HIPAA Compliance for Employers: What You Need to Know

theunitconsulting

October 14, 2024

Quick Summary:

HIPAA does not typically apply directly to employers, but it does affect employer-sponsored health plans.
Protected Health Information (PHI) is regulated under HIPAA when handled by covered entities like health plans, not employers themselves.
Employee health information held by employers (like sick leave notes or medical leave forms) is generally not subject to HIPAA but must be kept confidential under other laws.
Employers should safeguard health information by limiting access, securing records, and maintaining confidentiality to comply with laws like ADA and GINA.
The Unit Consulting can assist your business in developing policies and training to handle employee health information appropriately.

As an employer in Texas, you may wonder how the Health Insurance Portability and Accountability Act (HIPAA) affects your business. While HIPAA primarily regulates healthcare providers and health plans, certain aspects of the law do impact employers, especially concerning the handling of employees’ health information. Understanding HIPAA compliance for employers is crucial to protect your business and your employees’ privacy.

When Does HIPAA Apply to Employers?

Generally, HIPAA’s Privacy Rule does not apply directly to employers. It governs covered entities, which include health plans, healthcare clearinghouses, and healthcare providers that conduct certain transactions electronically. However, employers can become involved with HIPAA in specific situations:

Employer-Sponsored Health Plans

If you sponsor a group health plan for your employees, the plan itself is considered a covered entity under HIPAA. While the employer is not the covered entity, any health information you receive as part of administering the plan is subject to HIPAA regulations.

Group Health Plans: Medical, dental, vision, and prescription drug plans fall under HIPAA.
Third-Party Administrators: If you use an external company to manage your health plan, they are also bound by HIPAA.

Access to Protected Health Information (PHI)

Protected Health Information (PHI) includes any individually identifiable health information transmitted or maintained in any form. Employers may encounter PHI in scenarios such as:

Wellness Programs: If your company offers wellness programs that collect health information.
Medical Leave Requests: When processing Family and Medical Leave Act (FMLA) documentation.
Workers’ Compensation Claims: Managing injury reports and related medical records.

Handling Employee Health Information

Even when HIPAA doesn’t apply, employers must handle employee health information carefully to comply with other laws like the Americans with Disabilities Act (ADA) and the Genetic Information Nondiscrimination Act (GINA).

Best Practices for Employers

Limit Access: Restrict who can view sensitive health information within your organization.
Secure Storage: Keep physical and electronic records in secure locations with appropriate safeguards.
Confidential Communication: Ensure that discussions about an employee’s health are private and only involve necessary parties.
Employee Training: Educate your staff on the importance of confidentiality and proper handling of health information.

Disclosures Permitted Under HIPAA

There are circumstances where covered entities can disclose PHI to employers without violating HIPAA:

Workplace Safety: Information needed for compliance with Occupational Safety and Health Administration (OSHA) regulations.
Sick Leave Verification: Minimal necessary information to verify sick leave or workers’ compensation claims.
Public Health Activities: Reporting of certain health information for public health purposes.

For detailed guidelines, refer to the U.S. Department of Health & Human Services.

Common Misconceptions About HIPAA and Employers

Many employers mistakenly believe that any health information they handle falls under HIPAA. Clarifying these misconceptions is essential:

Employer Records vs. Health Plan Records: Health information in employer records is generally not covered by HIPAA, but it may be protected under other laws.
HIPAA and Supervisors: Supervisors receiving health information directly from an employee are not bound by HIPAA but should maintain confidentiality under employment laws.
Using PHI for Employment Decisions: Employers should avoid using health information in a way that could be discriminatory.

Legal Consequences of Mishandling Health Information

Failure to properly handle employee health information can result in:

Legal Penalties: Violations of ADA, GINA, or other employment laws can lead to fines and lawsuits.
Employee Trust Issues: Mishandling sensitive information damages trust and can affect morale.
Reputational Damage: Publicized breaches of confidentiality can harm your company’s reputation.

Strengthen Your HIPAA Compliance with Expert HR Support From The Unit Consulting

Navigating the complexities of HIPAA compliance for employers can be challenging. At The Unit Consulting, we specialize in helping Texas businesses understand their obligations and implement effective strategies for handling employee health information.

Our services include:

Policy Development: Crafting clear policies that outline how health information is managed within your organization.
Employee Training: Providing training programs to educate your staff on confidentiality and compliance requirements.
Risk Assessments: Evaluating your current practices to identify potential vulnerabilities.
Ongoing Support: Offering guidance on updates to laws and regulations that may impact your business.

Protect your business and your employees’ privacy. Contact The Unit Consulting today to ensure your organization is fully compliant and equipped to handle sensitive health information responsibly.