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Data breaches are running at record levels, according to the San Diego-based Identity Theft Resource Center, a non-profit that tracks cybercrime. ITRC says it recorded 342 data breaches from Jan. 1 through June 24, up 69% from the same period in 2007. But, like the origins and perpetrators of so many individual data breaches, mystery also lies behind the aggregated numbers. "I'm not sure that this says breaches are increasing," ITRC founder Linda Foley tells Digital Transactions News. "What we know is the reporting of breaches is increasing." A handful of states now require some disclosure of data breaches to authorities, Alaska being the most recent. And some companies that have been hacked are starting to report breaches voluntarily, Foley says. While data breaches can compromise all manner of personal and business records, they often involve credit and debit card data and bank-account information. ITRC lists five major categories of breached entities, with the so-called banking/credit/financial sector accounting for 10% of 2008's breaches. Businesses, which include physical and Internet retailers, insurance companies and other private enterprises, accounted for 36.8%. Schools accounted for 21.3%; government and military facilities, 17%; and health-care facilities, 14.9%. IRTC also categorizes breaches by how they happened, such as through hackings-break-ins into computers and related systems, insider thefts, data lost in physical transit, and by other methods. The number of 2008 hackings through late June in the banking/credit/financial category was 10-double the five for all of 2007. The estimated number of records compromised as a result was 227,864. In 2007, the reported number of compromised records at financial institutions through hackings was 83,500. But Foley says not to put too much stock in the records numbers because so many breached organizations don't know or fail to report the number of compromised records when they report a bre

Don't underestimate the maddening complexity and considerable costs of digitizing health care records and processes. That was the overarching message from a dozen or so health care players, some of them doctors, following my recent column urging the industry to bring its IT practices into the 21st century. A few readers took issue with my labeling health care practitioners as "laggards." In fact, argues Dr. Daniel Essin, former director of medical informatics at Los Angeles County + USC Medical Center, "physicians are, and have always been, early adopters of technology." Essin, who's now chairman of an electronic medical records vendor, ChartWare, says many physicians have made multiple attempts to implement EMRs but failed. He cites six main reasons: * They can't articulate a set of requirements against which products can be judged. * EMR systems aren't flexible enough, requiring workarounds even before their implementation is complete. * There's a mismatch between the tasks products are expected to perform and the products' actual functionality. * Some systems are conceived as a "simple" add-on to the billing system. * System workflows consume way too much physician time and attention. * There isn't adequate integration between internal and external systems. Related to most of those obstacles is cost. One EMR kit at the entry level, offered by Wal-Mart's Sam's Club unit in partnership with Dell and eClinicalWorks, is priced at around $25,000 for the first physician and $10,000 for each additional one. After installation and training, annual maintenance and support costs are estimated at $4,000 to $6,500. That's still not chump change, especially for the smallest practices.

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In May 2008, the Office of the National Coordinator for Health Information Technology (ONC) awarded an approximately $450,000 contract to Booz Allen Hamilton to assess and evaluate the scope of the medical identity theft problem in the U.S. Medical Identity Theft Medical identity theft is a specific type of identity theft which occurs when a person uses someone else's personal health identifiable information, such as insurance information, Social Security Number, health care file, or medical records, without the individual's knowledge or consent to obtain medical goods or services, or to submit false claims for medical services. There is limited information available about the scope, depth, and breadth of medical identity theft. Dr. Robert Kolodner, National Coordinator for Health Information Technology, has noted that medical identity theft stories are being documented at an increasing rate, bringing to light serious financial, fraud, and patient care issues. ONC recognizes that health IT is an important tool to combat the threat of medical identity theft. We are seeking input from the public and other government agencies to better understand how health IT can be utilized to prevent and detect medical identity theft as well as build consumer trust in electronic health information exchange. ONC believes it is imperative to obtain a more comprehensive understanding of this issue from a variety of perspectives, and to create an open forum for dialogue to work proactively to address medical identity theft. Medical Identity Theft final report. The report summarizing health IT and medical identity theft issues raised at the town hall was completed January 15, 2009 and sets forth potential actions the Federal government and other stakeholders can undertake in working toward prevention, detection, and remediation of medical identify theft.

President-elect Barack Obama has promised to computerize all of America's medical records within five years. He made the pledge last week in a speech at George Mason University. "This will cut waste, eliminate red tape and reduce the need to repeat expensive medical tests," he said. "But it just won't save billions of dollars and thousands of jobs, it will save lives by reducing the deadly but preventable medical errors that pervade our health care system." But the road to digitized medical records will be a tough and expensive one, CNN Money reported. Today, only about 8% of the country's 5,000 hospitals and 17% of its 800,000 physicians use electronic medical records. There is also the issue of patient privacy. Numerous hospitals have faced security issues since moving to electronic medical records. The Industry Standard reported on a security breach at a Los Angeles hospital last month. And then there is the cost. Studies done by Harvard, RAND and the Commonwealth Fund peg the cost of the digitization plan between at least $75 billion to $100 billion, according to the CNN article. However, the health care industry spends $2 trillion dollars a year, so the $100 billion may be well worth the long-term savings.

LOS ANGELES-Fifteen hospital workers have been fired and another eight disciplined for looking at medical records of octuplet mother Nadya Suleman without permission, hospital officials said Monday. Kaiser Permanente reported the violations of health care privacy laws to the state and has warned employees at its Bellflower facility to keep away from Suleman's records unless they have a medical purpose, said hospital spokesman Jim Anderson. "Despite the notoriety of this case, to us this person is a patient who deserves the privacy that all our patients get," Anderson told The Associated Press. Anderson would not elaborate on how the other eight employees were reprimanded, saying only that the punishments were significant. A similar privacy breach at UCLA hospitals led to celebrities' medical information getting leaked to tabloids in recent years, including details of Farrah Fawcett's cancer treatment showing up in the National Enquirer. Anderson said Kaiser does not believe any of Suleman's information was shared with the media, based on the results of their inquiry. The 33-year-old single mother of 14 gave birth to her octuplets on Jan. 26 at Kaiser's hospital in Bellflower, about 17 miles southeast of Los Angeles. Her attorney Jeff Czech said Suleman does not plan to file a lawsuit, though he suspects Kaiser employees were looking for medical information on Suleman's sperm donor. He said the name is not listed on the Advertisement medical records. "She trusts Kaiser and they said they'd look into it," Czech said. "We feel that they're on top of it and are taking care of it." Anderson could not provide details about when Suleman's medical records were accessed and by what kind of hospital employee. He said Kaiser had warned its employees about patient confidentiality rules before Suleman checked into the hospital in December. "Even though no one knew she was there, they knew she was going to have a lot of babies," Anderson said. "The extra monitoring he

The US government has now adopted a policy of fostering the adoption of electronic medical records (EMR). The policy is intended to increase the efficiency of the US healthcare system, thereby lowering costs and reducing the incidence of preventable errors. At the same time, through its The Health Insurance Portability and Accountability Act (HIPAA) privacy rules, the government has set minimum standards for the security of those records. These two goals-privacy and security of these records, along with their free interchange among medical providers-can easily wind up at odds with each other. A recent study that looked at the role of state privacy laws in EMR adoption suggests that the problem is very real, as state privacy laws seem to inhibit the use of EMR by hospitals located there. The authors, based at MIT and the University of Virginia, line up a variety of data that validate their suggestion that privacy and the use of EMR may require a careful balance. So, for example, they cite some highly publicized lapses when it comes to the maintenance of patient privacy: someone once offered the records of 200,000 patients for sale on Craigslist, while hospitals have seen their own employees attempt to get at the electronic files of famous patients. Perhaps more significantly, the authors suggest that the public, as represented by their legislators, has concerns about the privacy of EMR. They found that states that have passed their own privacy laws to supplement the HIPAA rules tend to have a higher percentage of their populace signed up for the Do Not Call Registry, indicating a corresponding individual-level interest in maintaining privacy. So, they looked at whether these laws had any impact on the adoption of EMR by hospitals located in each state.

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Late last month, the House passed an economic recovery package containing $20 billion for health information technology, which would require the Department of Health and Human Services to develop standards by 2010 for a nationwide system to exchange health data electronically. The version of the recovery package passed by the Senate yesterday contains slightly less funding for health information technology ("health IT"). But as Congress moves to reconcile the two stimulus packages, conservatives have begun attacking the health IT provisions, falsely claiming that they would lead to the government "telling the doctors what they can't and cannot treat, and on whom they can and cannot treat." The conservative misinformation campaign began on Monday with a Bloomberg "commentary" by Hudson Institute fellow Betsy McCaughey, which claimed that the legislation will have the government "monitor treatments" in order to "'guide' your doctor's decisions." McCaughey's imaginative misreading was quickly trumpeted by Rush Limbaugh and the Drudge Report, eventually ending up on Fox News, where McCaughey's opinion column was described as "a report." In one of the many Fox segments focused on the column, hosts Megyn Kelly and Bill Hemmer blindsided Sens. Arlen Specter (R-PA) and Jon Tester (D-MT) with McCaughey's false interpretation, causing them to promise that they would "get this provision clarified." On his radio show yesterday, Limbaugh credited himself for injecting the false story into the stimulus debate, saying that he "detailed it and now it's all over mainstream media."

Last week, President Barack Obama convened a health-care summit in Washington to identify programs that would improve quality and restrain burgeoning costs. He stated that all his policies would be based on rigorous scientific evidence of benefit. The flagship proposal presented by the president at this gathering was the national adoption of electronic medical records -- a computer-based system that would contain every patient's clinical history, laboratory results, and treatments. This, he said, would save some $80 billion a year, safeguard against medical errors, reduce malpractice lawsuits, and greatly facilitate both preventive care and ongoing therapy of the chronically ill. Following his announcement, we spoke with fellow physicians at the Harvard teaching hospitals, where electronic medical records have been in use for years. All of us were dumbfounded, wondering how such dramatic claims of cost-saving and quality improvement could be true. The basis for the president's proposal is a theoretical study published in 2005 by the RAND Corporation, funded by companies including Hewlett-Packard and Xerox that stand to financially benefit from such an electronic system. And, as the RAND policy analysts readily admit in their report, there was no compelling evidence at the time to support their theoretical claims. Moreover, in the four years since the report, considerable data have been obtained that undermine their claims. The RAND study and the Obama proposal it spawned appear to be an elegant exercise in wishful thinking. To be sure, there are real benefits from electronic medical records. Physicians and nurses can readily access all the information on their patients from a single site. Particularly helpful are alerts in the system that warn of potential dangers in the prescribing of a certain drug for a patient on other therapies that could result in toxicity. But do these benefits translate into $80 billion annually in cost-savings? The cost-savings from avoi

A rule requiring healthcare providers, health plans, and other entities covered by the Health Insurance Portability and Accountability Act (HIPAA) to notify individuals of a breach of their unsecured protected health information will become effective September 23, 2009. The "breach notification" regulations implement provisions of the Health Information Technology for Economic and Clinical Health (HITECH) Act, which was part of the American Recovery and Reinvestment Act of 2009 (ARRA). The new "breach notification" regulations apply to HIPAA-covered entities and their business associates. HIPAA covered-entities include health plans, healthcare clearinghouses, and healthcare providers. A business associate is a person or entity (such as a healthcare benefits broker) who, on behalf of the covered entity, performs a function involving the use or disclosure of individually identifiable health information.

Hackers, possibly from Asia, have stolen about a decade's worth of personal information on current and former UC-Berkeley students, the university announced Friday. The breaches involved records dating to 1999 at the school's health center that included Social Security numbers, health insurance information, immunization history and the names of treating physicians. No other treatment-related records were stolen, the university said, although self-reported medical histories of students who studied abroad were hacked. The school on Friday sent e-mails and letters to 160,000 people, including about 3,400 Mills College students who used or were eligible for University of California-Berkeley medical services. About 97,000 people are most at risk because their names and Social Security numbers could be connected by the hackers, said Steve Lustig, the university's associate vice chancellor for health and human services. "What's been taken is bits of data that the thief might put together into an identity," he said. The university traced the hackers back to Asia, possibly China, but the exact origin could not be pinpointed. UC and FBI investigators are probing the breaches, which apparently occurred over several months. An FBI spokesman said the agency was informed of the hacking immediately, but declined to provide more information. The thefts were discovered about a month ago, but system administrators did Advertisement not realize the breadth of the attack until April 21. The hackers disguised their work as routine operations and then left taunting messages for UC-Berkeley employees, said Shelton Waggener, the university's associate vice chancellor for information technology. The thieves accessed the information through the university Web site, he said. "You should think of it as a public building," Waggener said. "They got into the building properly, but then they broke into secure areas." Administrators at Mills College, which contracts with UC-Berkeley for

The Kaiser Permanente hospital in Bellflower has been hit with a $187,500 fine for failing for a second time to prevent unauthorized access to confidential patient information, state pubic health officials said today. [Updated at 3 p.m.: A spokesman for the hospital said the fine was part of the ongoing investigation into employees improperly accessing the medical records of Nadya Suleman and her children. Disciplinary action has been taken against the employees, said Jim Anderson, a hospital spokesman. All the incidents occurred in January; a previous post said they had occurred in April and May.] State officials said Kaiser Permanente Bellflower Medical Center compromised the privacy of four patients when eight employees improperly accessed records. This is the second penalty against the hospital, officials said. The hospital was fined $250,000 in May for failing to keep employees from snooping in the medical records of Nadya Suleman, the woman who set off a media frenzy after giving birth to octuplets in January. The fine was the first penalty imposed and largest allowed under a new state law enacted last year after the widely publicized violations of privacy at UCLA Medical Center involving Farrah Fawcett, Britney Spears, California First Lady Maria Shriver and other celebrities. "We are very concerned with violations of patient confidentiality and their potential harm to the residents of California," said Dr. Mark Horton, director of the California Department of Public Health. "Medical privacy is a fundamental right and a critical component of quality medical care in California."

With identity theft on the upswing, Aram Langhans thought he was simply being prudent when he asked the Yakima Heart Center to remove his Social Security number from its files. "They had my insurance card and my driver's license. What else did they need?" said Langhans, a retired public school teacher insured by Group Health. Langhans said he was initially hooked up to a portable heart monitor that he was to wear for 24 hours, but the disagreement over his Social Security number prompted upper-level personnel to change their minds. He said moments after the device was attached, he was sent to a restroom to remove it and turned away. Shawnie Haas, administrator of the Heart Center, an independent outpatient group practice, declined to discuss the incident. But she said in an e-mail statement that the practice protects patients' privacy. "The Yakima Heart Center is careful to collect data pertinent to ensuring accuracy of our patient's medical record. Routine information collected for all patients includes name, address, date of birth, Social Security number, gender, and other specific information that helps us verify that individual's identity and insurance enrollment or coverage data. We are careful to maintain confidentiality of all patient information in our system." According to state and federal regulators, private insurance companies have moved away from using Social Security numbers for patient identification. But health-care providers in the Yakima Valley say they routinely collect them as "backup" in the event that patients' insurance doesn't pay the claim.

In a study that is unlikely to find favor among privacy advocates, researchers from two academic institutions warned that increased efforts to protect the privacy of health data will hamper the adoption of electronic medical records systems. The study, conducted by researchers at MIT and the University of Virginia, said EMR adoption is often slowest in states with strong regulations for safeguarding the privacy of medical records. On average, the number of hospitals deploying EMR systems was up to 30% lower in states where health care providers are forced to comply with strong privacy laws than it was in states with less stringent privacy requirements. That's because privacy rules often made it harder and more expensive for hospitals to exchange and transfer patient information, thereby reducing the value of an EMR system, the study found.

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Last week, the government took another step toward closing a legal loophole in federal privacy and security rules for emerging Health 2.0 information technology applications by issuing proposed rules aimed at covering an estimated 900 companies and organizations offering personal health records and electronic systems connected to them. The Federal Trade Commission was careful to point out its new interim proposed rule on federal breach notification requirements for the developers of electronic PHR systems did not apply to covered organizations or their business associates as defined by the Health Insurance Portability and Accountability Act of 1996, heretofore the key federal privacy and security regulation. The FTC, operating under new authority given it by the American Recovery and Reinvestment Act of 2009, noted that its new rule seeks to cover previously unregulated entities that are part of a Health 2.0 product mix. FTC staff estimates that about 200 PHR vendors, another 500 related entities and 200 third-party service providers will be subject to the new breach notification rule. The staffers estimate that the 900 affected companies and organizations, on average, will experience 11 breaches each per year at a total cost of about $1 million per group, per year. Costs include investigating the breach, notifying consumers and establishing toll-free numbers for explaining the breaches and providing additional information to consumers. Pam Dixon, founder and executive director of the World Privacy Forum, said that this isn't the first involvement of the FTC in healthcare-related regulation, noting the consumer protection agency joined with the Food and Drug Administration in a joint statement on the marketing of direct-to-consumer genetic tests. The FTC also has worked in the field of healthcare competition. She noted the compliance deadline with the FTC's "red flag rules" on provider organizations that provide consumer credit to patients for installment payment

Privacy and civil liberties advocates are urging lawmakers working on the forthcoming economic stimulus package to ensure that any language to spur adoption of electronic medical records includes meaningful security safeguards. The American Civil Liberties Union, Consumer Action, the National Association of Social Workers, Patient Privacy Rights and others sent letters to House Speaker Nancy Pelosi, Senate Majority Leader Harry Reid and President-elect Barack Obama Wednesday asking them to ensure individuals can control the use of their medical records and protect them from what they believe is a thriving industry of firms that share and sell medical data. "We all want to innovate and improve health care, but without privacy our system will crash as any system with a persistent and chronic virus will," Patient Privacy Rights executive director Ashley Katz said at a Capitol Hill briefing. Katz said her group has been pleased with progress that the House Energy and Commerce, and Ways and Means committees made last year.

Four HIV-positive patients whose records were left behind on an MBTA train by a Massachusetts General Hospital employee are suing the hospital, claiming their privacy has been breached. In March the hospital notified 66 patients who received care at its Infectious Disease Associates outpatient practice that billing records bearing their names, Social Security numbers, doctors, and diagnoses had been lost by a manager who was riding the Red Line. She had brought the paperwork home for the weekend, but left it on the train when she returned to work the morning of Monday, March 9, according to hospital security reports. Last week two patients who are HIV-positive filed a suit in Suffolk Superior Court against the hospital and the unidentified billing manager. The unnamed plaintiffs have been joined by two other HIV-positive people. The legal action was first reported in the weekly newspaper Bay Windows. Their lawyer, John Yasi of the Salem law firm Yasi and Yasi, said in an interview he has filed a motion to make the suit a class action that could cover all 66 patients, a significant number of whom are also HIV-positive. "The damages that jump out are the emotional distress surrounding the loss of obviously very sensitive medical information and secondarily the loss of personal security information," he said. "A Social Security number in reality may lead to identity theft, which we all know is a nightmare."

"Drug store chain Walgreens now enables its pharmacy patients to download their prescription history from the Walgreens.com Web site to a personal health record on the Microsoft HealthVault platform. The Deerfield, Ill.-based chain announced last June it would link to HealthVault. Patients registered on Walgreens' site already can access their complete prescription history. Now, that history can also reside in a HealthVault PHR and be automatically updated. Patients can enroll with HealthVault directly from the Walgreens site. The partnership will promote stronger collaboration among patients, pharmacists, physicians and other providers, says Don Huonker, senior vice president of health care innovation at Walgreens. More information is available at walgreens.com/pharmacy and healthvault.com. "

Think twice before giving MicroSoft your personal health care information.

Following complaints from Republicans, the White House has shut down a two-week-old e-mail tip line launched to take reports from citizens of "disinformation about health insurance reform." "An ironic development is that the launch of an online program meant to provide facts about health insurance reform has itself become the target of fear-mongering and online rumors that are the tactics of choice for the defenders of the status quo," wrote White House new media director Macon Phillips in announcing the change. "The White House takes online privacy very seriously," he added. The e-mail tip line, flag@whitehouse.gov, was launched Aug. 4 as part of the White House's Health Insurance Reform Reality Check effort, a campaign-style rapid-response effort reminiscent of the war room Obama for America launched in the summer of 2008 to fight online rumors about the then-senator's patriotism and religion. But coming from the head of state, rather than a political candidate, the new effort quickly sparked concern among Republicans about the propriety of government collecting information on private citizens' political speech.

The Federal Trade Commission today approved a final consent order settling claims that CVS Caremark violated customers' privacy and the Health Information Portability and Accountability Act (HIPAA) when it failed to dispose of records properly last year. Earlier this year, CVS Caremark agreed to settle FTC charges that it failed to take reasonable and appropriate security measures to protect the sensitive financial and medical information of its customers and employees, in violation of federal law. In a separate but related agreement, the company's pharmacy chain also has agreed to pay $2.25 million to resolve Department of Health and Human Services allegations that it violated HIPAA regulations. "This is a case that will restore appropriate privacy protections to tens of millions of people across the country," said FTC chairman William Kovacic following the settlement. "It also sends a strong message to other organizations that possess consumers' protected personal information. They are required to secure consumers' private information." Under the final consent order, CVS Caremark is required to rebuild its security and confidentiality program, which will be audited every two years for the next 20 years. The HHS settlement requires the company to develop a new training program to instruct employees on how to handle patient data.

Healthcare organizations are losing more than just names, addresses and Social Security numbers. When their data gets stolen, patients lose the privacy of their medical conditions, treatments and medications while at the same time falling prey to identity theft, medical billing fraud and other criminal schemes. Theft of electronic medical records is on the rise, and the implications are getting more serious. In a 2008 survey of identity theft victims, the Identity Theft Resource Center found that 67% had been charged for medical services they never received and 11% were denied health or life insurance due to unexplained reasons.