What are Workforce Sanctions Policies Under the HIPAA Security Rule?

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According to an October 2023 OCR Cybersecurity Newsletter, an organization’s sanction policies can be an important tool for supporting accountability and improving cybersecurity and data protection. Sanction policies can be used to address the intentional actions of malicious insiders, such as the stealing of data by identity theft rings, as well as workforce member failures to comply with policies and procedures, such as failing to secure data on a network server or investigate a potential security incident.

The HIPAA Security Rule requires covered entities and business associates to "Apply appropriate sanctions against workforce members who fail to comply with the security policies and procedures of the covered entity or business associate."

What are the Functions of a Sanctions Policy?
Having effective written sanction policies can improve a covered entity's or business associate's compliance with the HIPAA Security Rule. Imposing consequences on workforce members who violate a regulated entity’s policies or the HIPAA Rules can be effective in creating a culture of HIPAA compliance and improved cybersecurity because of the knowledge that there is “a negative consequence to noncompliance enhances the likelihood of compliance."

Training workforce members on a regulated entity’s sanction policy can also promote compliance and greater cybersecurity vigilance by informing workforce members in advance which “actions are prohibited and punishable. A sanction policy that clearly communicates a regulated entity’s expectations should ensure that workforce members understand their individual compliance obligations and consequences of noncompliance."

Content: What Should a Sanction Policy Look Like?

Because covered entities and business associates “are so varied in terms of installed technology, size, resources, and relative risk, the Security Rule allows for a flexibility of approach to achieve compliance. This flexibility of approach also extends to Security Rule sanction sanction policies. As noted in the preamble to the Security Rule, regulated entities “have the flexibility to implement the standard in a manner consistent with numerous factors, including such things as, but not limited to, their size, degree of risk, and environment.”

The Security Rule does not require covered entities or business associates to impose any specific penalty for any individual violation or to implement any particular sanction methodology. Rather, in any individual case “[t]he type and severity of sanctions imposed, and for what causes, must be determined by each covered entity [or business associate] based upon its security policy and the relative severity of the violation.”

Covered entities and business associates may structure their sanction policies in the manner most suitable to their organization. Regulated entities may want to consider the following when drafting or revising their sanction policies:

• Documenting or implementing sanction policies pursuant to a formal process.
• Requiring workforce members to affirmatively acknowledge that a violation of the organization’s HIPAA policies or procedures may result in sanctions.
• Documenting the sanction process, including the personnel involved, the procedural steps, the time period, the reason for the sanction(s), and the final outcome of an investigation. NOTE: These records should be retained for at least six years.
• Creating sanctions that are “appropriate to the nature of the violation.
• Creating sanctions that “vary depending on factors such as the severity of the violation, whether the violation was intentional or unintentional, and whether the violation indicated a pattern or practice of improper use or disclosure of protected health information.
• Creating sanctions that range from a warning to termination.
• Providing examples of potential violations of policy and procedures.

By making these considerations, covered entities and business associates can create a thoughtful and well-documented sanction policy that informs workforce members of expectations, deters misconduct, and promotes HIPAA compliance through greater understanding and transparency of the policies and procedures that protect the security of PHI.

Execution: Sanctioning Consistently

How a HIPAA-covered entity implements its sanction policy is just as important as the policy’s content. It is important for a HIPAA-covered entity to consider whether its sanction policies align with its general disciplinary policies, and how the individuals or departments involved in the sanction processes can work in concert, when appropriate. HIPAA-covered entities may also want to consider how sanction policies can be fairly and consistently applied throughout the organization, to all workforce members, including management.