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Rite Aid Corporation and its 40 affiliated entities have agreed to pay $1 million to settle potential violations of the HIPAA Privacy Rule, HHS announced. Rite Aid, one of the nation's largest drug store chains, agreed to take corrective action to safeguard the privacy of its customers when disposing of identifying information on pill bottle labels and other health information.
 
Rite Aid came under scrutiny after television reporters videotaped incidents in which pharmacies were shown to have disposed of prescriptions and labeled pill bottles containing individuals' identifiable information in industrial trash containers that were accessible to the public. These incidents were reported as occurring in a variety of cities across the United States.  Rite Aid pharmacy stores in several of the cities were highlighted in media reports.
 
Disposing of individuals' health information in an industrial trash container accessible to unauthorized persons is not compliant with several requirements of the HIPAA Privacy Rule and exposes the individuals' information to the risk of identity theft and other crimes, the HHS noted.

"It is critical that companies, large and small, build a culture of compliance to protect consumers' right to privacy and safeguard health information," said Georgina Verdugo, director of the Office of Civil Rights, the HHS arm that undertook a joint investigation of Rite Aid with the Federal Trade Commission. "We hope that this agreement will spur other health organizations to examine and improve their policies and procedures for protecting patient information during the disposal process."

Among other issues, the reviews by OCR and the FTC demonstrate that:
* Rite Aid failed to implement adequate policies and procedures to appropriately safeguard patient information during the disposal process;
* Rite Aid failed to adequately train employees on how to dispose of such information properly; and
* Rite Aid did not maintain a sanctions policy for members of its workforce who failed to properly dispose of patient information.
 
Under the HHS resolution agreement, Rite Aid agreed to pay a $1 million resolution amount to HHS and must implement a corrective action program that includes:
* revising and distributing its policies and procedures regarding disposal of protected health information and sanctioning workers who do not follow them;
* training workers on these new requirements;
* conducting internal monitoring; and
* engaging a qualified, independent third-party assessor to conduct compliance reviews and render reports to HHS.

In addition to paying the settlement, Rite Aid signed a consent order with the FTC to settle potential violations of the FTC Act.

The HHS Resolution Agreement and Corrective Action Plan can be found on the OCR website. 

OCR has FAQs that address the HIPAA Privacy Rule requirements for disposal of protected health information. 

Information about the FTC Consent Order agreement is available at http://www.ftc.gov.