HIPAA - As a Business Associate, are you compliant?

  • By proadAccountId-371192
  • 14 Jul, 2017

Aberdare Business Solutions is Compliant!!

HIPAA (Health Insurance Portability and Accountability Act of 1996) is a United States legislation that provides data privacy and security provisions for safeguarding medical information. HIPAA was signed into law by President Bill Clinton in August 1996. The primary purpose of HIPAA: The rule protects from unauthorized disclosure of any PHI and/or ePHI (Protected Health Information and/or electronic Protected Health Information) that pertains to a consumer of healthcare services. The law gave the U.S. Department of Health and Human Services the responsibility of adopting rules to help patients and other healthcare consumers keep as much of their personal information as private as possible. The HIPAA privacy rule applies to "covered entities", such as health plans, healthcare clearinghouses, and healthcare providers. It applies to employers only to the extent that they somehow operate in one or more of those capacities. Not only does HIPAA apply to health plans, healthcare clearinghouses, and healthcare providers, it also applies to “Business Associates” , defined as any organization or individual who acts as a vendor or subcontractor with access to PHI and/or ePHI. Examples of business associates include: data transmission providers and processing firms, data storage or document shredding companies, medical equipment companies, consultants hired for audits & coding reviews, electronic health information exchanges, medical transcription services, external auditors or accountants, etc.
With such a wide range of entities and business associates covered by HIPAA, it’s therefore critically important to know exactly what PHI and/or ePHI entails.

  1. Any information included in a medical record that can identify an individual and was created while providing healthcare (such as    diagnosis or treatment) falls under the category of protected health information.

  2. Any conversation that a physician has with a patient regarding his or her treatment, a patient’s billing information and medical information in the patient’s health insurance company’s database would also be considered PHI and/or ePHI.

Taking the necessary steps to become and remain HIPAA compliant benefits and protects your patients and/or clients. Ignoring these important precautions and practicing outside the law puts your entire organization at risk. Violations of the Health Insurance Portability and Accountability Act carry consequences which the offending facility and its healthcare workers could face if found guilty. These penalties include corrective action, fines, career decline, jail time, and patient mistrust.

If found noncompliant, your facility would have to work through a deadline-driven corrective action plan. The purpose of the plan is to bring your facility up to HIPAA compliance standards. Corrective action plans usually require one or all of these actions to take place within a specified
period of time (even as little as thirty days): ePHI risk analysis, ePHI encryption, documentation of policies and procedures related to privacy, security, and breach notification and workforce training.

HIPAA fines are tiered based on the severity of the violation and the facility’s knowledge of the noncompliance. There are four tiers:
 • If a facility was unaware (and could not have reasonably been aware) of a violation, the penalty ranges from $110 to $55,010 per violation.
 • If a violation occurs due to reasonable cause (and not willful neglect), the penalty ranges from $1,100 to $55,010 per violation.
 • If a violation is due to willful neglect but is corrected in a timely manner, the penalty ranges from $11,002 to $55,010 per violation.
 • If a violation is due to willful neglect but is not corrected in a timely manner, the maximum penalty of $55,010 per violation applies.

If violations are repeated (of identical nature) and occur in the same calendar year, the penalty is $1,650,300.00 per violation.
Other consequences can have a longer-lasting effect on your career. If a breach can be attributed to an individual, that individual is at risk for termination of employment. For example, if an employee accesses the medical records of a patient for no reason (i.e., the employee does not need to know the patient’s history or status to do his or her job), the employee has compromised that patient’s privacy and could be fired. Some violations may lead to jail time.

• Willingly obtaining or disclosing ePHI outside HIPAA rules: Penalty of up to one year in jail.
• Obtaining ePHI through deception: Penalty of up to five years in jail.

These jail sentences are typically accompanied by fines of $50,000 to $250,000. The fines and jail time for each offense are dependent on the charges as well as the state in which the offense occurred.

Failing to comply with HIPAA guidelines and protect your patients’ private health information could be truly damaging to your practice/business. Your patients put their trust in your company to keep their information private and failing to be HIPAA compliant is putting your patients and company at risk.

If you need more information, want to understand the laws, or be assured that your Business Associates are not putting your HIPAA status at risk call the professionals at Aberdare Business Solutions 281-599-3380 for more information.

Gambling Winnings

By proadAccountId-371192 24 Oct, 2017

Victims of hurricanes Harvey, Irma, and Maria get relief from Congress. They can take casualty losses from the storms even if they don’t itemize. They’re able to deduct uninsured personal losses more than a $500 threshold without regard to the 10%-of-AGI offset that generally applies to the deduction.  2016 income can be used to figure the 2017 earned income tax credit. The same applies for the child tax credit. This will prevent a cut in these tax breaks for lower-incomers whose jobs have been suspended or lost due to the hurricanes.

 

The 10% penalty on pre-age 59½ payouts from retirement accounts is waived, if the IRA or retirement plan withdrawals are not greater than $100,000. The income tax due on such distributions can be spread over a three-year period. Amounts recontributed to the plan or IRA during that span will be treated as rollovers, and tax paid on those amounts can be recovered by filing an amended Form 1040.

 

Victims can borrow more from company retirement plans such as 401(k)s, up to the lesser of $100,000 or 100% of the account. Loan repayments can be deferred. The 50%-of-AGI limitation on charitable donations is suspended for any cash donations to qualified charities that aid victims of Harvey, Irma and Maria.

 

Corporations can fully deduct cash donations for hurricane relief. The usual 10% of taxable income limit does not apply to such contributions. There’s a special break for hurricane-affected firms that keep paying workers even though business operations have been suspended in the wake of the storms. They get a 40% tax credit for up to $6,000 of wages paid to each idle employee.

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By proadAccountId-371192 24 Oct, 2017

IRS’s simplified per diems for lodging, meals, and incidentals are going up. In high-cost localities, employees can get up to $284 each day free of tax. In other areas, their daily stipend is capped at $191. Both amounts are up $2. 

 

Businesses using this method have the choice to use these higher rates as of Oct. 1 or wait until Jan. 1, 2018. Firms can opt instead to use these higher rates as of Oct. 1 or wait until Jan. 1, 2018. Firms can opt instead to use federal per diems separately figured for hundreds of cities.

 

No change to the rates for meals and incidentals only, this stayed at $68 per day in high-cost areas and $57 in other locations. Self-employed individuals on travel can use these rates in lieu of keeping receipts, but their lodging expenses must be sustained separately. They cannot use the full $284/$191 per diems. The per diem rate solely for incidentals is also unchanged at $5 a day.

By lemaster 17 Oct, 2017
Harris County residents experienced one of the worst flooding disasters in U.S. history when Hurricane Harvey impacted the region late August 2017. Dozens of lives were lost and thousands of homes were destroyed as catastrophic rainfall devastated Harris and surrounding counties.

As communities continue to reclaim normalcy from Harvey, the Harris County Office of Homeland Security & Emergency Management is working in collaboration with the State of Texas, the Federal Emergency Management Agency (FEMA) & non-profit partners to help with the recovery process.

This Harvey Recovery Resource Guide offers important information about available resources and assistance available to residents affected by the floods.

All individuals impacted by flooding should apply for FEMA assistance at 1-800-621-3362 or online at www.DisasterAssistance.gov by October 26, 2017.

The Office of Ted Heap, Harris County Constable Pct. 5 continues to patrol those neighborhoods that were devastated by flooding. Contract neighborhoods received more coverage than normal as a result of diverting all the department’s resources to a law enforcement function. We hope this guide will help provide answers for those that were impacted by the storm.
By proadAccountId-371192 29 Sep, 2017
Donating leave for Hurricane Harvey.
Under new IRS guidance for leave-based donations, employers can make cash payments to qualifying charities that match vacation, sick, or personal leave forgone by employees. The donations are not income to these employees— but they are not charitable deductions either. The cash payments must be made to organizations qualified under code §170, Charitable, etc., contributions and gifts, before Jan. 1, 2019.

Key point: Employers can choose to deduct the payments as charitable contributions or as business expenses and should not include the payments as income on the contributing employees’ W-2s. [Notice 2017-48; 2017-39 IRB 10]
By proadAccountId-371192 29 Sep, 2017

A Senate proposal on worker classification is drawing praise from business.

 The bill from Sen. John Thune (R-SD) would provide a new safe harbor based on three criteria that, if met, would qualify workers as independent contractors:

  •  The relationship between the respective parties, the existence of a written contract, and the location of the services or how the services are provided. The measure lists objective factors that would satisfy each of these categories.
  •  Additionally, the proposal makes changes to the Form 1099 reporting rules. Currently, the 1099-MISC is required when payments to a nonemployee exceed $600. Third-party networks must send a 1099-K to payees who have over 200 transactions and were paid more than $20,000. Compliance with these rules is haphazard at best. Many third-party networks file 1099-Ks. Others use the 1099-MISC. Some send both.
  •  Thune would have third-party networks in the gig economy use the 1099-K, while payers in traditional independent contractor relationships would file the MISC.
  •  Reporting on the 1099-K would be required on annual payments over $1,000 to contractors. This idea would raise a significant amount of money, something that tax writers will look on favorably on as they eye revenue-raisers to offset lower tax rates in tax reform.   Additionally, the threshold for filing the 1099-MISC would increase to $1,000.

By proadAccountId-371192 29 Sep, 2017

You won’t automatically be audited for having above-average deductions; however, if your write-offs are excessively large, your audit risk can go up because that is a key factor in the Revenue Service’s return selection process. 

 Here’s an example where taking large charitable deductions raised a red flag with the agency.  A couple was audited after they claimed total charitable write-offs of $142,250 for property donations to Goodwill. Because they couldn’t prove the value of the items donated, the Tax Court disallowed all but $250 of their deduction and slapped them with the 20% penalty for negligence (Ohde, TC Memo. 2017-137).

 Charitable deductions can sometimes be lost if conditions are attached by the donor. In this case, the owner of a run-down movie theater wanted to transfer it in a bargain sale to an unrelated, newly formed nonprofit. Since the transferee hadn’t yet received its tax exemption, the building’s owner arranged a bargain sale with another charity but agreed that it could direct a subsequent conveyance to the ultimate transferee. This transfer restriction included in the contract of sale caused the Tax Court to rule that the owner didn’t relinquish dominion and control over the building and that no charitable gift was made (Fakiris, TC Memo. 2017-126).

By proadAccountId-371192 29 Sep, 2017

Worker classification remains a priority. The Internal Revenue Service continues to seek back taxes and penalties from firms that wrongly treat workers as contractors. Unreported or underreported employment taxes make up a big chunk of the overall federal tax gap. The Labor and Justice Departments, along with Individual States also have vital roles to play in ensuring that workers are properly classified by the businesses they work for.

 

The stakes have always been high, lost taxes for federal and state governments and fewer benefits for workers who are improperly treated as contractors.  The importance is magnified with the growth of freelance service gigs. Freelance gigs such as Uber, Rover, Grubhub and Fiverr are making up a growing portion of the part time economy.  

 

To classify workers, the IRS uses three tests, each made up of multiple factors.

             

The Behavioral Test focuses on whether the company controls or has the right to control what the worker does and how to do the job. Key factors for employee status include instructions about performing the work, evaluation criteria and training.

 

The Financial Test looks at who controls the economics of the worker’s job. Being able to work for multiple firms and providing your own tools needed for the job are indicative of independent contractor status. Some factors favoring employee status are eligibility for reimbursement of travel costs and payment based on hours worked.

 

The Type-of-Relationship Test examines how the parties perceive each other. Providing paid vacation and retirement benefits indicates a worker is an employee, as does hiring to provide services indefinitely rather than for a specific time. Written language stating the worker is an independent contractor isn’t determinative.

 

Aberdare Business Solutions offers a variety of Lunch & Learn Seminars or on-site seminars regarding the above topics. Additionally, we include information pertaining to the Department of Labor and the Texas Workforce Commission. If you are interested in attending a seminar or having us speak at your company or association please contact our office at 281.599.3380 or info@aberdare.us.com

By proadAccountId-371192 29 Sep, 2017

The cost to become a dog groomer doesn’t qualify for an education tax break through The American Opportunity Tax Credit. The couple in the case has a daughter who after taking one class at a local community college, decided on a different track and enrolled in a dog grooming program with a company aptly named Canine Clippers.

 Only tuition paid to accredited postsecondary institutions is eligible for the AOTC, and the parents provided no evidence that Canine Clippers met that standard or that their daughter attended at least half-time (Martin, TC Summ. Op. 2017-73).

By proadAccountId-371192 29 Sep, 2017

IRS is on the prowl for filers who claim large charitable deductions, as a big-game hunter found out after he took a $1.45 million write-off for animal hides, skulls, horns, and other hunting specimens he donated to charity. He claimed the items he gave were of museum quality, with no market comparables, and should be valued at their estimated replacement cost.

 

The Tax Court disagreed, saying the specimens were commodities, not collectibles, and that fair market value is based on market prices of similar items. The Court allowed a $163,000 deduction, the figure determined by the Service’s appraiser (Gardner, TC Memo. 2017-165).


 

By proadAccountId-371192 29 Sep, 2017
IRS’s efforts at combatting tax identity theft seem to be paying off. Complaints of ID theft fell 46% in 2016 from the previous year, to 376,500.

Additionally, the numbers for the first quarter of 2017 seem to be following that trend. Some of the decline may be because of new antifraud measures the agency is using to filter out returns filed by identity thieves. Last year, IRS computers stopped more than $6.5 billion in fraudulent refunds on approximately 970,000 returns filed under stolen Social Security numbers and tax identification numbers.
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