A couple of years ago, a reporter doing a story on landfills in Massachusetts stumbled on non-shredded PHI just sitting in the open in the landfill. He reported the information to authorities, which led to the investigation of four pathology practices and a billing company. Now, there has been a settlement related to this breach.
From http://www.healthcareinfosecurity.com/state-settles-hipaa-case-for-140000-a-5411
In 2010, the four pathology groups quickly worked to cooperate with the investigation, which ultimately showed that the billing company used by all four practices had improperly disposed of the records by sending them to a landfill without shredding or otherwise destroying the records. The Attorney General in Massachusetts completed its investigation and found the situation worthy of fines. After some negotiation, the practices and the now-defunct billing company agreed to a fine of $140,000.
OCR has issued express guidance on the proper disposal of paper-based PHI, particularly with regard to landfills. Be sure to read that info before entering into any agreements with any billing companies or waste disposal companies and require that those contractors follow the OCR-approved procedures.