DMHAS: HIPAA - Business Associate Contract Language

{HIPAA Notice of Privacy Practices}
DMHAS HIPAA Initiative
Business Associate Contract Language
(Draft)


ADDENDUM TO CONTRACT  [Name of Contract]

WHEREAS, the Contractor [describe what the Contractor does for the state agency]

WHEREAS, under Part I of the contract, the Contractor is required to safeguard the use, publication and disclosure of information on all applicants for, and all clients who receive, services under the contract in accordance “with all applicable federal and state law regarding confidentiality,” which includes but is not limited to the requirements of the Health Insurance Portability and Privacy Act of 1996 (“HIPAA”), more specifically with the Privacy Rule at 45 C.F.R. Part 160 and Part 164, subparts A and E;

WHEREAS, [agency] is a “covered entity” as that term is defined in 45 C.F.R. § 160.103;

WHEREAS, the Contractor, on behalf of the [agency], performs functions that involve the use or disclosure of “individually identifiable health information,” as that term is defined in 45 C.F.R. § 160.103 ;

WHEREAS, the Contractor is a “business associate” of [agency], as that term is defined in 45 C.F.R. § 160.103;

WHEREAS, the Contractor and [agency] wish to comply with the Health Insurance Portability and Privacy Act of 1996 (“HIPAA”), more specifically with the Privacy Rule at 45 C.F.R. Part 160 and Part 164, subparts A and E;

NOW THEREFORE, the Contractor and [agency] agree to the following:

I.   Definitions

A.     Business Associate.  “Business Associate” shall mean the Contractor.

B.     Covered Entity.  “Covered Entity” shall mean [agency].

C.     Designated Record Set.  “Designated Record Set” shall have the same meaning as the term “designated record set” in 45 C.F.R. § 164.501.

D.     Individual.  “Individual” shall have the same meaning as the term “individual”’ in 45 C.F.R. 164.501 and shall include a person who qualifies as a personal representative as defined in 45 C.F.R. § 164.502(g).

E.      Privacy Rule.  “Privacy Rule” shall mean the Standards for Privacy of Individually Identifiable Health Information at 45 C.F.R. part 160 and parts 164, subparts A and E.

F.      Protected Health Information.  “Protected Health Information” or “PHI” shall have the same meaning as the term “protected health information” in 45 C.F.R. §  164.501, limited to information created or received by the Business Associate from or on behalf of the Covered Entity.

G.     Required by Law.  “Required by Law”’ shall have the same meaning as the term “required by law” in 45 C.F.R. § 164.501.

H.     Secretary.  “Secretary” shall mean the Secretary of the Department of Health and Human Services or his designee. 

I.        More Stringent. “More stringent” shall have the same meaning as the term “more stringent” in 45 C.F.R. § 160.103.

II.   Obligations and Activities of Business Associate

A.     Business Associate agrees not to use or disclose PHI other than as permitted or required by this Addendum or as Required by Law

B.     Business Associate agrees to use appropriate safeguards to prevent use or disclosure of PHI other than as provided for in this Addendum.

C.     Business Associate agrees to mitigate, to the extent practicable, any harmful effect that is known to the Business Associate of a use or disclosure of PHI by Business Associate in violation of this Addendum.

D.     Business Associate agrees to report to Covered Entity any use or disclosure of  PHI not provided for by this Addendum of which it becomes aware.

E.      Business Associate agrees to insure that any agent, including a subcontractor, to whom it provides PHI received from, or created or received by Business Associate, on behalf of the Covered Entity, agrees to the same restrictions and conditions that apply through this Addendum to Business Associate with respect to such information.

F.      Business Associate agrees to provide access, at the request of the Covered Entity, and in the time and manner agreed to by the parties, to PHI in a Designated Record Set, to Covered Entity or, as directed by Covered Entity, to an Individual in order to meet the requirements under 45 C.F.R. § 164.524.

G.     Business Associate agrees to make any amendments to PHI in a Designated Record Set that the Covered Entity directs or agrees to pursuant to 45 C.F.R. § 164.526 at the request of the Covered Entity, and in the time and manner agreed to by the parties.

H.     Business Associate agrees to make internal practices, books, and records, including policies and procedures and PHI, relating to the use and disclosure of PHI received from, or created or received by, Business Associate on behalf of Covered Entity, available to Covered Entity or to the Secretary in a time and manner agreed to by the parties or designated by the Secretary, for purposes of the Secretary determining Covered Entity’s compliance with the Privacy Rule.

I.        Business Associate agrees to document such disclosures of PHI and information related to such disclosures as would be required for Covered Entity to respond to a request by an Individual for an accounting of disclosures of PHI in accordance with 45 C.F.R. § 164.528.

J.       Business Associate agrees to provide to Covered Entity, in a time and manner agreed to by the parties, information collected in accordance with paragraph I of this section of the Addendum, to permit Covered Entity to respond to a request by an Individual for an accounting of disclosures of PHI in accordance with 45 C.F.R. § 164.528.

K.    Business Associate agrees to comply with any state law that is more stringent than the Privacy Rule.

III.  Permitted Uses and Disclosures by Business Associate

A.     General Use and Disclosure Provisions

Except as otherwise limited in this Addendum, Business Associate may use or disclose PHI to perform functions, activities, or services for, or on behalf of, Covered Entity as specified in Part Three of the Contract, provided that such use or disclosure would not violate the Privacy Rule is done by Covered Entity or the minimum necessary policies and procedures of the Covered Entity.

B.  Specific Use and Disclosure Provisions

A.     Except as otherwise limited in this Addendum, Business Associate may use PHI for the proper management and administration of Business Associate or to carry out the legal responsibilities of Business Associate.

B.     Except as otherwise limited in this Addendum, Business Associate may disclose PHI for the proper management and administration of Business Associate, provided that disclosures are Required by Law, or Business Associate obtains reasonable assurances from the person to whom the information is disclosed that it will remain confidential and used or further disclosed only as Required by Law or for the purpose for which it was disclosed to the person, and the person notifies Business Associate of any instances of which it is aware in which the confidentiality of the information has been breached. 

C.     Except as otherwise limited in this Addendum, Business Associate may use PHI to provide Data Aggregation services to Covered Entity as permitted by 45 C.F.R. § 154.514(e)(2)(i)(B). 

IV.  Obligations of Covered Entity

A.     Covered Entity shall notify Business Associate of any limitations in its notice of privacy practices of Covered Entity, in accordance with 45 C.F.R. 164.520, or to the extent that such limitation may affect Business Associate’s use or disclosure of PHI. 

B.     Covered Entity shall notify Business Associate of any changes in, or revocation of, permission by Individual to use or disclose PHI, to the extent that such changes may affect Business Associate’s use or disclosure of PHI.

C.     Covered Entity shall notify Business Associate of any restriction to the use or disclosure of PHI that Covered Entity has agreed to in accordance with 45 C.F.R. § 164.522, to the extent that such restriction may affect Business Associate’s use or disclosure of PHI. 

V.  Permissible Requests by Covered Entity

Covered Entity shall not request Business Associate to use or disclose PHI in any manner that would not be permissible under the Privacy Rule if done by the Covered Entity, except that Business Associate may use and disclose PHI for data aggregation, and management and administrative activities of Business Associate, as permitted under this Addendum.

VI.  Term and Termination

A.     Term.  The Term of this Addendum shall be effective as of the date the Contract is effective and shall terminate when all of the PHI provided by Covered Entity to Business Associate, or created or received by Business Associate on behalf of Covered Entity, is destroyed or returned to Covered Entity, or, if it is infeasible to return or destroy PHI, protections are extended to such information, in accordance with the termination provisions in this Section.

B.     Termination for Cause.  Upon Covered Entity’s knowledge of a material breach by Business Associate, Covered Entity shall either:

(1)   Provide an opportunity for Business Associate to cure the breach or end the violation and terminate the Contract if Business Associate does not cure the breach or end the violation within the time specified by the Covered Entity; or

(2)   Immediately terminate the Contract if Business Associate has breached a material term of the Addendum and cure is not possible; or

(3)   If neither termination nor cure is feasible, Covered Entity shall report the violation to the Secretary.

C.     Effect of Termination. 

(1)   Except as provided in paragraph (2) of this subsection C, upon termination of this Contract, for any reason, Business Associate shall return or destroy all PHI received from Covered Entity, or created or received by Business Associate on behalf of Covered Entity.  This provision shall apply to PHI that is in the possession of subcontractors or agents of Business Associate.  Business Associate shall retain no copies of the PHI.

(2)   In the event that Business Associate determines that returning or destroying the PHI is infeasible, Business Associate shall provide to Covered Entity notification of the conditions that make return or destruction infeasible.  Upon documentation by Business Associate that return of destruction of PHI is infeasible, Business Associate shall extend the protections of the Addendum to such PHI and limit further uses and disclosures of PHI to those purposes that make return or destruction infeasible, for as long as Business Associate maintains such PHI. 

VII.  Miscellaneous Provisions

A.     Regulatory References.  A reference in this Addendum to a section in the Privacy Rule means the section as in effect or as amended.

B.     Amendment.  The Parties agree to take such action as in necessary to amend this Addendum from time to time as is necessary for Covered Entity to comply with requirements of the Privacy Rule and the Health Insurance Portability and Accountability Act of 1996, Pub. L. No. 104-191.

C.     Survival.  The respective rights and obligations of Business Associate under Section VI, Subsection C of this Addendum shall survive the termination of this Contract.

D.     Effect on Contract.  Except as specifically required to implement the purposes of this Addendum, all other terms of the contract shall remain in force and effect.

E.      Construction.  This Addendum shall be construed as broadly as necessary to implement and comply with the Privacy Standard.  Any ambiguity in this Addendum shall be resolved in favor of a meaning that complies, and is consistent with, the Privacy Standard.

F.      Disclaimer.  Covered Entity makes no warranty or representation that compliance with this Addendum will be adequate or satisfactory for Business Associate’s own purposes. Covered Entity shall not be liable to Business Associate for any claim, loss or damage related to or arising from the unauthorized use or disclosure of PHI by Business Associate or any of its officers, directors, employees, contractors or agents, or any third party to whom Business Associate has disclosed PHI pursuant to paragraph II D of this Addendum.  Business Associate is solely responsible for all decisions made, and actions taken, by Business Associate regarding the safeguarding, use and disclosure of PHI within its possession, custody or control.

G.     Indemnification. The Business Associate shall indemnify and hold the Covered Entity harmless from and against all claims, liabilities, judgments, fines, assessments, penalties, awards, or other expenses, of any kind or nature whatsoever, including, without limitation, attorney's fees, expert witness fees, and costs of investigation, litigation or dispute resolution, relating to or arising out of any violation by the Business Associate and its agents, including subcontractors, of any obligation of Business Associate and its agents, including subcontractors,  under this Addendum.

[NAME OF BUSINESS ASSOCIATE ]                       [Name of  agency]

By:_________________________                           By:__________________________

Its:_________________________                            Its:__________________________

Dated:______________________                            Dated:_______________________





Content Last Modified on 3/27/2007 1:03:53 PM