On October 7, 2016, the U.S. Department of Health and Human Services' Office for Civil Rights (OCR) published guidance to assist cloud service providers (CSPs) and their customers with HIPAA compliance. As discussed below, the guidance clarifies important questions about operating in the cloud, including the role of encryption when determining whether a cloud service provider is a business associate.
In its introduction, OCR articulates a basic principle of HIPAA applicability in the realm of cloud computing:
When a covered entity engages the services of a CSP to create, receive, maintain, or transmit ePHI (such as to process and/or store ePHI), on its behalf, the CSP is a business associate under HIPAA. Further, when a business associate subcontracts with a CSP to create, receive, maintain, or transmit ePHI on its behalf, the CSP subcontractor itself is a business associate.
The guidance then addresses the effect of encryption on the application of HIPAA to cloud providers. In the past, some CSPs have questioned whether they are a business associate if they handle only encrypted ePHI for which they do not have the decryption key. OCR has finally put this question to rest:
Lacking an encryption key does not exempt a CSP from business associate status and obligations under the HIPAA Rules.
As a result, the covered entity (or business associate) and the CSP must enter into a HIPAA-compliant business associate agreement (BAA), and the CSP is both contractually liable for meeting the terms of the BAA and directly liable for compliance with the applicable requirements of the HIPAA Rules.
The guidance then answers questions that OCR believes will help HIPAA-regulated CSPs and their customers in understanding their responsibilities under HIPAA. The following themes emerge from OCR's answers:
Security Rule Compliance Requires a Thorough Understanding of the CSP's Services
When asked whether covered entities and business associates can use CSPs to store and process ePHI, OCR responded affirmatively. In addition to the BAA, HIPAA's Security Rule requires covered entities (and business associates) to conduct their own risk analysis and establish risk management policies. In order to do this, covered entities (and business associates) must understand what the CSP is doing with the ePHI and the CSP's responsibilities to the ePHI. But gaining this understanding is easier said than done. Unlike traditional vendors, CSPs offer services that are, by their nature, complex and physically removed from the customer. In addition to a well-crafted BAA, the guidance points to the underlying service level agreements (SLAs) between parties as a potential vehicle for fleshing out each party's responsibilities.
Security Rule Applicable to "No-view Services"
OCR circles back to the question of whether HIPAA applies to CSPs maintaining encrypted ePHI for which they do not hold the decryption key. OCR defines these as "no-view services." According to OCR, while encryption reduces the risk of unauthorized viewing, it cannot alone safeguard the confidentiality, integrity and availability of ePHI as required by the Security Rule. For example, encryption alone cannot protect corruption by malware or ensure that the data remains available during emergencies and disasters. Full compliance with the Security Rule by CSPs providing no-view services is no longer open to debate.
The Actions of One Party May Satisfy Both Parties' HIPAA Requirements
In cases where a CSP is providing only no-view services to a covered entity (or business associate) customer, certain Security Rule requirements that apply to the ePHI maintained by the CSP may be satisfied for both parties through the actions of one of the parties. To illustrate this point, the guidance provides an example. If a CSP's customer implements its own reasonable and appropriate authentication controls and agrees that the CSP need not implement additional procedures to authenticate a person seeking access to the ePHI, then the Security Rule access control responsibilities would be met for both parties by the action of the customer. According to OCR, the CSP is still responsible under the Security Rule for other reasonable and appropriate controls to limit access to information systems that maintain customer ePHI. This would include, for example, internal controls to assure only authorized access to the administrative tools that manage the information systems hosting the ePHI.
The guidance also addresses other matters related to CSPs, including the following:
- CSPs cannot argue that they are a "conduit" and therefore not a business associate. CSPs providing cloud services that involve creating, receiving or maintaining ePHI meet the definition of a business associate, even if the CSP is providing no-view services.
- CSPs must document security incidents just like any other business associate and must satisfy any breach notification requirements that applies to unencrypted data.
- Health care providers, other covered entities, and business associates may use mobile devices to access ePHI in the cloud as long as appropriate physical, administrative, and technical safeguards are in place to protect the confidentiality, integrity, and availability of the ePHI on the mobile device and in the cloud.
- As is normally the case under HIPAA, CSPs are not required to maintain ePHI for a period of time beyond when it has finished providing services to a covered entity or business associate.
- Covered entities and business associates can use CSPs that store ePHI on servers outside the U.S., but should consider the increased risks of hacking or malware that may be present in other countries. Of course, cross-border transfers of ePHI may raise other regulatory issues.
- HIPAA does not require CSPs to provide documentation or allow auditing of their security practices by their customers.
- CSPs that receive and maintain only information that has been de-identified in accordance with the HIPAA Privacy Rule will not be considered a business associate.
OCR's guidance is a first step in clarifying HIPAA's reach into the cloud. However, the guidance is just that--a first step. It does not address more complex issues, including, for example, the use of application programming interfaces (APIs) or the distinction between different types of cloud services. Fortunately, OCR has created a question portal that can be used by stakeholders seeking answers to these more discrete questions.