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SettlementHigh RiskMultistate

NJ AG Leads Multi-State $5M Settlement with CHS for 2014 Data Breach

CHS/Community Health Systems, Inc.October 8, 2020New Jersey Attorney General

Penalty Amount

$5,000,000

Consumers Affected

6,100,000

Summary

New Jersey Attorney General settled with Community Health Systems, Inc. over a 2014 data breach affecting 6.1 million patients, including over 45,000 New Jersey residents. CHS will pay $5 million to 28 states and implement enhanced data security measures to protect personal and health information.

Remedy

CHS must pay $5 million and implement a comprehensive data security program including an incident response plan, security and privacy training for personnel, access limitations to protected health information, and policies for business associates.

Monetary PenaltyCompliance Program

Contract Impact

In-house legal teams should review all agreements involving personal health information (PHI), including vendor/business associate agreements (BAAs), patient consent forms, employment contracts for staff with data access, and any data processing agreements. Specific clauses to scrutinize are data security standards (e.g., encryption, access controls), breach notification timelines and procedures, data retention and disposal policies, audit rights for security compliance, and indemnification provisions for data breaches. Given the settlement's focus on enhanced protections, contracts may need updates to mandate specific technical safeguards (like encryption of SSNs), require regular third-party security audits, align breach notification with state laws (which may be stricter than HIPAA), and incorporate ongoing risk assessment obligations.

Contract Search Terms

HIPAA business associate agreementdata security standards clausebreach notification procedureencryption requirementsaudit rightsdata retention scheduleincident response planpatient consent formrisk assessment clauseaccess control measures

Violation Types

Entity Details

Entity

CHS/Community Health Systems, Inc.

Also known as: Community Health Systems

Industry

Healthcare

Multistate Coalition

Official Sources

Source Evidence

Entity Name
"CHS/Community Health Systems, Inc."
Fine Amount
"overall payment of $5 million"
Violation Description
"2014 data breach in which intruders copied and transferred data"

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