Importance of HIPAA compliance for your cannabis IT company

What is HIPAA?

HIPAA is a federal law known as the Health Insurance Portability and Accountability Act of 1996 (HIPAA) that mandates the development of national standards to prevent the disclosure of sensitive patient health information (PHI) without the patient’s explicit knowledge or permission.

 HIPAA’s objectives include preventing misuse, fraud, and waste in the provision of healthcare and insurance, as well as enhancing access to long-term care services and insurance.

HIPAA standardizes the electronic transmission of administrative and financial processes to lower the cost of healthcare in the long run. It also serves the dual objective of providing workers with continuous health insurance coverage when they lose or change jobs.  

What are HIPAA privacy and security rules?

The HIPAA Privacy Rule covers how organizations wrapped up the rule should use and disclose peoples’ protected health information (also known as PHI). They are called “covered entities.”

The Privacy Rule also establishes guidelines for people’s rights to know how their health information is used and to exercise that control. 

Making sure that people’s health information is appropriately protected while allowing the flow of information necessary to deliver and promote high-quality healthcare, as well as to protect the public’s health and well-being, is one of the main goals of the Privacy Rule. 

It permits substantial information use while protecting the privacy of persons pursuing recovery and medical care.

When a covered entity creates, receives, uses, or maintains electronic personal health information (PIH) on a person, it must adhere to the national security regulations set forth under the HIPAA Security Rule. 

To put HIPAA’s rules into practice, the US Department of Health, and Human Services (HHS) established the HIPAA Privacy Rule. HIPAA Security Rule protects a portion of the data covered by the Privacy Rule.

Who does HIPAA apply to?

As stated in the HIPAA compliance rules, HIPAA is applicable to any individual, healthcare organization, and cloud-hosted business that needs to access and utilize patients’ protected health information (PHI). 

It applies to both medical operators and vendors with access to patient data, including IT companies. 

Here is a list of the organizations that require HIPAA:

• Health programs

• Clearinghouses 

• Healthcare organizations that use electronic means for some financial and administrative procedures

• Financial transfers and electronic billing are two examples of these electronic interactions, both of which follow standards that the Secretary under HIPAA has constituted

How does a medical cannabis business deal with HIPAA?

Cannabis dispensaries deal with PHI and hence must adhere to HIPAA regulations. PHI is the data that a healthcare professional gathers to identify a person and decide on the best course of treatment, including demographic data, insurance information, medical histories, physical and mental health situation, laboratory results, physical and electronic health data, and other data. You can face steep fines if you don’t stay HIPAA compliant.

Patients have a right to access their medical records within 30 days of a request, and failing to do so is against HIPAA. Another HIPAA violation is the loss of a device or document that makes patient information accessible to unauthorized parties. 

Businesses in the medicinal cannabis sector frequently employ patient verification systems because they must carefully operate within the confines of federal and state rules. These systems, which are typically virtual, hold PHI in the form of contact details, medical record numbers, health diagnoses, and other data. These verification methods enable dispensaries to confirm that a patient possesses the required prescription before administering their medication.

While some states mandate that dispensaries maintain PHI in this manner, others permit cash-only clinics that do not do so. A dispensary does not have the same requirements to comply with HIPAA if it is a cash-only business, which means that it does not store, process, or generate PHI in any way.

How does recreational cannabis deal with HIPAA?

For recreational operators, it’s greater peace of mind and risk management to be HIPAA compliant. While they are not necessarily accessing the patient information but since HIPAA compliance increases cybersecurity, this allows for good management. 

Once your recreational cannabis business is HIPAA compliant, the users can have greater confidence in your operations. They can rest assured of their privacy.

You know that the IT company’s systems are secure and that that security has been independently verified. Less worrying about security breaches, ransomware, outages, and reputation damage.

How does a cannabis IT company deal with HIPAA?

If you are an IT company dealing with the cannabis business, it can be a customer selling point being HIPAA compliant. Though HIPAA does not apply to IT companies, IT companies are dealing with patients’ data because they have access to their protected information. If your company is HIPAA qualified, a cannabis business can trust you and be willing to do business with you, staying assured that there won’t be data leaks, damages, ransomware attacks, and security threats.

Cure8 helps cannabis businesses to solve their IT problems and get the professional-grade tech they need to launch, thrive, and grow.

Contact us for your IT needs. Cure8 is now HIPAA compliance verified!

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