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I'm not disagreeing with you, but the fax loophole does need to be closed.
You're right to point out the problem. Using a rhetorical tone was a bit sarcastic / condescending, so I mirrored it.
I think it's a question of perspective. Your doctor faxing something to a pharmacy or specialist is archaic at this point, and I agree it's not great. If they are using FOIP and not POTS, one would hope it's encrypted with TLS or something (if it's not, it's possibly a HIPAA violation if there's PHI in the FAX). But the blast radius is pretty small.
I suppose if a hacker compromised a hospital system's FOIP they could harvest a lot of medical records that way. But at that point, they are already in and they'd likely be more interested in fatter & juicier targets on the network. Bigger datasets with less effort (versus pulling from a trickle of FAXes going in and out).
Bottom line: yes, FAX is dumb, and it's a problem but it's very small compared to other things.
Point of fact, I'm not bobs_monkey, the originator of the rhetorical tone. Fax in healthcare continues to survive well past its prime because there is an inherent loophole: analog data transfer is functionally unsuited to encryption. This allows fax to be operated at a "best effort" level of security. There are handling protocols that are meant to keep traditional fax transmissions as private as possible, but these are layer 8 processes with limited enforceability. Beyond that, traditional fax represents a pathway around requirements on encryption while still meeting HIPAA compliance standards.
FOIP is an improvement, but it still allows for interoperability with a traditional fax machine connected to a POTS line in some GP's office that they're unwilling to part with. That means the FOIP user can only be confident of the transmission being secure on their side. I can't speak to the overall adaptation of FOIP in hospital systems, but I do know that there are non-isolated instances of hospitals still relying on traditional fax as opposed to adopting a cloud-fax solution. Hell, there are still major hospitals using SL-100s as their primary phone switches.
I don't even want to get into codec mismatches, because that falls out of scope when it comes to a privacy discussion.
Long story short, achieving HIPAA compliance is a low bar with regards to fax, and if that were to change I believe we'd see fax disappear (finally!) shortly thereafter.