Good afternoon Michael,
I'm Doug, and I'm very sorry to hear of your situation. My goal is to provide you with excellent service today.
Whether there has been a violation of HIPAA would depend completely on the reason that the report was made to the facility director in the first place, and the nature of the communication. If all patients visiting the hospital are not reported to the director---which would of course make no practical sense to do----then the report of the presence of the parents of a staff member would be suspect.
It would seem unlikely that the report was related to any ongoing quality control study, or that the director was directly involved with the treatment of your parents, and therefore it would certainly seem at first blush that, absent a compelling reason the report was made, that HIPAA may very well have been violated by the person making the report to the director.
This is really no different than one staff member talking about a patient to another staff member who was no involved with the treatment of the patient and had no other legitimate reason to be involved with the care of that patient---it is nothing more than gossip, and as such is a HIPAA violation.
A HIPAA violation does not give rise to a private cause of action because the federal government, through the US Department of Health and Human Services, enforces HIPAA violations. However, the same facts which constitute a HIPAA violation can give rise to a meritorious Negligence action and/or Invasion of Privacy action. Your parents could arguably sue for Negligence/Invasion of Privacy based on the dissemination of their private medical information.
You or they might also file a formal complaint with The Joint Commission, which is responsible for certifying health care facilities for eligibility to receive federal payments of health services. If a hospital or large clinic loses certification, they also lose the ability to be paid for MediCare, MediCaid patient treatment---which can force a facility to have to close down. Here is a link to the Joint Commission’s complaint web page: http://www.jointcommission.org/report_a_complaint.aspx
Also, you may report the violation to the US Department of Health and Human Services Here is a link to a website that will assist you in filing a complaint with regard to the unauthorized dissemination of your medical records: http://www.dhhs.gov/ocr/privacy/hipaa/complaints/index.html
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I wish you and yours the best in 2015,