Pension & Benefits News Employer’s reasonable belief of HIPAA violations sufficient to dismiss retaliatory discharge lawsuit
Tuesday, March 19, 2019

Employer’s reasonable belief of HIPAA violations sufficient to dismiss retaliatory discharge lawsuit

By Pension and Benefits Editorial Staff

A county-employed social worker failed to show that a retaliatory animus could be inferred from her termination because there was ample evidence that the county reasonably believed she violated federal patient privacy law and county policies, in addition to showing poor judgment, when she accessed patient files to confirm their contact information, used that information to encourage them to participate in a public board meeting in spite of their vulnerable mental health and without consulting their treating physicians, in which she represented herself as a constituent and not a county employee in order to complain about county-provided mental health services, a state appellate court in California ruled in an unpublished opinion, affirming the lower court.

Background. A social worker hired by the County of Monterey in California and was promoted three years later to become a psychiatric social worker. As part of her employment, she certified she had read the County’s Health Insurance Portability and Accountability Act (HIPAA) handbook, attesting that she would "[n]ever access or use protected health information out of curiosity or for personal interest or advantage." She also participated in the County’s Mind/Body/Spirit program, which was run by a psychiatrist formerly employed with the County.

Following the termination of the psychiatrist, in 2014 the social worker accessed the patient database on Saturday and checked the medical records of 65 mental health patients, of which only seven were in her care. She contacted those patients and asked them to attend a public board of supervisors meeting in order to protest the psychiatrist’s termination. However, the social worker did not inform her supervisor she would be working on a Saturday or accessing the files per office policy, nor did she consult with the patients’ doctors of her intention to ask them to attend the public forum. At the meeting, she introduced herself as a private constituent with family in mental health care with concerns about the County programs. She also stated that there were others in attendance at the meeting who also had concerns about their mental health care and 11 stood up and others spoke at the meeting.

When the County learned of her actions at the board meeting, it initiated an investigation as to whether the social worker violated the patients’ privacy rights. The investigation concluded that she violated HIPAA and County policies, in addition to showing poor judgment with respect to the welfare of the patients she contacted. The County notified 63 active clients of the HIPAA violations and many clients informed the County of their concerns regarding the confidentiality breaches, with some sharing that the experience at the meeting caused them fear or discomfort. Accordingly, the County followed the recommendation that the social worker’s employment be terminated.

The social worker filed a lawsuit on the grounds that her termination was retaliatory because she voiced concerns about the mental health services delivered by the County and was exercising protected speech pursuant to 42 U.S.C. section 1983 and state whistleblower laws. The County filed a motion for summary judgment, which the trial court granted. The social worker filed the present appeal to challenge several evidentiary rulings and the grant of summary judgment.

Retaliatory discharge. The appellate court explained that, under the McDonnell Douglas burden-shifting framework, despite the social worker’s demonstration of a prima facie case of retaliatory discharge, she failed to overcome the County’s establishment of legitimate, non-retaliatory reasons for ending her employment. Neither the social worker nor the County disputed that a prima facie case was made. The social worker argued that she did not violate HIPAA or the County’s policies and, thus, her termination was retaliatory. The appellate court clarified that its role was not to determine whether the social worker actually violated HIPAA or the policies in order to determine if the County’s actions were motivated by a discriminatory or retaliatory animus. Instead, the appellate court must determine if the County honestly believed that HIPAA and the privacy protection policies were violated to support its termination of the social worker’s employment.

Protected health information. The social worker argued that when she accessed the patient database, she used it only to confirm phone numbers she had of patients and, thus, she did not access protected patient information. However, HIPAA explicitly includes "demographic information" of patients as "individually identifiable health information" (42 U.S.C. § 1320d(6)), which could be read to include phone numbers, and the County policy handbook expressly stated that a patient phone number is an example of protected health information as it is "information which can be matched with a patient, is created in the process of caring for the patient, and is kept, filed, used or shared in an electronic, written or oral manner." Thus, the factfinder would not find the County was dishonest about citing a HIPAA violation as cause for the social worker’s termination.

Authorized use. The social worker asserted that she was authorized to use the patient database as part of her role in the Mind/Body/Spirit program and that informing the patients about the board meeting was part of their treatment. Although accessing patient information to facilitate treatment is permitted under HIPAA, the appellate court explained that her reliance on the regulatory definition of "treatment" (45 C.F.R. §164.501) for her actions around the board meeting "strain[ed] credulity." Further, she testified that she was acting personally and not professionally at the board meeting, which clearly violated her signed acknowledgement statement that she would not use patient information for personal use. Thus, the social worker’s own testimony supported the County’s position that its policies were violated.

Poor judgment. The social worker proffered evidence of her consistent performance in her role with the County and her later appointment to the County Mental Health Commission as reflecting good judgment, but the appellate court distinguished general favorable performance from her specific actions surrounding the board meeting. The County showed that several clients were adversely affected by being encouraged to speak publicly and by receiving the HIPAA violation notice. Additionally, the evidence showed that she was advised to consult with the treating physicians before contacting the clients and that she did not.

Prior complaints. Finally, the social worker’s reliance on alleged prior instances of retaliatory conduct following her complaints to the board was unsubstantiated. The appellate court observed no evidence of adverse employment consequences in the wake of complaints the social worker had made before the board meeting. Because she failed to provide sufficient evidence that the County acted with a retaliatory animus when it terminated her employment, the lower court’s grant of summary judgment in favor of the County was affirmed.

SOURCE: Barreras v. County of Monterey, (Cal. App.), No. H044667, February 19, 2019.

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