What happens when a fundamentally flawed entitlement program that threatens to usurp one sixth of the U.S. economy runs up against a scandal involving the government’s second most powerful enforcement agency? The answer is a class-action lawsuit filed by a California HMO alleging that 60 million medical records from 10 million patients were stolen by the IRS.
Healthcare IT News (via Courthouse News Service) writes that an unnamed HIPAA-covered entity in the Golden State is bringing the action against 15 IRS agents. “The personal health information seized on March 11, 2011, included psychological counseling, gynecological counseling, sexual/drug treatment and other medical treatment data.”
The complaint states:
This is an action involving the corruption and abuse of power by several Internal Revenue Service agents. No search warrant authorized the seizure of these records; no subpoena authorized the seizure of these records; none of the 10,000,000 Americans were under any kind of known criminal or civil investigation and their medical records had no relevance whatsoever to the IRS search. IT personnel at the scene, a HIPPA facility warning on the building and the IT portion of the searched premises, and the company executives each warned the IRS agents of these privileged records.
According to the case, the IRS agents had a search warrant for financial data pertaining to a former employee of the John Doe company. However, no authorization for the seizure of any healthcare or medical record of any persons was given, least of all third parties completely unrelated to the matter.
Complainants are seeking $25,000 in compensatory damages “per violation per individual,” plus punitive damages for constitutional violations.
The case comes at a time when the Obama administration is already under siege for three separate scandals, one relating to the Benghazi consulate attacks, one that alleges that the IRS has been scrutinizing the records of conservative-minded tax-exempt groups, and one involving what may be an overly broad use of power by the Justice Department in examining the records of the Associated Press.