New Jersey Governor Chris Christie signed a bill (S.562) into law on January 9, 2015 that will impose a standard more stringent than HIPAA on health insurance carriers authorized (i.e., licensed) to issue health benefits plans in New Jersey. Effective August 1, 2015, such carriers will be required to secure computerized records that include certain personal information by encryption (or by any other method or technology rendering the information unreadable, undecipherable, or otherwise unusable by an unauthorized person). “Personal information” requiring encryption includes an individual’s first name or first initial and last name when linked with any one or more of the following data elements:
* Social security number
* Driver’s license number or State identification card number
* Individually identifiable health information as defined under HIPAA
Notably, the encryption requirement applies only to “end user computer systems” and “computerized records transmitted across public networks”, as those terms are defined in the law. “End user computer systems” are defined as computer systems “designed to allow end users to access computerized information, computer software, computer programs, or computer networks” and include “desktop computers, laptop computers, tables or other mobile devices, or removable media.”
The law is more stringent than HIPAA not only because it requires encryption, but because it applies to personal data that is more rudimentary than the type of data that constitutes protected health information (PHI) under HIPAA. For example, under the new law, if a health insurance carrier compiles or maintains a computerized record that contains an individual’s first initial, last name, and address (and this information is not publicly available in a directory listing to which the individual has consented, which effectively excludes the information from the law’s definition of a “record”), the encryption requirement would apply even if the individual is not covered (insured) by the carrier. A health insurance carrier subject to this new law that is building a mailing list of prospective customers or otherwise collecting information about individuals who are not plan members or insureds will need to make sure its encryption capabilities encompass not only existing or future members’ PHI, but any and all “personal information” that is compiled or maintained.