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have been required to do for paper re- cords under state law). The state law is more stringent than the 30 days HIPAA allows. Physicians may provide the re- cord in a nonelectronic format if the pa- tient agrees. Under Texas law, when breaches of security occur, physicians must now no- tify all affected individuals, not just pa- tients who reside in Texas. If the affected person lives in another state, he or she must be notified under the requirements of that state. Ms. Hiser recommends phy- sicians facing a data breach that has an impact on patients outside Texas consult an attorney for guidance on applicable state law. “Failure to comply with state and


HIPAA notice requirements has severe penalties,” she said. Dr. Murray encourages physicians to


review their agreements with business associates. HHS reports 59 percent of all breaches in 2011 involved a business associate. “Texas’ privacy law doesn’t address who will notify patients and who will pay for associated costs when a breach occurs. Physicians should ensure that if a breach occurs on the part of the busi- ness associate, that associate notifies the physician of the breach in a timely manner. They should also determine in writing who will cover the cost of patient notification and other related expenses,” he said.


The new state privacy law also allows civil penalties up to:


• $5,000 per each negligent violation in one year;


• $25,000 per each intentional viola- tion in one year;


• $250,000 for a violation committed knowingly and intentionally that in- volves using PHI for financial gain; and


• $1.5 million if a court finds “the viola- tions have occurred with a frequency as to constitute a pattern or practice.”


To avoid violating the law and facing steep penalties, Dr. Murray advises phy- sicians to contact an attorney to ensure compliance with the new regulations and to consult their area regional exten-


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