SG Health Plan Resolution Agreement and Corrective Action Plan: Corrective action / RA

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RecitalsParties. The Parties to this Resolution Agreement ("Agreement") are:The United States Department of Health and Human Services, Office for Civil Rights ("HHS"), which enforces 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 l 64, 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"). HHS has the authority to conduct compliance reviews and investigations of complaints alleging violations of the Privacy, Security, and Breach Notification Rules (the "HIPAA Rules") by covered entities and business associates, and covered entities and business associates must cooperate with HHS compliance reviews and investigations. See 45 C.F.R. §§ 160.306(c), 160.308, and 160.310(b).Star Group, L.P. Health Benefits Plan ("SG Health Plan"), which is a health plan and meets the definition of covered entity under 45 C.F.R. § 160.l03 and therefore is required to comply with the HIPAA Rules.HHS and SG Health Plan shall together be referred to herein as the "Parties."Factual Background and Covered ConductOn October 22, 2021, SG Health Plan filed a breach report stating that approximately 9,316 individuals were affected when the SG Health Plan experienced a ransomware attack.HHS's investigation indicated that the following conduct occurred ("Covered Conduct"):SG Health Plan impermissibly disclosed the protected health information of 9,316 individuals. See 45 C.F.R. § 164.502(a).SG Health Plan failed to conduct an accurate and thorough assessment of the potential risks and vulnerabilities to the confidentiality, integrity, and availability of electronic protected health information held by SG Health Plan. See 45 C.F.R. § 164.308(a)(l)(ii)(A)No Admission. This Agreement is not an admission of liability by SG Health Plan.No Concession. This Agreement is not a concession by HHS that SG Health Plan is not in violation of the HIPAA Rules and not liable for civil money penalties.Intention of Parties to Effect Resolution. This Agreement is intended to resolve HHS Transaction Number 22-449105 and any violations of the HIPAA Rules related to the Covered Conduct specified in paragraph 1.2 of this Agreement. In consideration of the Parties' interest in avoiding the uncertainty, burden, and expense of formal proceedings, the Parties agree to resolve this matter according to the Terms and Conditions below.II. Terms and ConditionsPayment. HHS has agreed to accept, and SG Health Plan has agreed to pay HHS, the amount of $245,000 ("Resolution Amount"). SG Health Plan agrees to pay the Resolution Amount in one-lump sum within seven (7) days of the Effective Date of this Agreement as defined in paragraph II.14 pursuant to written instructions to be provided by HHS.Corrective Action Plan. SG Health Plan has entered into and agrees to comply with the Corrective Action Plan ("CAP"), attached as Appendix A, which is incorporated into this Agreement by reference. IfSG Health Plan breaches the CAP and fails to cure the breach as set forth in the CAP, then SG Health Plan will be in breach of this Agreement and HHS will not be subject to the Release set forth in paragraph 11.8 of this Agreement.Release by HHS. In consideration of and conditioned upon SG Health Plan's performance of its obligations under this Agreement, HHS releases SG Health Plan from any actions it may have against SG Health Plan under the HIPAA Rules arising out of or related to the Covered Conduct identified in paragraph 1.0 of this Agreement. HHS does not release SG Health Plan from, nor waive any rights, obligations, or causes of action other than those arising out of or related to the Covered Conduct and referred to in this paragraph. This release does not extend to actions that may be brought under section 1177 of the Social Security Act, 42 U.S.C. § 1320d-6.Agreement by Released Parties. SG Health Plan shall not contest the validity of its obligation to pay, nor the amount of, the Resolution Amount or any other obligations agreed to under this Agreement. SG Health Plan 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, and HHS claims collection regulations at 45 C.F.R. Part 30, including, but not limited to, notice, hearing, and appeal with respect to the Resolution Amount.Binding on Successors. This Agreement is binding on SG Health Plan and its successors, heirs, transferees, and assigns.Costs. Each Party to this Agreement shall bear its own legal and other costs incurred in connection with this matter, including the preparation and performance of this Agreement.No Additional Releases. 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.Effect of Agreement. This Agreement constitutes the complete agreement between the Parties. All material representations, understandings, and promises of the Parties are contained in this Agreement. Any modifications to this Agreement shall be set forth in writing and signed by all Parties.Execution of Agreement and Effective Date. The Agreement shall become effective (i.e., final and binding) upon the date of signing of this Agreement and the CAP by the last signatory (Effective Date).Tolling of Statute of Limitations. Pursuant to 42 U.S.C. § 1320a-7a(c)(l), a civil money penalty ("CMP") must be imposed within six years from the date of the occurrence of the violation. To ensure that this six-year period does not expire during the term of this Agreement, SG Health Plan agrees that the time between the Effective Date of this Agreement and the date the Agreement may be terminated by reason of SG Health Plan's breach, plus one-year thereafter, will not be included in calculating the six (6) year statute of limitations applicable to the violations which are the subject of this Agreement. SG Health Plan waives and will not plead any statute of limitations, !aches, or similar defenses to any administrative action relating to the Covered Conduct identified in paragraph 1.2 that is filed by HHS within the time period set forth above, except to the extent that such defenses would have been available had an administrative action been filed on the Effective Date of this Agreement.Disclosure. HHS places no restriction on the publication of the Agreement.Execution in Counterparts. This Agreement may be executed in counterparts, each of which constitutes an original, and all of which shall constitute one and the same agreement.Authorizations. The individual(s) signing this Agreement on behalf of SG Health Plan represents and warrants that they are authorized to execute this Agreement and bind SG Health Plan, as set forth in paragraph I.l .b. The individual(s) signing this Agreement on behalf of HHS represent and warrant that they are signing this Agreement in their official capacities and that they are authorized to execute this Agreement.For Star Group L.P., Health Benefits Piao (SG Health Plan)/s/Robert ClarkDirector of Employee Benefits, HIPAA Privacy OfficerStar Group, L.P. Health Benefits PlanDate: 1/8/26For U.S. Department of Health and Human Services/s/Barbara StampulRegional Manager Office for Civil RightsDate: 1/22/2026Appendix ACORRECTIVE ACTION PLANBETWEEN THEU.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES ANDSTAR GROUP, L.P. HEALTH BENEFITS PLANI. PreambleStar Group, L.P. Health Benefits Plan ("SG Health Plan") hereby enters into this Corrective Action Plan ("CAP'') with the United States Department of Health and Human Services, Office for Civil Rights ("HHS"). Contemporaneously with this CAP, SG Health Plan is entering into the Agreement with HHS, and this CAP is incorporated by reference into the Agreement as Appendix A. SG Health Plan enters into this CAP as part of consideration for the release set forth in paragraph Il.8 of the Agreement. Capitalized terms without definition in this CAP shal1have the same meaning assigned to them under the Agreement.II. Contact Persons and SubmissionsContact PersonsThe contact person for SG Health Plan regarding the implementation of this CAP and for receipt and submission of notifications and reports (''SG Health Plan Contact") is:NAME Kimberly Gordy, Outside Counsel, BakerHostetlerADDRESS 811 Main Street Suite 1100, Houston, TX 77002EMAIL ███████ TELEPHONE ███████HHS has identifled the following individual as its authorized representative and contact person with whom SG Health Plan is to report information regarding the implementation of this CAP:Ms. Barbara Stampul, Regional ManagerOffice for CiviI RightsU.S. Department of Health and Human ServicesSam Nunn Atlanta Federal Center, Suite 16T7061 Forsyth Street, S.W.Atlanta, GA 30303-8909SG Health Plan and HHS agree to promptly notify each other of any changes in the contact person or the other information provided above.Proof of Submissions. Unless otherwise specified, all notifications and reports 'required by this CAP may be made by any means, including certified mail, overnight mail, electronic mail, or hand delivery, provided that there is proof that such notification was received. For purposes of this requirement, internal facsimile confirmation sheets do not constitute proof of receipt.III. Effective Date and Term of CAPThe Effective Date for this CAP shall be calculated in accordance with paragraph II.14 of the Agreement ("Effective Date"). The period for compliance ("Compliance Term") with the obligations assumed by SG Health Plan under this CAP shall begin on the Effective Date of this CAP and end two (2) years from the Effective Date, unless HHS has notified SG Health Plan under section VIII hereof of its determination that SG Health Plan breached this CAP. In the event of such a notification by HHS under section IX hereof, the Compliance Term shall not end until HHS notifies SG Health Plan that it has determined that the breach has been cured. After the Compliance Term ends, SG Health Plan shall still be obligated to: (a) submit the final Annual Report as required by section VII; and (b) comply with the document retention requirement in section VIII. Nothing in this CAP is intended to eliminate or modify SG Health Plan's obligation to comply with the document retention requirements in 45 C.F.R. §§ 164.316(b) and 164.5300).IV. TimeIn computing any period of time prescribed or allowed by this CAP, all days referred to shall be calendar days. The day of the act, event, or default from which the designated period of time begins to run shall not be included. The last day of the period so computed shall be included, unless it is a Saturday, a Sunday, or a legal holiday, in which event the period runs until the end of the next day which is not one of the aforementioned days.V. Corrective Action ObligationsSG Health Plan agrees to the following:Security Management ProcessSG Health Plan shall conduct a comprehensive and thorough Risk Analysis of the potential risks and vulnerabilities to the confidentiality, integrity, and availability of electronic protected health information (ePHI) held by SG Health Plan. This Risk Analysis shall evaluate the risks to the ePHI on all of its electronic equipment, data systems, and applications controlled, administered or owned by SG Health Plan, that contain, store, transmit, or receive ePHI. Prior to conducting the Risk Analysis, SG Health Plan shall develop a complete inventory of all of its facilities, electronic equipment, data systems, and applications that contain or store ePHI that will then be incorporated into its Risk Analysis. SG Health Plan shall provide documentation supporting a review of current security measures and level of risk to its ePHI associated with the following: network segmentation; network infrastructure; vulnerability scanning; logging and alerts; and patch management. Further, SG Health Plan shall review whether adequate separation exists between the plan sponsor and group health plan.SG Health Plan shall provide the Risk Analysis, consistent with section V.A.1, to HHS within ninety (90) days of the Effective Date for HHS's review. If HHS disapproves of the Risk Analysis, HHS shall provide SG Health Plan with technical assistance, as necessary, regarding the basis for disapproval so that SG Health Plan may prepare a revised Risk Analysis. Upon receiving notice of any recommended changes, SG Health Plan shall have sixty (60) days in which to revise its Risk Analysis and submit the revised Risk Analysis to HHS for review and approval. This submission and review process shall continue until HHS approves the Risk Analysis.SG Health Plan shall develop an enterprise-wide Risk Management Plan to address and mitigate any security risks and vulnerabilities found in the Risk Analysis described above. The Risk Management Plan shall include a process and timeline for SG Health Plan's implementation, evaluation, and revision of its risk remediation activities. SG Health Plan may submit a Risk Management Plan currently underway for consideration by HHS for compliance with this provision.Within ninety (90) days of HHS's final approval of the Risk Analysis described in section V.A above, SG Health Plan shall submit SG Health Plan's Risk Management Plan to HHS for HHS's review. If HHS disapproves of the Risk Management Plan, HHS shall provide SG Health Plan with technical assistance, as necessary, so that SG Health Plan may prepare a revised Risk Management Plan. Upon receiving notice of any recommended changes, SG Health Plan shall have sixty (60) days in which to revise its Risk Management Plan and submit the revised Risk Management Plan to HHS for review and approval. This submission and review process shall continue until HHS approves the Risk Management Plan. Within thirty (30) days of HHS's approval of the Risk Management Plan, SG Health Plan shall begin implementation of the Risk Management Plan and distribute the plan to workforce members involved with implementation of the plan.Policies and ProceduresSG Health Plan shall review and revise, as necessary, its written policies and procedures to comply with the Federal standards that govern the privacy of individually identifiable health information and/or the security standards for the protection of electronic protected health information (45 C.F.R. Parts 160 and 164, Subparts A, C, and E, the Privacy and Security Rules) and the Federal standards for notification in the case of breach of unsecured protected health information (45 C.F.R. Part 160 Subparts A and D of 45 C.F.R. Part 164, the "Breach Notification Rule"). SG Health Plan's policies and procedures shall include, but not be limited to, the Minimum Content set forth in section V.D.SG Health Plan shall provide the policies and procedures identified in section V.B.l above to HHS for review and approval within sixty (60) days of HHS's approval of its Risk Management Plan, as required by A.4. Upon receiving notice of any recommended changes, SG Health Plan shall have thirty (30) days to revise such policies and procedures and provide the revised policies and procedures to HHS for review and approval. This process shall continue until HHS approves such policies and procedures.SG Health Plan shall adopt (in accordance with its applicable administrative procedures) the policies and procedures approved by HHS pursuant to section V.B.2 within thirty (30) days of receipt of HHS's approval.Distribution of Policies and ProceduresSG Health Plan shall distribute the policies and procedures identified in section V.B. to all members of the SG Health Plan's workforce who use or disclose ePHI within thirty (30) days of HHS approval of such policies and procedures, and thereafter to new members of the workforce who will use or disclose ePHI within thirty (30) days of their becoming a member of the workforce.Minimum Content of the Policies and ProceduresThe Policies and Procedures shall include, but not be limited to:Measures that address the following Security Rule provisions:Information System Activity Review- 45 C.F.R. § 164.308(a)(l)(ii)(D), including a process(es) for the regular review of all records of information system activity collected by SG Health Plan and processes for evaluating when the collection of new or different records needs to be included in the review; SG Health Plan will ensure that the process will be expansive enough to review access to local devices and ensure that its external firewall will be up to date with the necessary security patches, and configuration to adequately review external threats;Access Establishment and Modification - 45 C.F.R. § 164.308(a)(4)(ii)(C), including implementing policies and procedures to establish or modify access to ePHI;Security Awareness and Training- 45 C.F.R. § 164.308(a)(5)(i), including implementing a security awareness and training program for all members of its workforce (including management);Security Incident Procedures - 45 C.F.R. § 164.308(a)(6)(i), including implementing policies and procedures to address security incidents;Data Backup Plan- 45 C.F.R. § 164.308(a)(7)(ii)(A), including a process for creating and maintaining retrievable exact copies of SG Health Plan's PHI. SG Health Plan will ensure the plan accounts for situations where its data has been lost;Access Control-45 C.F.R. § 164.312(a)(l), including implementing policies and procedures for electronic information systems that maintain ePHI to allow access only to those persons or software programs that have been granted access rights; andAudit Controls - 45 C.F.R. § 164.312(b), including implementing policies and procedures to record and examine activity in its systems that maintain ePHI.Measures that address the following Breach Notification Rule provisions:Breach Notification to Individuals -45 C.F.R. § 164.404(a), including implementing policies and procedures to timely notify each individual whose unsecured PHI has been, or is reasonably believed to have been, accessed, acquired, used, or disclosed as a result of a breach; andBreach Notification to the Secretary-45 C.F.R. § 164.408(a), including implementing policies and procedures to timely notify the Secretary of a breach of unsecured PHI.TrainingSG Health Plan shall provide HHS with its HIPAA training materials for all members of the workforce that have access to PHI within thirty (30) days of the adoption of those policies and procedures described section V.8.3.Upon receiving notice of any recommended changes, SG Health Plan shall provide revised training materials to HHS within thirty (30) days.Within sixty (60) days after receiving HHS's final approval and at least every 12 months thereafter, SG Health Plan shall provide training for each workforce member who has access to PHI. SG Health Plan shall also provide such training to each new member of the workforce who has access to PHI within thirty (30) days of their beginning of service.Each SG Health Plan workforce member who is required to attend training shall certify, in electronic or written form, that he or she has received the training. The training certification shall specify the date training was received. All course materials shall be retained in compliance with section VII.SG Health Plan shall review the training at least annually, and, where appropriate, update the training to reflect changes in Federal law or HHS guidance, any issues discovered during audits or reviews, and any other relevant developments.VI. Reportable EventsReportable Events. After the implementation of the Policies and Procedures in accordance with paragraph V.B.3, SG Health Plan shall, during the remainder of the Compliance Term, upon receiving information that a workforce member may have failed to comply with such policies and procedures, promptly investigate the matter. If SG Health Plan, after review and investigation, determines that a member of its workforce has failed to comply with such policies and procedures, SG Health Plan shall report such event(s) to HHS as provided in section VII.BA. Such violations shall be known as "Reportable Events." The report to HHS shall include the following:A complete description of the event, including the relevant facts, the persons involved, and the provision(s) of the Policies and Procedures implicated; andA description of the actions taken and any further steps SG Health Plan plans to take to address the matter to mitigate any harm, and to prevent it from recurring, including application of appropriate sanctions against workforce members who failed to comply with the Policies and Procedures.VII. Training Report and Annual ReportsTraining Implementation Report. Within one hundred and twenty ( 120) days after the receipt of HHS's approval of the training required by section V.E, SG Health Plan shall submit a written report to HHS known as the "Training Implementation Report," which shall consist of:A copy of all training materials used for the training required by this CAP, a description of the training including a summary of the topics covered, the length of the session(s) and a schedule of when the training session(s) were held; Evidence of policy implementation that sufficiently demonstrates SG Health Plan's compliance with requirements of the CAP.An attestation signed by an officer or director of SG Health Plan that all applicable members of the workforce of SG Health Plan have completed the initial training required by section V.E and have executed the training certifications required by paragraph V.E.4.Annual Reports. The one (I) year period after the Effective Date and each subsequent one (I) year period during the course of the Compliance Term shall be known as a "Reporting Period." Within sixty (60) days after the close of each corresponding Reporting Period, SG Health Plan shall submit a report or reports to HHS regarding SG Health Plan's compliance with this CAP for each corresponding Reporting Period ("Annual Report''). The Annual Report shall include:A copy of the schedule, topic outline, and training materials for the training programs provided during the Reporting Period that is the subject of the Annual Report;An attestation signed by an officer or director of SO Health Plan attesting that SO Health Plan obtain and maintain written or electronic training certifications from all persons who are required to attend training under this CAP;An attestation signed by an officer or director of SO Health Plan attesting that any revision(s) to the Policies and Procedures required by section V.B were finalized and adopted within thirty (30) days of HHS's approval of the revision(s), which shall include a statement affirming that SO Health Plan distributed the revised Policies and Procedures to all appropriate members of SO Health Plan's workforce within sixty (60) days of HHS 's approval of the revision(s); andA summary of Reportable Events, if any, the status of any corrective and preventative action(s) relating to all such Reportable Events, or an attestation signed by an officer or director of SO Health Plan stating that no Reportable Events occurred during the Compliance Term.VIII. Document RetentionSG Health Plan shall maintain for inspection and copying, and shall provide to HHS, upon request, all documents and records relating to compliance with this CAP for six (6) years from the Effective Date.IX. Breach ProvisionsSG Health Plan is expected to fully and timely comply with all provisions contained in this CAP.Timely Written Requests for Extensions. SG Health Plan may, in advance of any due date set forth in this CAP, submit a timely written request for an extension of time to perform any act required by this CAP. A "timely written request" is defined as a request in writing received by HHS at least five (5) days prior to the date such an act is required or due to be performed. This requirement may be waived by HHS only.Notice of Breach of this CAP and Intent to Impose CMP. The Parties agree that a breach of this CAP by SG Health Plan constitutes a breach of the Agreement. Upon a determination by HHS that SG Health Plan has breached this CAP, HHS may notify SG Health Plan Contact of: (I) SO Health Plan's breach; and (2) HHS's intent to impose a CMP pursuant to 45 C.F.R. Part 160, for the Covered Conduct set forth in paragraph 1.2 of the Agreement and any other conduct that constitutes a violation of the HIPAA Privacy, Security, or Breach Notification Rules ("Notice of Breach and Intent to Impose CMP").SG Health Plan's Response. If SG Health Plan is named in a Notice of Breach and Intent to Impose CMP, SG Health Plan shall have thirty (30) days from the date of receipt of the Notice of Breach and Intent to Impose CMP to demonstrate to HHS's satisfaction that:SG Health Plan is in compliance with the obligations of the CAP that HHS cited as the basis for the breach;The alleged breach has been cured; orThe alleged breach cannot be cured within the thirty (30) day period, but that SG Health Plan: (a) has begun to take action to cure the breach; (b) is pursuing such action with due diligence; and (c) has provided to HHS a reasonable timetable for curing the breach.Imposition of CMP. If at the conclusion of the thirty (30) day period, SG Health Plan fails to meet the requirements of section IX.C of this CAP to HHS's satisfaction, HHS may proceed with the imposition of a CMP against SG Health Plan pursuant to the rights and obligations set forth in 45 C.F.R. Part 160 for any violations of the HIPAA Rules applicable to the Covered Conduct set forth in paragraph l.2 of the Agreement and for any other act or failure to act that constitutes a violation of the HIPAA Rules. HHS shall notify SG Health Plan Contact in writing of its determination to proceed with the imposition of a CMP pursuant to 45 C.F.R. §§ 160.312(a)(3)(i) and (ii).For Star Group, L.P. Health Benefits Plan/s/Robert ClarkDirector of Employee Benefits, HlPAA Privacy OfficerStar Group, L.P. Health Benefits PlanDate: 1/8/2026For U.S. Department of Health and Human Services/s/Barbara StampulRegional Manager Office for Civil RightsDate: 1/22/2026 Content last reviewed April 23, 2026