Business Associate or Conduit? Why a BAA likely applies to you.
Ever run into a vendor who claims to be a conduit versus a business associate (BA)? It happens all too often, in my experience. Here’s the problem: the conduit exception is a narrow one. If you’re storing PHI data, even encrypted PHI where you don’t have the encryption key, you’re a BA. Sign the Business Associates Agreement (BAA); it applies to you.
Not convinced? Let’s look at the preamble to the Omnibus Rule of 2013. HHS said, “The conduit exception is a narrow one and is intended to exclude only those entities providing mere courier services, such as the U.S. Postal Service or United Parcel Service and their electronic equivalents, such as internet service providers (ISPs) providing mere data transmission services. As we have stated in prior guidance, a conduit transports does so on a random or infrequent basis. Thus, document storage companies maintaining protected health information on behalf of covered entities are considered business associates, regardless of whether they actually view the information they hold.”
With that HHS summary in mind, you can see it’s pretty difficult to market services and storage to the healthcare industry without a BAA and think you won’t run afoul of HIPAA. Yet even as recently as a few years ago, our privacy and information security firm would encounter storage vendors and document sharing vendors who would not sign a business associate agreement. Again, just because you can’t access the PHI doesn’t mean you’re not a business associate.
In OCR’s May 2019 guidance, you’ll find a list of BA liabilities. Those remind BAs of their compliance responsibilities in regard to HIPAA regulations. OCR’s reminder list also notes that BAs have a duty to execute a business associate agreement with their BA subcontractors. What isn’t mentioned, but is required, is that covered entities (CE) and BAs must execute a BAA with each other. So if you’re not an internet service provider (ISP), or the US Postal Service (and the like), plus you store PHI, you need to execute a BAA to be in compliance with HIPAA regulatory requirements.
I’ll end with a cautionary note about vendors convinced they aren’t a business associate. Covered Entities, if your vendor is unwilling to sign a BAA, yet they have access to your PHI, it’s probably a good idea to find another vendor. It may be that your vendor who stores paper charts or other PHI doesn’t realize that they’re a business associate. Or it could be that, in the case of a storage unit, the storage facility owners simply don’t know what’s being stored. But if PHI is involved, then you need to execute a business associate agreement.
Whether you’re a physician practice, a medical transcription service, or a TPA providing a health plan with claims processing services, you’re dealing with HIPAA compliance. Give us a call: 503-384-2538 for help to assure you’re on top of it.