The health sector ranks high among the most attractive targets for cyberattacks and data breaches, resulting in huge financial losses for healthcare organizations. It is estimated that 60% of security breaches are related to third parties, averaging $4.4 million in damages. IBM reported the average cost of a healthcare data breach increased to an all-time high of $10.1 million in 2022. The majority of those breaches were hacking incidents, many of which involved ransomware or attempted extortion.
The hacking of valuable data creates immense risk as threat actors can use it to wreak havoc on the healthcare provider’s business and threaten the lives of the involved patients. At the same time, third parties create, handle and store this data, creating an even larger threat surface for companies in the health sector and their data security. One of the more recent breaches was on March 12th, 2023, when hackers breached pharmacy services provider, PharMerica, stealing the full names, addresses, dates of birth, social security numbers (SSNs), medications, and health insurance information of 5,815,591 people.
Part 1 of our series “Building a Robust Third-Party Risk Management Program (TPRM) for Healthcare Organizations” reviewed the risk of cyber threats from third-party vendors, the importance of assessments, and how continuous monitoring plays a key role in preventing cyberattacks. In part 2 we will dive into the core components of an effective third-party risk management (TPRM) program.
Basics of Third-Party Risk Management in Healthcare
Nothing is truly “basic” when it comes to vendor risk management. This is one of the most complex and intricate cybersecurity approaches any organization can leverage. Furthermore, it’s also among the most crucial.
Third-party risk management refers to a suite of cybersecurity structures and practices that identify and mitigate the numerous threats that vendors may pass to your organization. Third parties include vendors, suppliers, contractors, and clients.
A practical TPRM strategy takes care of potential and existing security vulnerabilities resulting from these parties accessing your networks and customers’ assets. Thus, you can be sure that your patients’ financial information, protected health information, and personally identifiable information are safe.
Why is Vendor Risk Management so Important?
Of course, vendor risk is nothing new. A disappointing supplier can interrupt a manufacturing line; security providers can forget to lock the doors—what has changed is the depth and breadth of third-party relationships.
Outsourcing is now beyond such essential services to include vital business functions. Software tools that once ran on hospital-owned infrastructures are now part of x-as-a-service models. Moreover, customers, suppliers, and vendors directly access corporate networks. Combined, the developments expand your attack surface and expose you to cybersecurity, financial, and legal adversities.
By including these parties in your IT infrastructure, you share their security vulnerabilities. Even if they can’t access your data, any breach on their side could jeopardize your systems and data.
A robust TPRM program can offer visibility into your partners’ security practices so you can develop adequate cybersecurity controls. It also helps you create proactive measures against financial risks and shields you from civil litigation caused by poor data handling. Essentially, you’ll have the proper controls and contingencies you need to secure your valuable patient data.
Best Practices for Building an Effective Third-Party Risk Management Program
Consider these vital tips for building a robust TPRM program:
- Use board-level oversight and support to set the pace – Senior management staff should create a collaborative and transparent culture within the vendor ecosystem as they identify and mitigate the possible risks.
- Comprehensive security audits are a must – Security audits must be conducted at least yearly using an automated technology platform.
- True continuous monitoring and attack surface management between audits – Since your third-party risk management program goes beyond the supply chain’s first level, you’ll need technology to strengthen threat monitoring ensuring your assets are always protected.
- Verified combination of auditing and monitoring – Ideally the audit process should be fully integrated with attack surface monitoring to not just trust that everything is fine but also verify.
- Instant communication of issues – Actionable intelligence to resolve any areas of elevated risks should be communicated instantly to both the healthcare enterprise and its vendors, having a communication plan will ease tension during high-stress situations.
- Don’t forget fourth parties – Determine whether your suppliers provide the services or products or they’re subcontracting. The key is to bind vendors to seek approvals for fourth-party involvement.
It’s Time to Beef Up Your Vendor Risk Management
You cannot afford to lag when it comes to third-party risks, especially if you’re in the healthcare sector or have business relationships with companies in this vital industry. But while the above insights and tips can keep you ahead of third-party cybersecurity risks, establishing a robust TPRM program isn’t as cut and dried.
Fortunately, ProcessBolt AI can make your work easier and allow you to maximize your core business. ProcessBolt AI automates the vendor risks assessment process by extracting intelligence directly from policy documents. The platform greatly accelerates the assessment process and certifies and correlates the results without the need to rely on attestations. Our innovative solution continuously monitors all internet attack surfaces in true real-time, alerting your organization of any threatening changes in security posture.
Request a Demo
Complete this form to receive a personalized walk-through of ProcessBolt and learn how it can enhance your organization’s third-party risk management program.
