Arizona High Court Revives Privacy Violation Case Over Pharmacy ED Prescription Disclosure

The Arizona Supreme Court brought back a HIPAA violation legal action that a guy from Phoenix filed due to a privacy violation by a pharmacy staff linked to an erectile dysfunction drugs prescription.

Greg Shepherd, 50 years old, had seen his doctor for a routine healthcare visit in January 2016. His physician prescribed him an erectile dysfunction medicine sample. Soon after, the Costco pharmacy contacted him and mentioned that he can pick up the complete prescription for the ED medication. Shepherd told the employee that he didn’t want the medicine and canceled the order.

Shepherd contacted the pharmacy 30 days after to find out if an unrelated prescribed medication was available for collection, and the pharmacy again told him that his ED medication was still available for pick up. Shepherd rejected the prescription medication again and advised the drug store to cancel the prescribed medicine again.

Shepherd, who had been hoping to reunite with his ex-spouse, permitted her to pick up an unrelated, regular prescribed medicine refill from the pharmacy. When she stopped at the drug store, the pharmacy staff gave the two prescribed medications to Shepherd’s ex-wife, and the pharmacy employee and his ex-spouse purportedly made fun of the ED medicine. The ex-wife declined the ED prescription, and when she saw Shepherd and handed him his regular medication, she said to him that she found out about the ED drugs and stated that she won’t get back to him. The legal action additionally claims his ex-spouse mentioned the ED medicine with Shepherd’s children and her close friends.

Shepherd sent Costco a complaint regarding the privacy breach, and Costco replied and accepted that the dialogue between the pharmacy staff and Shepherd’s ex-wife concerning the ED medication violated the HIPAA Privacy Rule and provider policies and gave an apology. Shepherd afterward filed a lawsuit in relation to the privacy violation, and the lawsuit cited a breach of the HIPAA Privacy Rule.

With the Federal HIPAA law, there is no private cause of action, meaning people don’t have the right to file suit for a HIPAA violation. The HHS’ Office for Civil Rights and state Attorneys General only may sue HIPAA-covered entities for breach of the Health Insurance Portability and Accountability Act Rules.

The Maricopa County Superior Court sacked the case, as HIPAA doesn’t allow private legal cases and given that state regulations provide protection for healthcare companies for privacy breaches that arise when they’re acting in good faith. Shepherd filed an appeal, however, the Court of Appeals confirmed the discharge of Shepherd’s case, besides the claim of negligent exposure of medical data.

Though there’s no private cause of action in HIPAA, Supreme Court Justice William G. Montgomery decided that the specifications of HIPAA could be employed in state court to show the incidence of privacy violations in negligence claims. Costco had attempted to get the lawsuit dismissed based on the deficiency of a private cause of action, nevertheless, Montgomery mentioned in his decision that Shepherd’s case was not just filed because of violations of the HIPAA Privacy Law. The case furthermore claimed breach of pharmacy policies, for that reason, Superior Court Judge Aimee L. Anderson wrongly terminated the legal action.

Costco asserted that state rules give security for firms acting in good faith and that with no claim of bad faith it’s not probable to demonstrate negligence. Montgomery decided that the legal action did not need to include a claim of bad faith, since Shepherd didn’t know that Costco would assert immunity as per state regulation.

The case was given back to the lower court to continue proceedings. Though the case was revived, Shepherd has to present clear and persuasive proof that the pharmacy and its employee acted in bad faith when revealing the ED medicine to his ex-spouse.

Joshua Carden, Shepherd’s lawyer, is convinced it could prove that this was an instance of bad faith disclosure because the prescribed medication was canceled two times by Shepherd and it can be established that the Costco drug store knew that Shepherd didn’t like the prescribed medicine.