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Avoiding Liability Bulletin – June 2006

… On March 16, 2006 the final rule on Enforcement under HIPAA became effective. This enforcement rule (federal regulation) relates not only to the Privacy Rule, but also to other rules adopted by the Secretary of the U.S. Department of Health and Human Services to implement the Administrative Simplification provisions of HIPAA (for example, the Security and Transaction Rules).

If a complaint is filed against a “covered entity” (private practitioner health care providers may or may not be a “covered entity” – depending upon whether or not they transmit any health information in electronic form in connection with specified insurance – related transactions), an investigation may begin.

Suppose that a “covered” practitioner failed to give a patient the Notice of Privacy Practices on the patient’s first visit, or perhaps the therapist or counselor failed to provide the patient with timely access to his/her mental health treatment records. If a patient were to file a complaint with the Secretary of Health and Human Services (Office for Civil Rights), it is possible that the practitioner would ultimately be assessed a fine (called a “civil money penalty”) for an alleged violation. It is also possible that the matter will be resolved amicably without the imposition of a civil money penalty, even if the practitioner did violate the Privacy Rule.

While the regulations provide for a formalized, adversarial process where a proposed civil monetary penalty is contested, the government’s general approach to complaints is that they will work with covered entities to help them achieve compliance. They will do this when the non-compliance is due to “reasonable cause” and not “willful neglect” and is corrected over a certain period of time after the covered entity knew or should have known of the compliance failure. If the violation is intentional or due to “willful neglect,” however, the government will likely pursue the civil money penalty approach. In such a case, the practitioner has specified rights, including the right to a hearing before an Administrative Law Judge (ALJ) and the right to appeal the ALJ’s decision.

Those who are “covered providers” need to have a more in depth knowledge about these recently effective federal regulations for a variety of reasons, not the least of which is to know how to navigate the system should one suddenly and unexpectedly be the subject of a complaint. Even those who are not “covered entities” should be aware of these regulations, since the government may wrongly assume or wrongly assert that one is a covered entity when in fact that is not the case. Additionally, there are some possible implications with regard to one’s licensing board, since whenever a proposed penalty is final, HHS will notify the public and the appropriate state licensing agency of the penalty and the reason why it was imposed. Finally, be mindful that your malpractice carrier may cover you for some aspect of such an investigation and proceeding by the federal government.


Richard Leslie

"At the Intersection of Law and Psychotherapy" Richard S. Leslie is an attorney who has practiced at the intersection of law and psychotherapy for the past twenty-five years. Most recently, he was a consultant to the American Association for Marriage and Family Therapy (AAMFT), where he worked with their various state divisions to develop and implement their legislative agendas. He also provided telephone consultation services to AAMFT members regarding legal and ethical issues confronting practitioners of diverse licensure nationwide. Additionally, he wrote articles regarding legal and ethical issues for their Family Therapy Magazine and presented at workshops on a variety of legal issues. Prior to his work with AAMFT, Richard was Legal Counsel to the California Association of Marriage and Family Therapists (CAMFT) for approximately twenty-two years. He was director of Government Relations for CAMFT, and as such was the architect of CAMFT’s widely regarded and successful legislative agenda. He represented CAMFT before the regulatory board (the Board of Behavioral Sciences) and was a tireless advocate for due process and fairness for licensees and applicants. He was a regular presenter at workshops and was consistently evaluated as CAMFT’s most highly rated presenter. He also sat with the CAMFT Ethics Committee and acted as their advisor on matters pertaining to the enforcement of ethical standards. Richard is an acknowledged expert on matters pertaining to the interrelationship between law and the practice of marriage and family therapy and psychotherapy. For many years, he taught Law and Ethics courses for a number of colleges and universities in their marriage and family therapy degree programs. While at CAMFT, he provided telephone consultation services with thousands of therapists in California and elsewhere for over twenty years. He is highly regarded for his judgment, his expertise, his direct style, and his clarity. Richard has been the driving force for many of the changes and additions to the laws of the State of California that affect MFTs. In 1980, he was primarily responsible for achieving passage of the "Freedom of Choice Law" that required insurance companies to pay for psychotherapy services performed by MFTs. Passage of that law allowed MFTs to earn a living, allowed them to better compete in the marketplace, and strengthened the profession in California by leading to a great increase in the number of licensees and CAMFT membership. Currently, about half of the licensed marriage and family therapists in the country are licensed in California. While at CAMFT, Richard was primarily responsible for, among other things, the successful effort to criminalize sex between a patient and a therapist. He was successful in extending the laws of psychotherapist-patient privilege to MFTs, thereby giving patients the same level of privacy protection as when seeing a psychiatrist or psychologist. He fought tirelessly and successfully for the right of MFTs to refer to themselves as "psychotherapists," to perform psychological testing services, to be appropriately reimbursed by California’s Victims of Crime Program, and to be employed in county mental health agencies throughout California. Richard was admitted to the Bar in New York (1969) and in California (1973). While practicing in New York, he served as a public defender, and later, as an Assistant District Attorney. Shortly after moving to California, he worked for the San Diego County Human Relations Commission as their Law and Justice Officer. While there, he worked successfully to achieve greater racial diversity in the criminal jury selection system and to expose and stop police abuse. For such work with that agency, he was the recipient of the Civil Libertarian of the Year Award by the San Diego Chapter of the American Civil Liberties Union.

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