California and Kaiser Agree $49 Million Settlement to Resolve Improper Disposal Lawsuit
The California Attorney General and the district attorneys general from Alameda, San Bernardino, San Francisco, San Joaquin, San Mateo, and Yolo counties have jointly announced a settlement with Kaiser Foundation Health Plan Foundation Inc. and Kaiser Foundation Hospitals (Kaiser) to resolve allegations of improper disposal of hazardous and medical waste and protected health information.
“The illegal disposal of hazardous and medical waste puts the environment, workers, and the public at risk. It also violates numerous federal and state laws,” said Attorney General Rob Bonta. “As a healthcare provider, Kaiser should know that it has specific legal obligations to properly dispose of medical waste and safeguard patients’ medical information. I am pleased that Kaiser has been cooperative with my office and the district attorneys’ offices, and that it took immediate action to address the alleged violations.”
Kaiser was investigated by the district attorneys’ offices, which conducted undercover inspections of dumpsters at 16 Kaiser facilities. The dumpsters were not secured, and their contents were destined for landfill sites. The inspections revealed hazardous and medical waste and paper records containing protected health information were being disposed of with regular trash.
Hundreds of items of hazardous and medical waste were found, including aerosols, cleansers, sanitizers, batteries, electronic wastes, syringes, pharmaceuticals, and medical tubing that contained body fluids. More than 10,000 paper records were discovered that contained the PHI of 7,700 patients. The California Department of Justice subsequently joined the investigation and expanded the investigation to cover Kaiser facilities throughout the state.
Kaiser is alleged to have violated California’s Hazardous Waste Control Law, Medical Waste Management Act, Confidentiality of Medical Information Act, Customer Records Law, and Unfair Competition Law, and the improper disposal of protected health information violated the federal Health Insurance Portability and Accountability Act (HIPAA).
Kaiser is the largest healthcare provider in California, operating more than 700 care facilities in the state and serving more than 8.8 million patients. “As a major corporation in Alameda County, Kaiser Permanente has a special obligation to treat its communities with the same bedside manner as its patients,” said Alameda County District Attorney Pamela Price. “Dumping medical waste and private information are wrong, which they have acknowledged. This action will hold them accountable in such a way that we hope means it doesn’t happen again.”
The settlement includes $47.25 million in civil monetary penalties, attorneys’ fees, and legal costs, plus a further $1.75 million if Kaiser does not spend $3.5 million at its facilities in California over the next 5 years on enhanced environmental compliance measures. The settlement also requires Kaiser to perform no less than 520 trash compactor audits at its California facilities and at least 40 programmatic field audits each year over the next 5 years.