Subcontractors can be considered business associates under HIPAA if they handle protected health information (PHI) as part of their services. If the subcontractor uses PHI to perform tasks, they must comply with HIPAA regulations and therefore must enter into a business associate agreement (BAA), which outlines their responsibility to protect patient data.
Understanding key terms
The HHS defines a business associate as "a person or entity that performs certain functions or activities that involve the use or disclosure of protected health information on behalf of, or provides services to, a covered entity." Business associates may include billing companies, IT support services, cloud storage providers, or any other vendor directly contracted by a covered entity.
Subcontractors, on the other hand, are individuals or entities hired by a business associate to perform specific tasks involving the handling of PHI. These tasks could range from data storage to backup services. Essentially, subcontractors work for business associates and are part of the service chain.
Related: How to know if you’re a business associate
The relationship between business associates and subcontractors
A business associate agreement (BAA) is a legally binding document establishing the terms under which a business associate will handle PHI and ensures compliance with HIPAA’s Privacy and Security Rules.
BAAs outline the responsibilities of business associates in safeguarding PHI. They are designed to ensure that PHI is protected per HIPAA standards. The BAA typically includes provisions for PHI protection, reporting breaches, and compliance with HIPAA rules. Subcontractors are hired by business associates and may perform tasks impacting the security and privacy of PHI.
Read more: FAQs: Business associate agreements (BAAs)
Compliance requirements for subcontractors
Subcontractors, as business associates under HIPAA, must adhere to both the Privacy and Security Rules. The Privacy Rule requires that PHI be protected and only used or disclosed under certain conditions. Meanwhile, the Security Rule requires PHI to be safeguarded through appropriate administrative, physical, and technical measures. Subcontractors are obligated to implement these security and privacy protections in their operations. Additionally, subcontractors must comply with breach notification requirements and must report breaches promptly. These responsibilities must be detailed in the BAA.
Practical implications for healthcare organizations
Managing subcontractors
Healthcare organizations should vet subcontractors for HIPAA compliance by reviewing their policies, security measures, and previous compliance history. Regular audits and reviews can help verify that subcontractors meet their compliance obligations. Healthcare organizations may need to check the subcontractor’s security practices, review breach reports, and ensure they are following the terms of the BAA.
Risk management
Inadequate compliance by subcontractors can lead to significant risks, including data breaches and legal liabilities. Healthcare organizations must proactively manage these risks by enforcing stringent compliance measures and communicating with their business associates. Developing a robust risk management plan that includes monitoring subcontractor activities, maintaining BAAs, and providing ongoing training can help mitigate potential issues.
FAQs
Can a subcontractor have direct liability under HIPAA?
Yes, subcontractors can face direct liability under HIPAA if they fail to comply with the regulations governing the handling of PHI. They must follow the same privacy and security requirements as business associates.
What should a business associate do if a subcontractor breaches PHI?
The business associate must ensure the subcontractor promptly reports the breach and works with them to address the issue, notify affected individuals, and mitigate any harm, as outlined in their BAA.
Are subcontractors required to undergo HIPAA training?
Subcontractors should receive HIPAA training to understand their responsibilities regarding PHI protection and compliance with HIPAA regulations, as part of their contractual obligations.
Related: HIPAA Compliant Email: The Definitive Guide.
Liyanda Tembani
