The Need for HIPAA Compliance in Health Care ERPs

By Devin Partida, Editor-in-Chief,
Twitter: @rehackmagazine

Enterprise resource planning tools are essential for health care organizations that need to automate and integrate processes across multiple verticals.

Modern ERPs need to be HIPAA-compliant — otherwise, they can leave the organizations that use them open to violations. Facilities may also miss out on the benefits that come with this technology.

Here are some of the benefits this software can offer.

1. Preventing HIPAA Violations

The key benefit of a HIPAA-compliant ERP is that it helps clients steer clear of HIPAA violations. No matter how they are used, health care ERPs are likely to either store or have access to protected health information (PHI), identifying medical records that need to be protected.

ERPs that are not HIPAA-compliant in how it stores or accesses those records could be in violation. As a result, organizations can face significant penalties. The minimum fine for a “willful violation” of HIPAA rules is $50,000, and individuals can face penalties up to $250,000. Jail terms also aren’t out of the question, depending on the nature of the violation.

In many cases, a HIPAA complaint can be enough to force an organization to close. Even if a health care facility survives the violation, the loss of patient loyalty or employees quitting can affect it for years.

An ERP built with HIPAA compliance in mind helps organizations ensure they’re staying in line with HIPAA rules, so they avoid potential violations. It also can reduce operational costs by making compliance easier in day-to-day work.

2. Improved Cybersecurity

In addition to offering tools that ensure HIPAA compliance, some ERPs also provide additional patient data-protection features, such as encryption. These tools can help an organization defend itself against the growing threat of cyberattacks that target health care facilities.

All businesses are at risk if they hold on to valuable data. Hackers are increasingly targeting small businesses, meaning that any health care operation large enough to need an ERP will likely also require effective cybersecurity.

3. Generating Usable Data

Patient medical data can be extremely valuable for an organization — but only when properly de-identified. Otherwise, using this information could be unethical and potentially dangerous, as well as a HIPAA violation.

HIPAA compliance helps organizations ensure the protected health information they store can only be used and disclosed in certain ways. The anonymization of PHI presents an opportunity to ensure data is HIPAA compliant, ethical and will ultimately protect patient privacy.

4. Improved Patient Loyalty and Trust

HIPAA compliance and effective data stewardship are great ways for organizations to build trust with the people they serve.

Patients understand that they provide a significant amount of sensitive data to the health care providers they work with. Organizations that take care to protect this information can demonstrate they take privacy and security seriously.

5. Creating a Culture of Data Security

Effective data stewardship requires buy-in from employees across an organization. If the people who work directly with protected health information don’t take data security seriously, they may be more likely to make mistakes or engage in unethical practices that can lead to HIPAA violations.

An ERP that encourages or requires employees to adopt ethical and HIPAA-compliant data practices can also help an organization cultivate an internal culture of data security. This will help ensure workers prioritize good data stewardship in their jobs.

Why HIPAA-Compliant ERPs Are Becoming Essential

As data becomes more important to health care organizations, so will HIPAA-compliant tools. An ERP that is built with HIPAA in mind will help facilities improve data stewardship, ensuring more effective cybersecurity practices and reducing the risk of violations.