Cannabis Dispensaries and the Health Insurance Portability and Accountability Act of 1996, as amended (“HIPAA”) – Part I

Clients have often as asked whether HIPAA applies to the cannabis industry. As with anything else in healthcare, the answer can be complex. HIPAA was enacted in 1996 to help protect a patient’s healthcare information. While HIPAA is expansive, to the extent state law is more restrictive or protective, then state law will control in those instances. 45 CFR § 160.201 et. seq. But the first question is whether HIPAA applies to the cannabis industry.

Are Cannabis Dispensaries Covered Entities?

For information to be protected under HIPAA, there are several aspects to analyze. Boiled down to its basics, HIPAA will apply when a “Covered Entity” has “Protected Health Information”. As with any other statutory regime, the first place to start with the analysis are the definitions. A “covered entity” includes a health plan (e.g., a third-party payor), a health care clearinghouse (e.g., a third-party system that interprets claims data between healthcare provider systems and third-party payers), and a health care provider. 45 CFR § 160.103. So, is a dispensary a “health care provider”? For adult use or recreational dispensaries, the answer is no. However, for medical marijuana dispensaries, a deeper dive into the HIPAA regulations is essential.

A health care provider is defined to include, (1) a provider of services, as defined in the Social Security Act, (2) a provider of medical or health care services, again, as defined in the Social Security Act, and (3) any other person or organization who furnishes, bills, or is paid for health care in the normal course of business. Id. Under this definition, clearly a hospital, physician, healthcare clinic and many other types of healthcare providers are covered entities.

But a dispensary is not of the entities specifically enumerated under the statute. Does this mean a medical marijuana dispensary is not a health care provider? No. To help illuminate the definition of a health care provider, it is also important to understand the definition of “health care”. As the HIPAA regulations state, “health care means care, services, or supplies related to the health of an individual.” Id. The regulations then provide specific examples (that are not intended to be all-inclusive) of health care. Overall, health care includes:

(1) Preventive, diagnostic, therapeutic, rehabilitative, maintenance, or palliative care, and counseling, service, assessment, or procedure with respect to the physical or mental condition, or functional status, of an individual or that affects the structure or function of the body; and

(2) Sale or dispensing of a drug, device, equipment, or other item in accordance with a prescription. Id.

Under either of the foregoing sections, an argument can be made that medical marijuana dispensaries are health care providers. Depending upon which state you live in, medical marijuana may be “prescribed” for “therapeutic” or “palliative” care. See, e.g., A.R.S. 36-2801(11) (In Arizona, “‘Medical use’ means the acquisition, possession, cultivation, manufacture, use, administration, delivery, transfer or transportation of marijuana or paraphernalia relating to the administration of marijuana to treat or alleviate a registered qualifying patient’s debilitating medical condition or symptoms associated with the patient’s debilitating medical condition.”). Moreover, when a “prescription” is required to attain medical marijuana, then certainly the second part of the above definition would apply (e.g., the “sale or dispensing of a[n]” “item in accordance with a prescription.”).

A cogent argument can be made that a medical marijuana dispensary is a covered entity under HIPAA. The ultimate determination is made on a case-by-case basis and state laws play an integral role in assessing these issues.

Protected Health Information

The second part of the analysis is whether a medical marijuana dispensary possesses “protected health information”. As with the above analysis, definitions are the starting point.

HIPAA defines “protected health information” to mean individually identifiable health information: that is: (1) transmitted by electronic media; (2) maintained in electronic media; or (3) transmitted or maintained in any other form or medium. Id. Thus, before analyzing the applicability of protected health information in the cannabis context, the definition of “individually identifiable health information” is essential. Individually identifiable health information includes –

Demographic information collected from an individual, and: (1) is created or received by a health care provider, health plan, employer, or health care clearinghouse; and (2) relates to the past, present, or future physical or mental health or condition of an individual; the provision of health care to an individual; or the past, present, or future payment for the provision of health care to an individual; and (i) that identifies the individual; or (ii) with respect to which there is a reasonable basis to believe the information can be used to identify the individual. Id.

Certainly, a medical marijuana dispensary could very well maintain protected health information. For example, if the dispensary maintains information that includes the patient’s name, social security number and/or any other identifying information, as well as the patient’s diagnosis and purchase information, then it is not a stretch to see how HIPAA would apply.

What Does a Dispensary Need to Do if it is a Covered Entity?

While the foregoing is primarily an academic exercise, instituting HIPAA compliant protections is much more practical. The Office of Civil Rights (“OCR”), which is housed in the U.S. Department of Health and Human Services, is the regulatory authority under HIPAA. The OCR has the power to assess monetary penalties for HIPAA breaches, which can be quite significant. Moreover, a breach under HIPAA can lead to lawsuits by the affected patients under various legal theories, including invasion of privacy and other tort claims.

To avoid HIPAA breaches, some of the basic actions include implementing comprehensive policies and procedures and educating the dispensary’s staff on a regular basis. Moreover, a dispensary owner would be wise to procure cyber-liability insurance in the event of HIPAA breach. In future posts, we will detail more of the requirements under HIPAA.

HIPAA is a complex statute. As noted above, there is also an interplay with state law which makes the analysis even more complex. A medical marijuana dispensary owner would be wise to seek counsel on whether HIPAA applies, and if so, how to come into compliance with HIPAA (and possibly state privacy laws as well).

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Mellow out with these 7 hemp prerolls

Now that 4/20 has come and gone, you may be feeling a little greened out. So if you’re looking to take the edge off without any intoxicating elements, consider the classic hemp preroll. Though the effects don’t hit you as hard as a hefty dose of THC, a few hits of cannabidiol (CBD) flower may loosen you up and give you a sigh of relief at the end of a long day. 

Thankfully, since hemp is federally legal in the U.S., you can order CBD flower and joints in a way most convenient for you. Below, check out seven hemp prerolls made for kicking back and letting go. 

CBD+Herb Minis from Miss Grass

Each CBD mini preroll pack from Miss Grass is loaded with organic full-spectrum hemp containing CBD and CBG and a unique blend of adaptogenic herbs. You can choose from the XXX pack for pleasure, ZZZ pack for sleep, and the OOO pack for balance. Or go for all three for an ultra-mellow sampling. Customer reviews boast smooth hits and bright flavors. 

Price: $26 per pack or $63 for the trio

Special Sauce 3-Pack Prerolls from Friend Leaf 

Sun-grown and USDA certified organic, Friend Leaf’s CBD prerolls come with 2 grams of flower in each three-pack offering. Its Special Sauce strain delivers notes of pine and hops while lightly relaxing the body and mind. 

Price: $26

Slim Hemp CBD 14-Pack Prerolls from Alive and Kicking 

If you regularly microdose CBD, then you may get a kick out of Alive and Kicking’s Slim Hemp Prerolls. Each mini preroll contains 0.3 grams of third-party tested whole flower hemp, so you won’t be getting any stems or pesticides here. Choose from three strains — Lifter, ACDC, and Orange Glaze — before lighting up on a breezy day.   

Price: $29

Lit for a Queen CBD Preroll and Lighter from Her Highness 

Offering a CBD preroll with an extra long filter to save your nails, Her Highness knows how to treat cannabis with a healthy dose of luxury and self-care. The preroll-and-lighter combo pack contains a single joint of Cherry Blossom flower in a cherry-blossom-flavored hemp wrap, along with a gold lighter that will last — save for the butane.

Price: $15

Something’s Fishy 5-Pack from Dad Grass

Discreet and charming, this five-pack from Dad Grass comes in a sardine packaging sleeve to throw off your friends, neighbors, and kids. Loaded with five classic hemp joints, the hits are mellow and smooth.

Price: $37

Premium Hemp Cigarettes 21-Pack from The Botanical Joint

Latina and indigenous-owned, The Botanical Joint boasts 0.75 gram CBD joints in a 21-pack tin. Each of its strains is tested with a robust terpene analysis that speaks to the quality of The Botanical Joint’s hemp flower. 

Price: $30

Featured image by Gina Coleman/Weedmaps

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CBD Oil for Cats With Anxiety — Does It Really Work?

If you are a concerned pet owner, you might have heard about CBD. Many people around the world use this non-psychoactive substance to keep their pets happy and healthy. However, you might not know that CBD oil can also help your cat cope with anxiety and some other issues. If your cat is aggressive, hides […]

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Bill C-10: The End of Cannabis Content?

In The Once and Future Canadian Democracy, Canadian scholar Janet Ajzenstat writes, “It follows that true Canadians will favour gun control as a matter of course. It’s in keeping with our identity. But think! What about those opposed? Are we supposed to regard them as less than fully Canadian?”According to Justin Trudeau’s Liberals, the answer […]

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We’ve still got it: BC continues to be at the forefront of cannabis research

The Canadian province of British Columbia (BC) is well known for its cannabis, once infamously coined BC Bud. For the most part, the province is still home to some of North America’s highest quality cultivars of cannabis. Will research and development allow BC to jump ahead with its cannabis reputation? BC Bud booms – climate […]

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5 weed products that Cannaclusive co-founder Mary Pryor can’t live without

The weed industry needs people like Mary Pryor. People that will keep it real about how twisted, corrupt, and out of balance the game has always been. Without complete truth about the lack of funding, the difficulties of licensing, and the constant fight for social justice, there will never be any real progress made towards correcting all of the issues brought on by the failed War on Drugs.

“I don’t think I’m the shit; I don’t think I’m killing it; but I do think that I talk about how there’s not a lot of Black and brown presence in [the cannabis industry], in a way that’s alarming, hopefully inspiring,” Pryor told me during a recent Zoom interview.

Pryor is the co-founder of Cannaclusive, a collective aimed at facilitating fair representation of minority cannabis consumers. She’s also a co-founder of Fit For Us, a non-profit aimed at highlighting minority professionals in the health and wellness industry space, Breaking Bread NYC, a non-profit focused on food scarcity, Cannabis For Black Lives, a non-profit coalition of white-owned companies aimed at putting dollars behind Black and brown employment and organizations in the cannabis space; and The National Cannabis Industry Association. Additionally, she works as the Chief Marketing Officer for Tonic CBD, a CBD skin care line. By the time this article is published, she’ll probably have two or three more jobs added to the resume, that’s how dedicated she is to creating paths for Black and brown folks in a world that continues to try to erase us.

When asked why she chose to enter the cannabis industry in the first place, Pryor said, “I got into it from a health perspective. I have [Crohn’s Disease], cannabis provided a lot of relief for me.” Being an advocate for the plant caused her to look at the legal industry surrounding it and wonder why none of the people in power looked like the people sitting in jail for being involved with the exact same product. “I realized that there weren’t enough Black people in an industry that felt pretty Black in my experience. So I was really into the idea of talking about that and uplifting [Black and brown people]. I didn’t know it would lead me all the way to where I am now.”

Pryor’s most known for her work with Cannaclusive, who’ve always worked as vocal advocates for minorities in the sector, lobbying for social equity every single time a new state legalizes cannabis. Lately, they’ve been doing consultations with some of the bigger companies in the industry — those who do absolutely nothing to help support communities most harmed by the laws that allow themselves to grab a slice of the billion-dollar cannabis pie. “We are transitioning into doing more inclusion support, diversity support, and marketing support for people that know that they need to have a more authentic relationship with Black, Indigenous, People of Color.”

Cannabis has been a huge part of Pryor’s life and work, here are five cannabis products that she can’t live without.

Congo Club’s Congolese Red pre-rolls

Congo Club is a Black-owned cannabis company founded by Amber Senter. It’s gotta be some fire, because I’ve had random people asking me where to find it way before Pryor even told me she loved their Congolese Red. 

Answer: you can get these at Sweet Flower dispensary, a Los Angeles-based chain of dispensaries with locations in the Arts District, Studio City, Westwood, and on Melrose. It is owned by another co-founder of Cannabis For Black Lives, and they feature a social equity shelf that makes it very easy for you to support minorities in this space. They’ve also donated $175,000 to organizations aimed at uplifting communities

exir pre-rolls

exir pre-rolls are a brand of pre-rolls from Cosmic Distribution’s catalog. They boast “ALL NUG. NO SHAKE.” Currently, they have three strains in five-count pre-roll packs: French Toast (sativa), Fruity Pebbles (hybrid), and Ancient OG (indica). Peep the full catalog here.

TONIC CBD’s Skincare Products

Founded by Brittany Carbone, Tonic CBD is the first woman-owned hemp vertical in New York State. “We have two amazing skincare products that actually work for people that are melanated, as well as other skin types,” said Pryor.

Those two products are Tonic’s Outer Space Renewal: Face + Body Oil and Outer Space Body Butter. Both are made with a combination of CBD and CBC, a minor cannabinoid that Tonic suggests is helpful for managing acne due to its anti-inflammatory qualities and ability to suppress excess lipid oil.

Cann Social Tonics

Cann is a microdosable brand of infused beverages that Pryor drinks on an everyday basis. CANN’s tonics are made with 2 milligrams of THC, 4 milligrams of CBD, and come in a wide variety of flavors, including Lemon Lavender, Blood Orange Cardamom, and Grapefruit Rosemary. Pryor’s favorite is Cranberry Sage, their seasonal flavor that drops around wintertime.

Additionally, CANN puts their money where their mouth is by prioritizing social justice. “The reason why I mess with CANN is that they support marginalized communities and marginalized efforts. And they do their best to educate their audience on more than just the fact that they’re a good product with a nice design and really really delicious.”

Black Dragon Breakfast Club Gift Box

Last, but certainly not least, Pryor can’t live without the Black Dragon Breakfast Club Gift Box. Woman-owned and founded by Tsehaitu Abye, Black Dragon Breakfast Club is a cannabis advocacy, consultation, and lifestyle brand that debuted an accessories shop in 2020. 

Currently sold out, their Essential Gift Box includes a laundry list of products including the Cannabis Is Medicine desk plate, a deck of cannabis affirmation cards, their full spectrum hemp bath salts, and many other lifestyle-focused products. 

Keep an eye on the Shop Black Dragons website for restock updates.

Photo courtesy of Mattio. Graphic by David Lozada/Weedmaps

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