Data Breaches Cost Hospitals $6 Billion Annually, According To Study

The latest study by Ponemon Institute, sponsored by ID Experts, finds that data breaches of patient information cost healthcare organizations nearly $6 billion annually, and that many breaches go undetected. 

The research indicates that protecting patient data is a low priority for hospitals and that organizations have little confidence in their ability to secure patient records, putting individuals at great risk for medical identity theft, financial theft and embarrassment of exposure of private information.

The passage of the HITECH Act in 2009 widened the scope of privacy and security protections under HIPAA to provide stronger safeguards for patient data.  This includes notification to patients when their information is breached.

"Our research shows that the healthcare industry is struggling to protect sensitive medical information, putting patients at risk of medical identity fraud and costing hospitals and other healthcare services companies millions in annual breach-related costs," said Dr. Larry Ponemon, chairman and founder, Ponemon Institute.  "At this point one would hope to see that healthcare organizations have improved information security practices and come into compliance with HITECH, now that it's been more than one year since it was enacted.  Instead we found enormous vulnerabilities.  The protection of patient data should be at the forefront of their efforts."

Key findings of the research:

  • Data breaches are costing the healthcare system billions.  The total economic burden created by data breaches on the healthcare industry is nearly $6 billion annually.  The impact of a data breach over a two-year period is approximately $2 million per organization and the lifetime value of a lost patient is $107,580.  The average organization had 2.4 data breach incidents over the past two years.  Major factors causing data breaches are unintentional employee action, lost or stolen computing devices and third-party error.
  • Healthcare organizations are not protecting patient data.  Organizations have little or no confidence in their ability to appropriately secure patient records (58 percent).  Healthcare organizations have inadequate resources (71 percent) and insufficient policies and procedures in place (69 percent) to prevent and quickly detect patient data loss.
  • Protecting patient data is not a priority.  Seventy percent of hospitals stated that protecting patient data is not a top priority.  Patient billing (35 percent) and medical records (26 percent) are the most susceptible to data loss or theft.  A majority of organizations have less than two staff dedicated to data protection management (67 percent).
  • HITECH has exposed the healthcare industry's lax data protection practices rather than improved the safety of patient records.  The majority (71 percent) of respondents do not believe the HITECH Act regulations have significantly changed the management practices of patient records.  The findings indicate that there is a significant number of data breaches that go undetected, and therefore unreported.

"We talk with healthcare compliance people dealing with data breach risks every day and they just can't get their arms around the problem of data exposure," said Rick Kam, president and co-founder of ID Experts.  "Unfortunately, in healthcare organizations, patient revenue trumps risk management."

The entire study can be found at http://www2.idexpertscorp.com/ponemonstudy.

Featured

  • Maximizing Your Security Budget This Year

    7 Ways You Can Secure a High-Traffic Commercial Security Gate  

    Your commercial security gate is one of your most powerful tools to keep thieves off your property. Without a security gate, your commercial perimeter security plan is all for nothing. Read Now

  • Survey: Only 13 Percent of Research Institutions Are Prepared for AI

    A new survey commissioned by SHI International and Dell Technologies underscores the transformative potential of artificial intelligence (AI) while exposing significant gaps in preparedness at many research institutions. Read Now

  • Survey: 70 Percent of Organizations Have Established Dedicated SaaS Security Teams

    Seventy percent of organizations have prioritized investment in SaaS security, establishing dedicated SaaS security teams, despite economic uncertainty and workforce reductions. This was a key finding in the fourth Annual SaaS Security Survey Report: 2025 CISO Plans and Priorities released today by the Cloud Security Alliance (CSA), the world’s leading organization dedicated to defining standards, certifications, and best practices to help ensure a secure cloud computing environment. Read Now

  • Mobile Applications Are Empowering Security Personnel

    From real-time surveillance and access control management to remote monitoring and communications, a new generation of mobile applications is empowering security personnel to protect people and places. Mobile applications for physical security systems are emerging as indispensable tools to enhance safety. They also offer many features that are reshaping how modern security professionals approach their work. Read Now

Featured Cybersecurity

Webinars

New Products

  • 4K Video Decoder

    3xLOGIC’s VH-DECODER-4K is perfect for use in organizations of all sizes in diverse vertical sectors such as retail, leisure and hospitality, education and commercial premises. 3

  • ResponderLink

    ResponderLink

    Shooter Detection Systems (SDS), an Alarm.com company and a global leader in gunshot detection solutions, has introduced ResponderLink, a groundbreaking new 911 notification service for gunshot events. ResponderLink completes the circle from detection to 911 notification to first responder awareness, giving law enforcement enhanced situational intelligence they urgently need to save lives. Integrating SDS’s proven gunshot detection system with Noonlight’s SendPolice platform, ResponderLink is the first solution to automatically deliver real-time gunshot detection data to 911 call centers and first responders. When shots are detected, the 911 dispatching center, also known as the Public Safety Answering Point or PSAP, is contacted based on the gunfire location, enabling faster initiation of life-saving emergency protocols. 3

  • Camden CV-7600 High Security Card Readers

    Camden CV-7600 High Security Card Readers

    Camden Door Controls has relaunched its CV-7600 card readers in response to growing market demand for a more secure alternative to standard proximity credentials that can be easily cloned. CV-7600 readers support MIFARE DESFire EV1 & EV2 encryption technology credentials, making them virtually clone-proof and highly secure. 3