6 Reasons Medical Professionals Need to Understand Cyber Liability
As a healthcare practitioner, you’ve likely heard of cyber liability. In short, this means you may be responsible for compensating patients and others who are victimized by a security breach or similar IT-related incident from your office. And if you’re thinking that as a counselor, therapist, or social worker the chances of such an event happening to you are slim, data collected in recent years suggests just the opposite.
6 Reasons Medical Professionals Need to Understand Cyber Liability
1. Data Breaches Grow Every Year
In 2020, every day, there was at least one data breach of 500 or more healthcare records reported. This equated to over 29 million records breached in total for the year. This is 29% higher than the hacks reported in 2019, and experts believe these numbers will steadily climb as cybercriminals continue to use more sophisticated techniques.
On average, each of these attacks is estimated to cost millions of dollars in forensic analysis, stolen funds, lost business, and fines. Without the right insurance policy in place, you will be forced to pay these expenses out of pocket. This could quickly end your practice and financially devastate you.
2. Cyber Attacks Can Put Patient Health Needs at Risk
Attacks are diverse in nature, taking on several different forms that each put the culprit in control. The worst known of these incidents are ransomware attacks. These hold sensitive data hostage until a demanded ransom is paid to the criminals. But this is only half of the bigger picture; when providers cannot access patient records, care becomes compromised.
Digital records have become the norm in healthcare, and they are both convenient and efficient. Unfortunately, they also make lucrative targets for savvy criminals. HIPAA provides stringent guidelines as to how these digital records must be maintained. Surveys, however, reveal most healthcare practices remain acutely unprepared for an outside attack. A lack of security puts patient health at risk, while a lack of insurance jeopardizes your practice.
3. Medical Practices Are Prime Targets for Cyber Crime
Cybercriminals are smart. They know healthcare providers have access to all kinds of patient information, including:
- Social Security numbers
- Insurance information
- Billing information
- Medical records
If you’re wondering what on earth can be done with this data, we’ll tell you. Compromised identities sell on the black market for a minimum of $50 each. Stolen credit card and banking information can be used to make fraudulent purchases. And patient records provide access to medications and medical equipment. Meanwhile, it costs a practice no less than $240 per identity to address the public, protect its image, and obtain legal assistance.
4. Providers Can Be Exposed in a Number Ways
Employee negligence is responsible for most data breaches. Simply by clicking an errant email or visiting an infected website, staff make it easy for cybercriminals to access private information. They may also dispose improperly of patient records or simply act irresponsibly because they’re disgruntled and/or feel something is owed to them. Additional ways your office may be vulnerable include:
- Outsourcing IT
- Increasing your use of electronic databases and cloud storage that maintain large volumes of information
- Neglecting to encrypt sensitive data
- Losing mobile devices or electronic files
5. Small Does Not Mean Safe
You might be reading this and thinking that because you have a small practice, no cybercriminal would ever notice you. This was true five years ago but no longer holds water. Smaller offices are in fact the most vulnerable because they’re focused on patient care rather than ensuring they have the latest security measures in place.
If you need more convincing, consider this: 83% of physicians reported experiencing a cyberattack of some kind in 2017. Not all resulted in breaches, but they were significant enough to impact operations. And among those victimized were a solo internist in Arizona, a solo primary care physician in Florida, and an 11-doctor practice in Tennessee. Size does not matter to hackers.
6. Healthcare Data Breaches Are Extremely Costly
The costs associated with handling a data breach are numerous. A study from the Ponemon Institute and IBM found healthcare data breaches are the most expensive to repair, costing an average of $6.5 million per incident per year. This is over 60% more than all other sectors. This doesn’t even factor in potential regulatory fines relating to HIPAA.
The study also found that advertising immediately following a breach must increase to help restore public trust. In the 12 months after a breach, you can expect to spend a whopping 64% more on public relations efforts. Such spending takes valuable resources away from those in greatest need – namely, patients – therefore affecting populations even outside the breach’s immediate reach.
Cyber Liability Insurance for Medical Providers
One of your best lines of defense when it comes to cyber threats is a comprehensive cyber liability insurance policy. NOW Insurance offers affordable plans for healthcare professionals and practitioners. In addition, we offer professional and general liability for all types of healthcare providers.
Get a cyber quick quote today. And we encourage all providers to take our online cyber risk assessment to determine your risk level for a cyber-attack.
Get a quote for professional and general liability in less than three minutes using our easy online application.
Contact us with any questions or for help securing coverage.
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