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Amid Leadership Changes at HHS, Former Deputy CISO Speaks Out on Cybersecurity Center Controversy

March 26, 2018
by Heather Landi
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Former HHS Deputy CISO Scanlon says the HCCIC, which played such a promising role during the WannaCry incident, has been "derailed"
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Over the past seven months, there have been a number of events that have upended top technology and cyber leadership at the U.S. Department of Health and Human Services (HHS), and some healthcare leaders are questioning the status of HHS’s cyber operations center, which launched just last June.

Now, there are reports that there will be a new HHS chief information security officer (CISO) to replace Chris Wlaschin, who is resigning from the role effective March 31.

According to reports from Federal News Radio, Janet Vogel, currently the deputy chief information officer at the Centers for Medicare & Medicare Services (CMS), will be replacing Wlaschin, who announced he was stepping down for personal reasons.

However, Wlaschin’s resignation, and the leadership changes in the agency’s top cyber position, come amid an almost seven-month-long controversy over HHS’ fledging cyber operations center and the ousting of the center’s top leaders last fall. The center’s director, Maggie Amato, has since resigned, and the former deputy CISO, Leo Scanlon, has been on involuntary leave for the past six months. In a letter provided by their attorney, Charles McCullough, III, both Scanlon and Amato contend that there was no legitimate basis for their reassignments, and that they were retaliated against as whistleblowers.

The Healthcare Cybersecurity Communications Integration Center (HCCIC), which went live at the end of June 2017, was established to protect the nation’s healthcare system from cyber attack. HCCIC focuses its efforts on analyzing and disseminating cyberthreats across the healthcare industry in real time. Wlaschin has been overseeing the cyber center in Amato and Scanlon’s absence. According to an interview with Nextgov, Wlaschin said his resignation was entirely for personal and family reasons, and unrelated to disputes over the HCCIC.


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When Healthcare Informatics contacted HHS regarding whether there was or had been an Office of the Inspector General (OIG) investigation into allegations against Scanlon and Amato or an investigation into reprisal complaints from Scanlon and Amato, an agency spokesperson responded via email, “At this time, I cannot confirm or deny OIG investigations into Scanlon or Amato, nor can I confirm or deny the existence or receipt of any whistleblower complaints.”

The controversy regarding top tech and cyber positions at HHS is a tangled web of personal and policy disputes, and, according to Scanlon in a published statement provided by his attorney, the net effect of the reassignments has been that “the HCCIC initiative, which played such an important and promising role during the WannaCry incident, has been derailed.” Further, Scanlon states that “the Critical Infrastructure Protection Program of HHS once again lacks a cybersecurity component, and the NH-ISAC [National Health Information Sharing and Analysis Center] has no functioning partners in the agency.”

Top Leaders Reassigned

According to multiple media reports back in November, the fledging HCCIC became the center of a rumored investigation into contracting irregularities and possible fraud allegations. An anonymous complaint was lodged, alleging contracting improprieties with regards to steering a no-bid contract to an individual with personal connections to Amato. Scanlon was put on administrative leave back in September, and Amato left the government. 

According to an article written by Politico’s Darius Tahir back in November, “An HHS official says the agency is investigating irregularities and possible fraud in contracts they signed. The two executives, Leo Scanlon and Maggie Amato, allege they were targeted by disgruntled government employees and private-sector companies worried the cyber center would take away some of their business.”

In his published statement provided through his attorney, Scanlon, who is still on administrative leave, wrote: “Over 200 days ago, Chris Wlaschin removed Maggie Amato and I from our positions as the leaders of the HHS HCCIC. He cut us off from colleagues, denied us access to HHS facilities, removed our security clearances, and told agency officials, the Congress and the media that this was a response to an ongoing investigation by the OIG into anonymous and unsubstantiated allegations directed against OCIO [office of the chief information officer] staff and leadership. These allegations were spread by HHS employees who sought to stop the HCCIC initiative. Wlaschin took his actions without recommendations from any investigative entity, and in fact, without any investigation being underway at all.”

In a March 12 letter to HHS Secretary Alex Azar, McCullough, a partner with Washington, D.C.-based Tully Rinckey, LLC, and who represents both Scanlon and Amato, wrote that he wanted to call Azar’s attention to “significant irregularities and possible violations of law" carried out by HHS in the treatment of these employees. According to McCullough’s letter, Scanlon and Amato were removed from their positions, without warning, on September 6 by Wlaschin and reassigned to “unclassified temporary duties.”

McCullough also wrote in the letter to Sec. Azar that Wlaschin “stated under oath that the allegations against Scanlon and Amato were being investigated by the HHS Office of Inspector General.”

On September 19, Scanlon and Amato reported these and numerous other agency-related improprieties to Congress, and gained whistleblower status. Scanlon and Amato, as stated in the letter, contend that they were then retaliated against. “Ms. Amato was thereafter subjected to a series of increasingly hostile and retaliatory acts which forced her resignation. On the day after Ms. Amato was driven out, Mr. Scanlon was placed on Administrative Leave with no explanation,” according to McCullough’s letter to Sec. Azar.

The 120-day limit on administrative leave ended Feb. 18, but, as of March 12, Scanlon was still on paid administrative leave. According to McCullough’s letter, Scanlon and Amato were recently made aware that the HHS OIG was not, nor ever had been, investigating them.

In his public statement, Scanlon wrote: “In an interview with OIG investigators, in February, my attorney and I were told that neither Amato nor I were under investigation or had ever been under investigation with regard to the allegations Wlaschin presented to them. Yet, in sworn depositions, Wlaschin stated that the personnel actions taken against Amato and me were based on an 'OIG investigation.' The investigators explained that as with any federal investigative entity, all complaints received by the OIG are reviewed, but a review is not an investigation. Wlaschin has admitted that he was never contacted by OIG or ethics officials after submitting his complaints. The claims of an OIG investigation were and are reckless misrepresentations.”

Meanwhile, the House Energy and Commerce committee also is reviewing the situation. In a letter dated Nov. 14 to then Acting HHS Secretary Eric Hargan, House E&C committee chairman and ranking members wrote that the committee is examining whether HHS retaliated against two key HHS cybersecurity officials for communicating with the committee “as well as whether recent actions by the department potentially weaken the HHS role in responding, or assisting stakeholder response, to cybersecurity incidents affecting the healthcare sector.”

Scanlon and Amato are requesting an in-person meeting with Secretary Azar to resolve the situation, McCullough wrote. The letter from McCullough also suggests resolution through other means, such as Congressional committees, the Equal Employment Opportunity (EEO) Commission and the Office of Special Counsel.

It’s been reported that HHS’s inspector general has interviewed Scanlon and Amato as part of their reprisal complaint. “It is our understanding that they take whistleblower reprisal very seriously, and that they are actively looking into the allegations of retaliation made by Mr. Scanlon and Ms. Amato,” McCullough, Scanlon and Amato’s attorney, said in a statement. “We fully expect the truth to come out soon.”

Status of HHS Cybersecurity Center?

Controversy about the HCCIC goes back to the center’s inception. According to many media reports, including an article by Nextgov, some industry officials and lawmakers believe that the HCCIC duplicates the work already being done by the Department of Homeland Security and the healthcare industry.

According to Scanlon and other healthcare officials, the reassignments have put the HCCIC’s work on hold, and at a time when the healthcare industry is facing evolving, persistent cyber threats.

During a House Energy and Commerce Oversight subcommittee hearing back in June, Scanlon touted the HCCIC's success in light of the WannaCry ransomware attack in March 2017. While the malware attack severely impacted the National Health Service in the UK, WannCry’s effect was ultimately minimal in the U.S. Scanlon reported that HCCIC played an integral role in HHS’ coordinated response to the WannaCry incident as HCCIC analysts provided early warning about the impact to health care. Scanlon testified that during the WannaCry attack and throughout the following days HHS took a central role in coordinating government resources, compiling and distributing relevant information, and generally serving as a hub for both public-and private-sector response efforts.

Top lawmakers on the House Energy and Commerce committee also voiced concerns about how the abrupt changes that took place back in September would impact the HCCIC. In the letter to Acting HHS Secretary Hargan, they wrote, “Given how critical health care cybersecurity is to the nation and the apparently central role of the new HCCIC in the Department’s response to WannaCry, these recent and abrupt changes raise a number of questions about HHS and its commitment to providing effective leadership to the sector. HHS’s apparent inability to provide stability and clarity about internal roles and responsibilities for cybersecurity risks is undermining any recent progress made by the department in developing the trust and confidence within the health care sector necessary to provide leadership on this important topic.”

There are rumors that HHS’s cyber information-sharing center, the HCCIC, will be rebranded and will be housed within Homeland Security in order to align with DHS’s information-sharing efforts. Speaking during a phone interview, Scanlon contends that the effort to create a healthcare-specific cybersecurity information-sharing center is now "back to square one.”

“It’s a tremendous risk to the healthcare industry. The purpose of HCCIC was to set up and establish the kinds of collaborative communication channels that were demonstrated in WannaCry. And, absent a robust relationship between ASPR [the HHS Office of Assistant Secretary for Preparedness and Response] and the NH-ISAC with the healthcare sector, the ability of HHS to leverage it’s very real, very robust emergency response capabilities in a cyber-related incident is diminished. With the WannaCry attack, the reason the sector was well-served was that the agency was finally prepared to do what it’s supposed to be doing as a sector-specific agency. It’s not prepared to do that as this point. In practical, operational terms, it’s back to square one.”

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Targeting Third Party Risk: Leading CISOs Detail Efforts to Secure the Healthcare Supply Chain

December 18, 2018
by Heather Landi, Associate Editor
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Healthcare information security leaders are faced with the dauting challenge of securing information systems and data at a time when the cyber threat landscape is evolving rapidly and becomingly increasingly complex.

Most patient care organizations’ supply chains are filled with third parties who support the care delivery process and require access to patient information. Properly vetting and monitoring these third parties is a major challenge, and in some cases, insurmountable for many organizations who simply don’t have the expertise or resources, according to healthcare IT security leaders.

Many healthcare chief information security officers (CISOs) have found that effectively assessing the security posture up and down the supply chain is expensive given the complexity of the risks posed by privacy and security concerns, as well as an everchanging regulatory landscape. Currently, the process of managing third-party risk is often inefficient and time-consuming, for both vendors and providers, while still leaving organizations vulnerable to security threats.

During a recent webinar, sponsored by HITRUST, focused on healthcare cybersecurity and managing third party risk, John Houston, vice president, privacy and information security at the 40-hospital UPMC health system in Pittsburgh, outlined a number of factors that have made third-party risk management increasingly challenging and complex.

“There has been a fundamental change in IT, and a rapid move to the cloud. At the same time, we all see an increasingly complex cyber threat landscape where the threats are more sophisticated, and the technology solutions are more sophisticated as our business requirements are changing. It’s an increasingly complex landscape,” Houston said.


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He further noted, “As a result, there is a lot of confusion about how we best ensure our information is secure and available, and what is reasonable in terms of trying to achieve that. And finally, we are all worried about risk, and the biggest risk is patient safety. We worry about the cost of litigation and penalties, but first and foremost, we need to think about ensuring that we are able to deliver the best care to our patients.”

The stakes are changing, Houston noted, as federal regulators are investigating and penalizing organizations for failure to monitor third parties’ security practices, and hackers are increasingly targeting medical devices, he said.

“From a CISO perspective, we need to ensure that we are applying proper oversight over all of this. We can’t assume third parties are doing the right thing,” he said.

What’s more, healthcare organizations are increasingly reliant on cloud technology. A year ago, Nuance Communications, a provider of voice and language tools, was knocked offline when the company was hit with the Petya ransomware virus.

“I was around during Y2K, and about 95 percent of all our applications at UPMC, we ran within the data center, on premise. About 95 percent of newly acquired applications were run on on-premise, there was little on the cloud. In that environment, it falls upon the entity to secure data within its possession,” he said.

Contrast that with today’s environment, as Houston noted that “very little of what we acquire today runs on-premise. In some way, shape or form, at least one copy of the data is in the cloud.”

Studies have estimated that by 2023 no more than 25 percent of applications will be run on-premise in an organization’s data center, with about 75 percent run in the cloud, Houston said. “Many copies of our data end up in the cloud, and it’s not just one cloud provider. We get services from a lot of different vendors, all of which are in the cloud. That speaks to the fact we, as CISOs, can no longer directly secure our own information. We are dependent upon third parties to secure our data for us. We can’t simply trust that they are going to adequately secure that information.”

From a healthcare CISO’s perspective, a vendor’s IT and data security practices should be at least as effective as the provider’s security posture, Houston said. “I should expect nothing less. As soon as I expect less, that’s a sign of defeat.”

Across the healthcare industry, ineffective security, compliance and assurance methods drive cost and confusion within organizations and across third parties, according to IT leaders.

While most healthcare organizations are taking the right steps to monitor and screen vendors and their products and services during the pre-selection and on-boarding phases and are also conducting security risk assessments, it’s still not enough to protect IT systems, data, and, most importantly, patients, said Taylor Lehmann, CISO at Wellforce, the Burlington, Mass.-based health system that includes Tufts Medical Center and Floating Hospital for Children. “We are still seeing breaches, and the breaches are still coming after we do all this screening,” he said.

“We’re not being effective and it’s difficult to be effective with the current paradigm,” Houston added.

From the CISO’s perspective, there are inefficiencies in the third-party supply chain ecosystem. Suppliers are commonly required by their customers to respond to unique questionnaires or other assessment requests relating to their risk management posture. Vendors often must fill out questionnaires with 300-plus questions. What’s more, there’s no assurance or audit of the information the vendor provides, and the process is completely inefficient for suppliers who are audited 100 times annually on the same topics, but just different questions, Lehmann and Houston noted. What's more, the security assessment often occurs too late in the process.

“We’re creating a lot of waste; we’re taking time away from our organizations and we’re taking time away from suppliers,” Lehmann said. “The current way we’re doing supply chain risk management, it doesn’t work, and it doesn’t scale, and there is an opportunity to improve.”

To address these issues, a group of CISOs from a number of healthcare organizations established the Provider Third Party Risk Management (TPRM) Initiative to develop a standardized method to assess the risk management posture of third-party suppliers to healthcare firms. Launched this past August, the founding member organizations for the Provider TPRM Council include Allegheny Health Network, Cleveland Clinic, University of Rochester Medical Center, UPMC, Vanderbilt University Medical Center and Wellforce/Tufts University. Working with HITRUST and PwC, the Council aims to bring uniformity and consistency to the process while also reducing the burden on providers and third parties.

The healthcare industry, as a whole, will benefit from a common set of information security requirements with a standardized assessment and reporting process, Lehmann noted.

In the past four months, the governing members have been expanded to include Nuance, The Mayo Clinic, Multicare, Indiana University Health, Children’s Health Dallas, Phoenix Children’s Hospital, and Banner Health.

The Provider TPRM initiative is increasing membership and gaining momentum as security leaders from both healthcare providers and their suppliers embrace the unified approach, Lehmann said.

One of the goals for the Council is to address the inefficiencies found in the third-party supply chain ecosystem. By reducing the multiple audits and questionnaires, the financial savings will allow business partners to invest in substantive risk reduction efforts and not redundant assessments, the Council leaders say.

“By reducing wasted effort and duplication, suppliers will find their products and services will be acquired more quickly by healthcare providers. This will also reduce the complexity of contracts and provide third parties with better visibility regarding the requirements to do business with providers,” said Omar Khawaja, VP and CISO of Allegheny Health Network and Highmark Health. Khawaja’s organization is a founding participant and governing member of the Provider TPRM initiative.

As part of this initiative, going forward, provider organizations that join the effort will require third-party vendors to become HITRUST CSF Certified within the next two years, by September 2020. The HITRUST CSF Certification will serve as the standard for third parties providing services where they require access to patient or sensitive information and be accepted by all the Council’s organizations. HITRUST CSF is an industry privacy and security framework that is continuously evolving with the changing cyber landscape.

 “After September 1, 2020, third parties without certification cannot do business with participants,” Khawaja said.

Houston added, “We recognize that there are limitations in our current processes, and what we’re putting in place is at least as good or better than what we’re already doing. This will lead to faster onboarding, less waste, better transparency, and simpler compliance.”

By choosing to adopt a single comprehensive assessment and certification program, healthcare organizations represented by the council are prioritizing the safety, care, and privacy of their patients by providing clarity and adopting best practices that their vendors can also adopt, while providing vendors the expectation of what it takes to do business with their organizations.

“It provides transparency,” Houston said “It sends a message to suppliers that we’re an open book about what it takes to do business. That’s powerful.”

Moving forward, the Provider TPRM initiative will focus on adding business associates to the effort to increase membership and impact, Lehmann said. “The simple fact is, many of us are pushing this through our supply chain and there are organizations that may not have a process or low maturity process. But, through the efforts of council members, more suppliers will show up, which is means safer products are possible to purchase.”

Further, the program will likely develop additional requirements on vendors such as breach response and monitoring security threats and alerts observed as third-party vendors.

The Council also plans to focus on certification programs for smaller vendors. “A lot of innovation in healthcare is coming from smaller companies, and we understand there is a gap between what those companies can do with respect to cyber. We’re not lowering our standards, but we want to be thoughtful and create a certification program for those areas. We want to do business and we need a vehicle to bring them in in a safe and secure way,” Lehmann said.

“We want to build a community of health providers working together, business associates working together, to share information,” Lehmann said. “We want to better inform ourselves and align other programs, like cyber insurance, to enable more effective planning throughout the supply chain. The things we learn through these relationships can translate to other aspects of our organizations.”

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Florida Provider Pays $500K to Settle Potential HIPAA Violations

December 12, 2018
by Heather Landi, Associate Editor
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Florida-based Advanced Care Hospitalists PL (ACH) has agreed to pay $500,000 to the Office for Civil Rights (OCR) of the U.S. Department of Health and Human Services (HHS) to settle potential HIPAA compliance failures, including sharing protected health information with an unknown vendor without a business associate agreement.

ACH provides contracted internal medicine physicians to hospitals and nursing homes in west central Florida. ACH provided services to more than 20,000 patients annually and employed between 39 and 46 individuals during the relevant timeframe, according to OCR officials.

Between November 2011 and June 2012, ACH engaged the services of an individual that claimed to be a representative of a company named Doctor’s First Choice Billings, Inc. (First Choice). The individual provided medical billing services to ACH using First Choice’s name and website, but allegedly without the knowledge or permission of First Choice’s owner, according to OCR officials in a press release published last week.

A local hospital contacted ACH on February 11, 2014 and notified the organization that patient information was viewable on the First Choice website, including names, dates of birth and social security numbers. In response, ACH was able to identify at least 400 affected individuals and asked First Choice to remove the protected health information from its website. ACH filed a breach notification report with OCR on April 11, 2014, stating that 400 individuals were affected; however, after further investigation, ACH filed a supplemental breach report stating that an additional 8,855 patients could have been affected.

According to OCR’s investigation, ACH never entered into a business associate agreement with the individual providing medical billing services to ACH, as required by the Health Insurance Portability and Accountability Act (HIPAA) Privacy and Security Rules, and failed to adopt any policy requiring business associate agreements until April 2014. 

“Although ACH had been in operation since 2005, it had not conducted a risk analysis or implemented security measures or any other written HIPAA policies or procedures before 2014. The HIPAA Rules require entities to perform an accurate and thorough assessment of the potential risks and vulnerabilities to the confidentiality, integrity, and availability of an entity’s electronic protected health information,” OCR officials stated in a press release.

In a statement, OCR Director Roger Severino said, “This case is especially troubling because the practice allowed the names and social security numbers of thousands of its patients to be exposed on the internet after it failed to follow basic security requirements under HIPAA.”

In addition to the monetary settlement, ACH will undertake a robust corrective action plan that includes the adoption of business associate agreements, a complete enterprise-wide risk analysis, and comprehensive policies and procedures to comply with the HIPAA Rules. 

In a separate case announced this week, a Colorado-based hospital, Pagosa Springs Medical Center, will pay OCR $111,400 to settle potential HIPAA violations after the hospital failed to terminate a former employee’s access to electronic protected health information (PHI).

Pagosa Springs Medical Center (PSMC) is a critical access hospital, that at the time of OCR’s investigation, provided more than 17,000 hospital and clinic visits annually and employs more than 175 individuals.

The settlement resolves a complaint alleging that a former PSMC employee continued to have remote access to PSMC’s web-based scheduling calendar, which contained patients’ electronic protected health information (ePHI), after separation of employment, according to OCR.

OCR’s investigation revealed that PSMC impermissibly disclosed the ePHI of 557 individuals to its former employee and to the web-based scheduling calendar vendor without a HIPAA required business associate agreement in place. 

The hospital also agreed to adopt a substantial corrective action plan as part of the settlement, and, as part of that plan, PSMC has agreed to update its security management and business associate agreement, policies and procedures, and train its workforce members regarding the same.

“It’s common sense that former employees should immediately lose access to protected patient information upon their separation from employment,” Severino said in a statement. “This case underscores the need for covered entities to always be aware of who has access to their ePHI and who doesn’t.”

Covered entities that do not have or follow procedures to terminate information access privileges upon employee separation risk a HIPAA enforcement action. Covered entities must also evaluate relationships with vendors to ensure that business associate agreements are in place with all business associates before disclosing protected health information. 


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Eye Center in California Switches EHR Vendor Following Ransomware Incident

December 11, 2018
by Rajiv Leventhal, Managing Editor
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Redwood Eye Center, an ophthalmology practice in Vallejo, Calif., has notified more than 16,000 patients that its EHR (electronic health record) hosting vendor experienced a ransomware attack in September.

In the notification to the impacted patients, the center’s officials explained that the third-party vendor that hosts and stores Redwood’s electronic patient records, Illinois-based IT Lighthouse, experienced a data security incident which affected records pertaining to Redwood patients. Officials also said that IT Lighthouse hired a computer forensics company to help them after the ransomware attack, and Redwood worked with the vendor to restore access to our patient information.

Redwood’s investigation determined that the incident may have involved patient information, including patient names, addresses, dates of birth, health insurance information, and medical treatment information.

Notably, Redwood will be changing its EMR hosting vendor, according to its officials. Per the notice, “Redwood has taken affirmative steps to prevent a similar situation from arising in the future. These steps include changing medical records hosting vendors and enhancing the security of patient information.”

Ransomware attacks in the healthcare sector continue to be a problem, but at the same time, they have diminished substantially compared to the same time period last year, as cyber attackers move on to more profitable activities, such as cryptojacking, according to a recent report from cybersecurity firm Cryptonite.

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