3-Steps to Review Your Vendor’s Information Security

With the New Year comes the resolve to do things for ourselves to make our lives better.  With that in mind, you should take the occasion to revisit your vendor management, particularly where information security is concerned.

The American Recovery and Reinvestment Act of 2009 required that all business associates (i.e. vendors) must comply with the privacy and security provisions of HIPAA as the covered entities they work with, and that these requirements must be included in your contracts.  While putting some language in contracts may satisfy legal minds, providing your business associates with specific guidance for compliance can eliminate confusion and demonstrate due diligence above and beyond.  Below are three key steps that can be the foundation of sound vendor management.

A good first step is to perform a risk analysis on your vendor relationship.  While there are many approaches to a risk assessment, find one that works for you and stick with it.  The value of a risk assessment comes in the consistent use of method or tool so you can make apples to apples comparisons.  If this is new to your organization, reach out to experienced professionals who can help, a little or a lot, to develop an approach that works for you.

Next, with a risk assessment in hand, look at the business associates with the most risk, and analyze if the current information security regimen is sufficient to reduce risks to an acceptable level.  Some questions you might consider:

  1. What transparency do you have into the operations and information security of your vendor?
  2. Are your vendors independently certified or audited?
  3. How responsive are my vendors when I send questionnaires or requests for attestation?

Consider requiring vendors to obtain independent certification in the next 18-24 months.  Among the many standards available, ISO 27001, HITRUST, and NIST are widely accepted.  The advantages to using a standard certification is the uniformity in controls selection, independent audit and assessment approach, and the reduction in compliance costs.

Third, be a promoter of the value of risk-based, objective vendor management.  The value of this approach is that is helps prioritize where your attention needs to be, and provides a clear measurement of just how important some of your business associations truly are.  This information can be shared throughout your organization, and can be integrated with other risk management, information security, and business intelligence activities.

As more business practices become outsourced, the need for sound vender management practices has never been greater.  Integrating your information security risk management approach with vendor management provides supply chain transparency and produces demonstrable due diligence.  Finally, by taking the above approaches, inconsistencies and short-comings are more likely to be identified and remedied before an embarrassing reportable event occurs.

What is Information Security?

Simply put, information security is about protecting information.  In the medical field, there are numerous types of information that need protection whether you are in the clinical environment, or behind the scenes.  Regardless what your position may be, 2016 is the year that information security is going to be bigger than ever.  And there are two reasons why.

The first reason has to do with HIPAA, a law passed in 1996.  Anyone who works around healthcare has heard of HIPAA, but few understand what is really in the law.  There are two parts to it, a Privacy Rule (which covers patient privacy) and a Security Rule (which covers electronic health records), but few have paid much attention to it, because unless something comes up in the news nobody was likely to feel the sting if either rule was broken.  However, starting in 2009, that started to change.  When President Obama signed the American Recovery and Rehabilitation Act (the large economic stimulus plan) into law, it contained provisions that gave HIPAA some teeth and those teeth have bite.  Consider these examples:

These are just some enforcement examples from 2015.  Look for more in this year.

There are worse things than a government penalty, and this is the second reason why information security will be important for all of us in 2016.  One year ago this month, one of the largest health insurers in California announced they were the target of a data breach, and approximately 80 million people were affected.  In July, a well-known university medical center announced they had been breached, affecting 4.5 million people.  According to one report, the first half of 2015 saw more than 89 million patient and staff records hacked nationwide, up from 12 million for the same time in 2014.  At an average cost of $154 per patient record to fix the mess caused by data breaches, this amounts to over $13.7 billion in damages caused to hospitals, insurers, HMOs, and others in just six months.

HIPAA is just one of the best known information security requirements, but there are other regulations, industry standards, and laws that apply to the areas covered by information security.  This is because the credit card industry has requirements for payment collection, the federal government has requirements for anything affecting collections and credit, and many states have their own unique requirements.  Any or all of these requirements may overlap anywhere where there is information that needs protection: frontline/patient admit, revenue recovery, billing, patient records, and human resources.  No matter where in a healthcare you work, you have a role to play.

There are reasons with technical sounding names for why hackers are able to wreck such havoc, but the bottom line is there are no signs they are going to stop trying.  So for this reason, 2016 will be a very important year for everyone to pay attention to information security.