Phoenix Healthcare-Settlement Agreement

Settlement Agreement

The parties to this Settlement Agreement (“Agreement”), Phoenix Healthcare LLC d/b/a Green County Care Center (“Phoenix”) and the United States Department of Health and Human Services, Office for Civil Rights (“OCR”) (collectively, the “Parties”), acting through their duly authorized representatives, mutually desire to enter into this Agreement with the below terms and conditions:

  1. Phoenix is a covered entity as defined under at 45 C.F.R. § 160.103, and as such, is required to comply with the Federal standards that govern the privacy of individually identifiable health information (45 C.F.R. Part 160 and Subparts A and E of Part 164, the “Privacy Rule”), the Federal standards that govern the security of electronic individually identifiable health information (45 C.F.R. Part 160 and Subparts A and C of Part 164, the “Security Rule”), and the Federal standards for notification in the case of breach of unsecured protected health information (45 C.F.R. Part 160 and Subparts A and D of 45 C.F.R.  Part 164, the “Breach Notification Rule”).
  2. By letter dated March 30, 2021, OCR notified Phoenix of its intention to impose a civil money penalty (“CMP”) against Phoenix in the amount of $250,000 for its failure to comply with 45 C.F.R. § 160.524(b)(2), 45 C.F.R. § 160.524(c)(4) and 45 C.F.R. § 502(e).
  3. On June 25, 2021, Phoenix requested a hearing before an Administrative Law Judge (“ALJ”) to contest OCR’s proposed imposition of the CMP, and the matter was docketed before the Civil Remedies Division of the Departmental Appeals Board (“DAB”) of the United States Department of Health and Human Services as Docket No. C-21-896.
  4. In Decision No. CR6232, dated February 16, 2023, the ALJ upheld the violations cited by OCR under 45 C.F.R §§ 164.524(b)(2), 164.524(c)(4), and 164.502(e) and directed that Phoenix pay a CMP in the amount of $75,000. The ALJ also upheld OCR’s determinations that Phoenix acted with willful neglect in violating sections 164.524(b)(2) and 164.524(c)(4).
  5. On April 17, 2023, Phoenix filed its notice of appeal and written brief in support thereof, in which Phoenix contested the ALJ’s determinations that Respondent acted with willful neglect with respect to the violations of sections 164.524(b)(2) and 164.524(c)(4) and challenged the imposition of the $75,000 CMP. That appeal was docketed at DAB Appellate Division Docket No. A-23-29.
  6. On August 4, 2023, the Departmental Appeals Board affirmed, in Decision No. 3105, the ALJ’s decision to uphold OCR’s determinations that Phoenix acted with willful neglect in violating sections 164.524(b)(2) and 164.524(c)(4) and the ALJ’s decision to impose a
  7. In consideration of the mutual understandings in the settlement of this matter and subject only to the conditions herein, the Parties agree as follows:
    1. This Settlement Agreement shall become effective (i.e., final and binding) upon the date of signing of this Agreement by the last signatory (“Effective Date”).
    2. Phoenix shall not appeal DAB Decision No. 3105, dated August 4, 2023, to federal court and shall not appeal or challenge that decision in any other forum or manner.
    3. As a compromise based on the unique facts and circumstances of this matter, OCR has agreed to accept, and Phoenix has agreed to pay to OCR, the amount of $35,000.00 (“Settlement Amount”) in full satisfaction of the CMP due and owing by Phoenix relating to the enforcement matter decided by ALJ Decision No. CR6232, dated February 16, 2023, and DAB Decision No. 3105, dated August 4, 2023. Phoenix agrees to pay the Settlement Amount on October 13, 2023, by the electronic transfer of funds to OCR via the Pay.gov portal. Pay.gov is the federal government secure portal for web-based collection and billing. OCR will send an e-invoice with payment instructions to Amy Inman, Director of Financial Services for Phoenix, via electronic mail to amy@phoenixhealthcarellc.com.
    4. Phoenix will revise its HIPAA Policies and Procedures to address (1) the Privacy Rule’s requirements concerning an individual’s right of access to Protected Health Information, and (2) its obligations to enter into Business Associate Agreements. Phoenix shall submit its revised Policies and Procedures to OCR for review and make any revisions requested by OCR until it receives OCR’s approval.  Phoenix must produce a set of HIPAA Policies and Procedures that OCR deems acceptable by October 16, 2023.
    5. On or before October 30, 2023, Phoenix will provide to OCR a signed attestation stating that it has implemented and distributed to its workforce members its revised set of HIPAA Policies and Procedures that OCR has deemed acceptable.
    6. On or before October 30, 2023, Phoenix will provide to OCR copies of all training materials it will use to train its workforce members regarding its revised set of HIPAA Policies and Procedures that OCR has deemed acceptable. By that date, Phoenix will also provide OCR with a description of the required training, including a summary of the topics to be covered, a schedule of when the training sessions will be held as well as the length of each training session, and the names of the persons and/or entities that will conduct the training. Phoenix shall submit these training materials to OCR for review and make any revisions requested by OCR until it receives OCR’s approval.  On or before November 15, 2023, Phoenix must produce training materials, a training schedule, and instructors that OCR deems acceptable.
    7. On or before November 30, 2023, Phoenix will provide to OCR a signed attestation stating that it has trained all of its workforce members regarding its revised set of HIPAA Policies and Procedures that OCR has deemed acceptable.
    8. Phoenix shall not contest the validity of its obligation to pay the Settlement Amount nor any other obligation it has agreed to under this Agreement. Phoenix waives all procedural rights granted under Section 1128A of the Social Security Act (42 U.S.C. § 1320a- 7a) and 45 C.F.R. Part 160 Subpart E.
    9. If Phoenix either fails to complete the above actions to OCR’s satisfaction by the specified deadlines or fails to pay the Settlement Amount by October 13, 2023, in accordance with paragraph 7.c above, OCR reserves the right to seek payment of the $75,000 CMP imposed in ALJ Decision No. CR6232, dated February 16, 2023, and affirmed in DAB Decision No. 3105, dated August 4, 2023. OCR will deduct from that $75,000 CMP any portion of the Settlement Amount already paid by Phoenix. In that event, Phoenix shall not contest the validity of its obligation to pay any outstanding portion of the $75,000 CMP. OCR may pursue collection of the outstanding amounts, plus interest, by all means available under the law for collection of debts due the United States or its agencies, including but not limited to offset of the debt from money due Phoenix Healthcare, LLC from OCR, the state Medicaid Agency and/or the United States Department of Treasury.
    10. The Parties are entering into this Agreement in consideration of Phoenix’s claims of financial hardship and documents submitted in support thereof as well as to avoid the time and cost of further litigation relating to DAB Decision No. 3105, dated August 4, 2023. Nothing in this Agreement should be construed as an admission of liability or concession of the position taken by either party.
    11. This Agreement is exclusively intended to settle the dispute concerning the enforcement action that is the subject of ALJ Decision No. CR6232, dated February 16, 2023, and DAB Decision No. 3105, dated August 4, 2023, and this Agreement does not constitute a waiver of any other rights or remedies available to the United States, HHS, OCR, or Phoenix that are not expressly stated in this Agreement.
    12. OCR does not release Phoenix from, nor waive any rights, obligations, or causes of action other than those arising out of or related to this Agreement. This release does not extend to any other action that may be brought under Section 1177 of the Social Security Act, 42 U.S.C. § 1320d-6.
    13. This Agreement is intended to be for the benefit of the Parties only and by this instrument the Parties do not release any claims against or by any other person or entity.
    14. The terms of this Agreement are contractual and shall be binding on the Parties, including their respective heirs, administrators, executors, successors, transferees, designees, assigns, and agents or contractors.
    15. This Agreement constitutes a complete description of the settlement reached by the Parties. Any modification to this Agreement must be made in writing and signed by the Parties or their duly authorized representatives.
    16. Each party to this Settlement Agreement shall bear its own costs and attorneys’ fees.
    17. This Agreement may be executed in counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. An electronic copy of this Agreement, executed by both parties, shall have the same force and effect as the original document.
    18. No restriction is placed on the publication of this Agreement.
    19. Each person executing this Agreement in a representative capacity on behalf of a party hereto warrants and represents that he or she is duly authorized by each entity to execute this Agreement on its behalf.

Dated the 22nd day of September, 2023.


For Phoenix Healthcare, LLC d/b/a Green Country Care Center:


____________________________________
Larry Cain
Owner and Court Appointed Receiver
Phoenix Healthcare, LLC
P.O. Box 2680
Tulsa, OK 74101

 

For the United States Department of Health and Human Services, Office for Civil Rights:


________________________________
Barbara Stampul
Regional Manager
Office for Civil Rights
U.S. Department of Health and Human Services
Sam Nunn Atlanta Federal Center
Suite 16T70
61 Forsyth Street, S.W.
Atlanta, GA 30303-8909
(800) 368-1019

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