAA violation. For more information about data breaches under HIPAA, click here.

We therefore remind HIPAA-covered entities to ensure that their vendors are compliant with the HIPAA security requirements, that they have appropriate business associate agreements where necessary, and that they actively monitor compliance with those agreements.