California Hospital Defeats $500 Million Privacy Suit

The California 4th District Court of Appeal recently ruled that a hospital did not violate medical privacy statutes when a computer was stolen in 2011.  According to the court’s opinion in Eisenhower Medical Center v. Superior Court of Riverside County, the computer, which was stolen from the medical center, contained an index of over 500,000 patients at the hospital who had been assigned a clerical record number.  The index, which had data from as far back as the 1980s, included the person’s name, medical record number, age, date of birth and the last four digits of the person’s Social Security number.  Significant to this ruling was that the file was password-protected but not encrypted.

The proposed class-action lawsuit sought over $500 million in statutory damages, or $1,000 for each of the over 500,000 patients whose personal information was listed on the index.

Following the hospital’s appeal from a dispositive motion ruling, the California appeals court held that, under these circumstances, the hospital could not be liable for violating the Confidentiality of Medical Information Act (CMIA) because it never revealed “medical information” about the listed individuals. The court held that under the CMIA, a prohibited release by a health care provider must include more than individually identifiable information but must also include information relating to medical history, mental or physical condition, or treatment of the individual.

Although this ruling helps narrow damages arising from a data breach involving medical records under the CMIA, a health care provider should bear in mind that, pursuant to this ruling, to be liable under the act, individually identifiable information – such as a patient’s address, name and email address, plus information about a patient’s “medical history, diagnosis or care” – must have been released.

To read the May 21 opinion, click here.  This ruling is final since the California Supreme Court declined to review it.

Image courtesy of Flickr by Taber Andrew Bain

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