Small Practices, Big Fines: Understanding HIPAA Penalties
July 7, 2025 Did you know that over half of physicians work in small medical practices with 10 or fewer physicians? You likely wear many hats when working in or even running your small practice, from taking care of patients to clerical work, and of course, HIPAA compliance. Although other priorities may push HIPAA compliance to the side, being compliant is essential for the success of your practice. It’s a common misconception that since a practice is small, the Office for Civil Rights (OCR) will not investigate it if an issue occurs. The OCR has fined several small practices recently, with ramped-up enforcement, nearing $10 million within the year’s first half. Here are some of the most recent fines imposed on small medical practices and how your practice can avoid them. The SRA Superpower Comprehensive Neurology, PC, a small neurology practice in New York, was recently fined $25,000 after a ransomware attack exposed the practice’s insufficient protections for securing Protected Health Information (PHI). Specifically, the practice did not have a Security Risk Analysis (SRA). The SRA is an annual assessment of your practice’s administrative, technical, and physical safeguards, reviewing potential vulnerabilities. When handled properly, the SRA allows you to mitigate risks before a situation occurs. While commonly missed, the SRA is the foundation of a successful practice. To combat this, the OCR has recently enacted the Risk Analysis Initiative, which has brought increased scrutiny and led to nearly a million dollars in fines since its implementation late last year. Completing an SRA is paramount to protect your small medical practice from similar initiatives. The SRA is a crucial protective barrier, proactively preventing issues before they escalate into significant problems. For instance, if the practice completed an SRA, they could have seen any technological shortcomings that led to the severity of the ransomware attack. Alert the Press! Vision Upright MRI, a small California healthcare provider focused on medical imaging, was fined $5,000 in May. In addition to missing an SRA following a breach, the small practice from California did not adequately inform patients. As part of the Breach Notification Rule, relevant parties, like impacted patients, the OCR, and, depending on the size of the breach, the media, and more, must all be notified following a breach. Patients can decide how to secure their information by being informed, and the practice should pay for credit monitoring. With over 21,000 patients’ PHI compromised, the practice needed to notify several parties quickly. Regardless of the breach’s size, a practice must inform all affected patients within 60 days of discovery. However, given that this breach affected over 500 patients, the OCR, media, and some states (like California), the state attorney general also required notification within that time frame. Once you have mitigated the situation and understood the full scope, it’s time to alert all necessary parties. If the breach impacts fewer than 500 patients, while patients still need to be notified within 60 days, the practice must notify the OCR within 60 days of the calendar year in which it occurred. Deliver Records Swiftly Gums Dental Care LLC, a small dental practice in Maryland, was fined $70,000 after refusing to provide a patient’s medical records. Under the HIPAA Privacy Rule, patients must receive their medical records within 30 days of request. This requirement, known as the Right of Access, is one of the most common violations. In this situation, Gums Dental Care provided records three years after the initial request. To avoid similar penalties, ensure all staff are trained efficiently to provide patient records. Quickly addressing patient requests prioritizes their needs, secures your practice, and builds patient trust. Simplifying Compliance for Your Small Practice While following the complexities of HIPAA might feel overwhelming, with the right solution, it doesn’t have to be. Intelligent software can streamline compliance for your practice, alleviating the responsibility and freeing time to spend with patients. Smart solutions also encompass HIPAA’s requirements, including the SRA, breach logs, and staff training. Schedule a consultation today to learn more about simplifying compliance for your small practice.
