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Please use the following to answer the next QUESTION:

You are the chief privacy officer at HealthCo, a major hospital in a large U.S. city in state A. HealthCo is a

HIPAA-covered entity that provides healthcare services to more than 100,000 patients. A third-party cloud

computing service provider, CloudHealth, stores and manages the electronic protected health information

(ePHI) of these individuals on behalf of HealthCo. CloudHealth stores the data in state B. As part of

HealthCo’s business associate agreement (BAA) with CloudHealth, HealthCo requires CloudHealth to

implement security

measures, including industry standard encryption practices, to adequately protect the data. However, HealthCo

did not perform due diligence on CloudHealth before entering the contract, and has not conducted audits of

CloudHealth’s security measures.

A CloudHealth employee has recently become the victim of a phishing attack. When the employee

unintentionally clicked on a link from a suspicious email, the PHI of more than 10,000 HealthCo patients was

compromised. It has since been published online. The HealthCo cybersecurity team quickly identifies the

perpetrator as a known hacker who has launched similar attacks on other hospitals – ones that exposed the PHI

of public figures including celebrities and politicians.

During the course of its investigation, HealthCo discovers that CloudHealth has not encrypted the PHI in

accordance with the terms of its contract. In addition, CloudHealth has not provided privacy or security

training to its employees. Law enforcement has requested that HealthCo provide its investigative report of the

breach and a copy of the PHI of the individuals affected.

A patient affected by the breach then sues HealthCo, claiming that the company did not adequately protect the

individual’s ePHI, and that he has suffered substantial harm as a result of the exposed data. The patient’s

attorney has submitted a discovery request for the ePHI exposed in the breach.

What is the most significant reason that the U.S. Department of Health and Human Services (HHS) might

impose a penalty on HealthCo?

Because HealthCo did not require CloudHealth to implement appropriate physical and administrative

measures to safeguard the ePHI

Acme Student Loan Company has developed an artificial intelligence algorithm that determines whether an

individual is likely to pay their bill or default. A person who is determined by the algorithm to be more likely

to default will receive frequent payment reminder calls, while those who are less likely to default will not

receive payment reminders.

Which of the following most accurately reflects the privacy concerns with Acme Student Loan Company using

artificial intelligence in this manner?

If the algorithm uses risk factors that impact the automatic decision engine. Acme must ensure that the

algorithm does not have a disparate impact on protected classes in the output.

If the algorithm makes automated decisions based on risk factors and public information, Acme need not

determine if the algorithm has a disparate impact on protected classes.

If the algorithm’s methodology is disclosed to consumers, then it is acceptable for Acme to have a

disparate impact on protected classes.

If the algorithm uses information about protected classes to make automated decisions, Acme must

ensure that the algorithm does not have a disparate impact on protected classes in the output.

Which of the following best describes an employer’s privacy-related responsibilities to an employee who has

An employer has a responsibility to maintain a former employee’s access to computer systems and

company data needed to support claims against the company such as discrimination.

An employer has a responsibility to permanently delete or expunge all sensitive employment records to

minimize privacy risks to both the employer and former employee.

An employer may consider any privacy-related responsibilities terminated, as the relationship between

employer and employee is considered primarily contractual.

An employer has a responsibility to maintain the security and privacy of any sensitive employment

records retained for a legitimate business purpose.

Which of the following is an important implication of the Dodd-Frank Wall Street Reform and Consumer

Financial institutions must help ensure a customer’s understanding of products and services

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