This California Health Network Was Just Hacked for the Third Time

This California Health Network Was Just Hacked for the Third Time

What went wrong?

In today's media-heavy landscape, it doesn't take long for news to spread about data breaches. Once they become public knowledge, the potentially affected individuals scramble to protect themselves by enrolling in identity theft monitoring programs while the victimized companies fix their vulnerabilities.

A single data breach experienced by a company is damaging enough, but the Verity Health System of California and Verity Health Foundation, known collectively as Verity, suffered a third such issue. What went wrong?

Unauthorized Email Access

A press release from Verity about the most recent incidents confirms that in late November 2018 and mid-January 2019, an unauthorized third party accessed three of the company’s email accounts, including the attachments contained within the respective messages. Verity’s IT security team learned of those incidents hours after they occurred and immediately began assessing the scope of the issue. They disabled the affected email accounts and took them offline as a start. The company notified all relevant regulatory bodies, too.

A more in-depth investigation of the matter showed that the compromised email accounts contained health or medical information. Verity representatives said the content included details like names, billing codes, health insurance policy numbers, treatments given and medical conditions.

They also confirmed that some of the attachments in those email accounts had Social Security Numbers or driver’s license details. But, the results of Verity’s investigation at the time the company published its press release determined that the goal of those responsible was to get the login information of fellow users.

Like many recent data breaches before this one, the details about the incidents are not sufficient to give people peace of mind. For example, Verity stated that there was no evidence that this unknown and unauthorized party accessed or distributed the information held in those email accounts.

How Did the Company Respond?

Verity noted that its decision to notify potentially affected individuals came from “an abundance of caution.”

It offered a year of free credit monitoring to people who may have had their Social Security Numbers or driver’s license numbers accessed during the breach. The company set up a call center to field questions about these incidents, too.

Moreover, Verity launched an internal initiative to improve security. It includes mandatory password resets and disabling unknown URLs. Employees also had to go through a new training module after the incident.

Not the First Issues

The most recent issues reportedly involve phishing attempts. But, cybercriminals have also targeted the company in another way. In early January 2017, a hacker got into one of the company's websites. Even though Verity was not using that site at the time of the breach, it still contained data from more than 10,000 patients. In that case, the breach exposed partial credit card numbers.

Even more worrisome — the company left that website unsecured for more than a year before noticing the problem. As in the more recent cases, the company notified the appropriate authorities and took steps to stop future issues. But as the news headlines indicate, the actions taken were not sufficient.

Health Care Issues Cause Substantial Financial Burdens

In August 2018, Verity filed for bankruptcy and said the six hospitals in its network would stay open despite the development. It did not cite the January 2017 incident as a reason for the financial woes, but there's no question that problems like these have widespread effects for the health care industry at large and the organizations directly affected.

And, poor cybersecurity alone is not responsible for a health organization's expenses. A look at whistleblower lawsuits in 2018 shows that $2.5 billion of recoveries associated with the False Claims Act during that year related to health care fraud. So, fraud is another possible expense generator for health organizations, but how does it compare to data breach costs?

A 2018 report shows that health care has the highest cost per record, totaling $408 each. Then, a different report published by Protenus shows that between July and September 2018 alone, there were 4.4 million records breached during 117 incidents. The tremendous amount of loss in that brief period shows why it's crucial for health companies to take cybersecurity seriously.

Breaches Make Health Facilities Lose Business

The costs of health breaches go beyond the direct expenses incurred by cleaning up the aftermath of those incidents. Accenture published 2017 research about how health breaches impact consumers. Perhaps surprisingly considering the events above, 88 percent of those polled trusted health care professionals or facilities to keep their data safe.

But, when things went wrong, 91 percent of those polled showed proactive responses after breaches. A quarter of respondents said they changed health care providers after breaches. That finding emphasizes why Verity needs to view its cybersecurity struggles as top-priority problems to solve. If people haven't already decided not to continue using one of Verity's six hospitals, they may reach that conclusion soon.

Too Little, Too Late

Regardless of whether people were directly affected by the Verity breaches or only read about them in the headlines, they're undoubtedly left wondering how one company could have three breaches occur in a relatively short timespan.

Some will likely decide that whatever actions the company took fell short and that they cannot continue to trust Verity to safeguard its data. Three strikes spell trouble in baseball, and especially so when a company has three failures of its own that show it can't secure sensitive information.


  • 12 Commercial Crime Sites to Do Your Research

    12 Commercial Crime Sites to Do Your Research

    Understanding crime statistics in your industry and area is crucial for making important decisions about your security budget. With so much information out there, how can you know which statistics to trust? Read Now

  • Boosting Safety and Efficiency

    Boosting Safety and Efficiency

    In alignment with the state of Mississippi’s mission of “Empowering Mississippi citizens to stay connected and engaged with their government,” Salient's CompleteView VMS is being installed throughout more than 150 state boards, commissions and agencies in order to ensure safety for thousands of constituents who access state services daily. Read Now

  • Live From GSX: Post-Show Review

    Live From GSX: Post-Show Review

    This year’s Live From GSX program was a rousing success! Again, we’d like to thank our partners, and IPVideo, for working with us and letting us broadcast their solutions to the industry. You can follow our Live From GSX 2023 page to keep up with post-show developments and announcements. And if you’re interested in working with us in 2024, please don’t hesitate to ask about our Live From programs for ISC West in March or next year’s GSX. Read Now

    • Industry Events
    • GSX
  • People Say the Funniest Things

    People Say the Funniest Things

    By all accounts, GSX version 2023 was completely successful. Apparently, there were plenty of mix-ups with the airlines and getting aircraft from the East Coast into Big D. I am all ears when I am in a gathering of people. You never know when a nugget of information might flip out. Read Now

    • Industry Events
    • GSX

Featured Cybersecurity


New Products

  • FEP GameChanger

    FEP GameChanger

    Paige Datacom Solutions Introduces Important and Innovative Cabling Products GameChanger Cable, a proven and patented solution that significantly exceeds the reach of traditional category cable will now have a FEP/FEP construction. 3

  • Mobile Safe Shield

    Mobile Safe Shield

    SafeWood Designs, Inc., a manufacturer of patented bullet resistant products, is excited to announce the launch of the Mobile Safe Shield. The Mobile Safe Shield is a moveable bullet resistant shield that provides protection in the event of an assailant and supplies cover in the event of an active shooter. With a heavy-duty steel frame, quality castor wheels, and bullet resistant core, the Mobile Safe Shield is a perfect addition to any guard station, security desks, courthouses, police stations, schools, office spaces and more. The Mobile Safe Shield is incredibly customizable. Bullet resistant materials are available in UL 752 Levels 1 through 8 and include glass, white board, tack board, veneer, and plastic laminate. Flexibility in bullet resistant materials allows for the Mobile Safe Shield to blend more with current interior décor for a seamless design aesthetic. Optional custom paint colors are also available for the steel frame. 3

  • Luma x20

    Luma x20

    Snap One has announced its popular Luma x20 family of surveillance products now offers even greater security and privacy for home and business owners across the globe by giving them full control over integrators’ system access to view live and recorded video. According to Snap One Product Manager Derek Webb, the new “customer handoff” feature provides enhanced user control after initial installation, allowing the owners to have total privacy while also making it easy to reinstate integrator access when maintenance or assistance is required. This new feature is now available to all Luma x20 users globally. “The Luma x20 family of surveillance solutions provides excellent image and audio capture, and with the new customer handoff feature, it now offers absolute privacy for camera feeds and recordings,” Webb said. “With notifications and integrator access controlled through the powerful OvrC remote system management platform, it’s easy for integrators to give their clients full control of their footage and then to get temporary access from the client for any troubleshooting needs.” 3