Update on Budget Cuts: Following a $4 million increase (10%) in its 2017 budget to $43 million, OCR is facing a $5 million cut to $38 million in 2018…and with President Trump’s most recent proposal, that amount could be cut to $33 million. With a possible 9% cut in staff, some speculate that HIPAA (and civil rights) investigations will decrease. Of course, fines and penalties resulting from HIPAA investigations go into OCR’s coffers, but one-time payments aren’t consistent enough to be adding staff. Former regulator at HHS, Adam Greene now with Davis Wright Tremaine suggests that while hiring full-time employees might not be wise, hiring contractors might be. Stay tuned, Congress has yet to weigh in.
Update on OCR Phase 2 Audits: I don’t know how I missed this, but Deven McGraw speaking in February about the status of Phase 2 desk audits, had this to say: "We have delayed when we are going to start the onsite audits. We have decided that it makes a lot more sense to [first] take a look at all we had in the desk audit process and even prepare the overarching report to the public about how those desk audits went." Ms McGraw went on to say that onsite audits might slip into 2018, although they are still hoping for a late 2017 start. According to one of our customers, some of the Covered Entities that were subject to desk audits in 2016 still have not heard from OCR on their submissions.
Update on New Director at OCR: Newly appointed Secretary of HHS, Tom Price, named Roger Severino as the new Director of OCR in April. Not unlike Leon Rodriguez and Jocelyn Samuels that came before him, Mr. Severino has been working in the Department of Justice’s Civil Rights Division. He previously worked as COO and legal counsel for the Becket Fund for Religious Liberty. In his first 6 weeks, Mr. Severino signed five (5) settlement agreements totaling $5.7 million in fines. Of course, investigations and settlements take months, if not years, to bring to a close, yet the decision to finalize these cases so early in his tenure may be an indication of his commitment to enforcement as patients’ privacy and the security of their information remain at the forefront of concerns by Democrats and Republicans alike.