For decades, 42 CFR Part 2 created stricter privacy requirements for substance use disorder (SUD) records but lacked HIPAA’s robust penalty framework. That changed in February 2024, when HHS finalized updates aligning Part 2 with HIPAA.
By February 16, 2026, SUD programs will face HIPAA-style penalties for violations. That means higher financial risk, breach notification obligations, and increased regulatory oversight.
Here’s what to expect — and how to prepare.
The New Penalty Structure
- Civil penalties: Now aligned with HIPAA tiers — up to $50,000 per violation, capped annually.
- Criminal penalties: Knowing misuse of SUD records can carry criminal liability.
- Breach notification: HIPAA timelines apply (generally 60 days to notify affected individuals + regulators).
Why This Matters for SUD Providers
- Insurance premiums: Carriers are already asking for proof of IRP/BCP, redisclosure logs, and staff training. Gaps = higher premiums or denial.
- Board oversight: Executives have fiduciary duties; failing to address Part 2 compliance could lead to liability.
- Operational trust: SUD carries stigma. Breaches erode patient trust, and fines amplify the fallout.
Practical 60-Day Action Plan
- Update breach response plan to reflect HIPAA timelines.
- Draft communication templates (patient letters, regulator notices, press releases).
- Conduct a tabletop exercise simulating a Part 2 breach — capture logs and board summaries.
- Centralize incident logging so investigations are auditable.
- Engage insurers proactively with proof of readiness to negotiate premiums.
Common Pitfalls
- Thinking fines “won’t apply to small programs” (they will).
- Waiting until 2026 to run the first tabletop.
- No breach communication templates prepared in advance.
How Huntleigh Helps
Our Turnkey Part 2 Readiness Package includes:
- HIPAA-aligned breach playbook & notification templates
- Incident logging and disclosure tracking
- Tabletop exercise with board-ready reporting
- Insurance artifact package to reduce premium risk
Don’t gamble with HIPAA-level penalties. Download our free checklist and book your Part 2 Readiness Assessment today.
👉 https://huntleigh.com/part2-readiness
