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Healthcare’s “RegTech” Opportunity: Avoiding a 2008-Style Crisis

September 21, 2018
by Robert Lord, Industry Voice, Co-Founder and President of Protenus
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In the financial crisis of 2007 to 2009, the financial industry suffered a crisis of trust. A decade later, banks and other financial institutions are still working to regain the confidence of consumers and regulators alike. In 2008 and 2009, while working at one of the world’s top hedge funds, I had a front-row seat to the damage that occurred to our economy, watching as storied corporate institutions fell or were gravely damaged. Today, as co-founder of a health technology company, I see healthcare is approaching a similarly dangerous situation. We must get ahead of the curve to avoid disaster.

Like finance, healthcare is a highly-regulated industry where non-compliance can result in severe financial and reputational consequences for healthcare companies, and severe impact on people’s lives. We deal with HIPAA, MACRA, HITECH, and hundreds of other foreboding acronyms on a daily basis. A lot of attention goes to the terrific and important work of clinical decision support, wellness apps, and other patient care technologies, but problems in the back office of hospitals must be addressed as well. One of these problems is the amount and complexity of healthcare regulation, and our healthcare system’s inability to keep up.

In finance, where I spent the early part of my career, the adoption of what is termed “RegTech” (regulatory technology) was driven by the increasing complexity of financial technology and infrastructure sophistication.  As trades moved faster, and as algorithms, processes and organizations became more complex, the technologies needed to ensure regulatory compliance had to move in tandem.  The crisis we experienced in 2008 was partially the result of the inability of the industry’s regulatory capabilities to keep up with the pace of technological change.  In many ways, the industry is still playing a catch-up game.

As healthcare professionals, looking to the lessons learned by our colleagues in finance can help us predict patterns and stay ahead of the curve. Right now, I’m seeing alarming parallels to challenges faced in finance a decade ago.

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Robert Lord

The burden of regulation across our industry is simply staggering.  Thirty-nine billion dollars of regulatory burden is associated with healthcare annually, which is about $1,200 per patient, per year. Despite this high cost, we still have $1 trillion of fraud, waste and abuse in our healthcare system. With so much regulation, why are we seeing so little yield from that burden? In many cases, it’s because we’re merely checking boxes and not addressing core risks؅. Like finance, there was a great deal of effort on compliance with regulations, but not enough attention on addressing important systemic risks.

This is not to say I am against good regulation; in fact, many regulations serve to protect patients and improve care. The problem is that there are so many demands on healthcare systems, that compliance and regulation is often reduced to checking boxes to ensure that minimum defensible processes are built, and occasionally spot-checking that things look reasonable. We currently have nowhere near 100 percent review of activities and transactions that are occurring in our health systems every day, though our patients deserve nothing less. However, unless overburdened and under-resourced healthcare providers and compliance professionals can achieve leverage and true risk reduction, we’ll never be able to sustainably bend our compliance cost curve.

Systemic problems are often not discovered until something goes horribly wrong (e.g., Wall Street every decade or so, the Anthem data breach, etc.). Today In the financial industry, RegTech provides continual, dynamic views of compliance or non-compliance and allows management, compliance professionals and regulators to check compliance in real-time. They can view every record, understand every detail, and automate investigations and processes that would otherwise go undetected or involve lengthy and labor-intensive reviews.

The real promise of these new capabilities is to allow compliance professionals and regulators to perform the truest form of their jobs, which is to keep patient data secure, ensuring the best treatment for patients, and creating sustainable financial models for healthcare delivery. RegTech will open up lines of communication and help create conversations that could never have been had before—conversations about what’s not just feasible for a person to do, but what’s right to do for the people whom regulation seeks to protect.

No longer bound by limited resources that lead to “box-checking,” compliance officers can use new and powerful tools to ensure that the data entrusted to them is protected. At the same time, healthcare management executives can be confident that the enterprises they manage will be well served by risk reducing technological innovation.  Patients, the ultimate beneficiaries of healthcare RegTech, deserve as much.

Robert Lord is the co-founder and president of Protenus, a compliance analytics platform that detects anomalous behavior in health systems.  He also serves as a Cybersecurity Policy Fellow at New America.

 


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Assessing the New Cybersecurity Practices Publication: Why Small and Medium-Sized Care Organizations Have Reason to Rejoice

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A new set of voluntary cybersecurity practices just released by HHS offers practical advice and conceptual supports that fill information gaps
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How helpful will the new set of voluntary cybersecurity practices that the Department of Health and Human Services (HHS) released in late December, be, to the leaders of patient care organizations? Only time will tell, as part of the value of the release will only be made manifest as the leaders of patient care organizations move forward to implement some of those practices, and the potential success of such implementations is in some way measured and benchmarked.

But the release is a first start, at least. As Healthcare Informatics Associate Editor Heather Landi reported on January 2, HHS released the set of practices in the form of a publication “that marks the culmination of a two-year effort that brought together over 150 cybersecurity and healthcare experts from industry and the government under the Healthcare and Public Health (HPH) Sector Critical Infrastructure Security and Resilience Public-Private Partnership.”

“Cybersecurity is everyone’s responsibility. It is the responsibility of every organization working in healthcare and public health.  In all of our efforts, we must recognize and leverage the value of partnerships among government and industry stakeholders to tackle the shared problems collaboratively,” Janet Vogel, HHS Acting Chief Information Security Officer (CISO), said in a statement published with the release of the new publication.

Health Industry Cybersecurity Practices: Managing Threats and Protecting Patients (HICP), the primary publication of the Cybersecurity Act of 2015, Section 405(d) Task Group, aims to raise awareness, provide vetted cybersecurity practices, and move organizations towards consistency in mitigating the current most pertinent cybersecurity threats to the sector,” HHS officials stated. “It seeks to aid healthcare and public health organizations to develop meaningful cybersecurity objectives and outcomes. The publication includes a main document, two technical volumes, and resources and templates.”

The overall publication consists of several sections, the first being the HICP, which “examines cybersecurity threats and vulnerabilities that affect the healthcare industry. It explores five current threats and presents 10 practices to mitigate those threats; “Technical Volume 1: Cybersecurity Practices for Small Health Care Organizations,” which offers cybersecurity practices for small healthcare organizations; “Technical Volume 2: Cybersecurity Practices for Medium and Large Health Care Organizations”; the “Resources and Templates” portion, which “includes a variety of cybersecurity resources and templates for end users to reference”; and a Cybersecurity Practices Assessments Toolkit, which “helps organizations prioritize their cyber threats and develop their own action plans using the assessment methodology outlined in the Resources and Templates volume”—that last section being still under development as of Jan. 2.

As Landi reported, “The HICP publication aims to provide cybersecurity practices for this vast, diverse, and open sector to ultimately improve the security and safety of patients. The main document of the publication explores the five most relevant and current threats to the industry. It also recommends 10 cybersecurity practices to help mitigate these threats.”

What’s more, she wrote, “The main document presents real-life events and statistics that demonstrate the financial and patient care impacts of cyber incidents.  It also lays out a call to action for all industry stakeholders, from C-suite executives and healthcare practitioners to IT security professionals, that protective and preventive measures must be taken now. The publication also includes two technical volumes geared for IT and IT security professionals, one focusing on cybersecurity practices for small healthcare organizations, and one focused on practices for medium and large healthcare organizations.”

Among the salient statistics reported in the HICP:

  • Fifty-eight percent of malware attack victims are small businesses.
  • In 2017, cyber-attacks cost small and medium-sized businesses an average of $2.2 million.
  • Sixty of small businesses go out of business within six months of an attack.
  • And, 90 percent of small businesses do not use any data protection at all for company and customer information.

How does that translate into impacts on smaller healthcare organizations? Among other incidents, the HICP notes that:

  • A popular orthopedic practice announced that its computer system was hacked via breach of a software vendor’s log-in credentials. This breach put just under a half-million people at risk of identity theft. Of those, 500 patient profiles appeared for sale on the dark web. The information for sale included names, addresses, social security numbers, and other personally identifiable information (PII). Although not posted for sale, pertinent PHI such as X-ray results and medical diagnoses were also stolen.

 

  • A rural hospital had to replace its entire computer network after a ransomware cyber-attack froze the hospital’s electronic health record (EHR) system. Doctors were unable to review their patients’ medical histories or transmit laboratory and pharmacy orders. Officials were unable to restore essential services and could not pay the ransom for the return of their system. After consultations with the Federal Bureau of Investigation and cybersecurity experts, hospital officials made the difficult decision to replace the entire system.
  •  

Of particular practicality is some of the very basic advice given to the leaders of smaller healthcare organizations. To wit: “Doctors and nurses know that hand sanitizing is critical to prevent the spread of germs. That does not mean health care workers wash up as often as they should. Similarly, we know that cybersecurity practices reduce the risk of cyber-attacks and data breaches. Just as we are able to protect our patients from infection, we should all work towards protecting patient data to allow physicians and caregivers to trust the data and systems that enable quality health care. Just as health care professionals must wash their hands before caring for patients, health care organizations must practice good ‘cyber hygiene’ in today’s digital world, including it as a part of daily universal precautions,” the HICP notes. “Like the simple act of hand-washing, a culture of cyber-awareness does not have to be complicated or expensive for a small organization. It must simply be effective at enabling organization members to protect information that is critical to the organization’s patients and operations. Your organization’s vigilance against cyber-attacks will increase concurrently with your and your workforce’s knowledge of cybersecurity. This knowledge will enable you to advance to the next series of cybersecurity Practices, expanding your organization’s awareness of and ability to thwart cyber threats.”

Meanwhile, both smaller and larger patient care organizations will benefit from the technical supports, including a Security Risk Assessment Tool, a set of recommendations on medical devices and cybersecurity, and an incident response risk management handbook.

What this set of resources does is to fill a gap between theory and technical practice in a key area. Will it shift the entire landscape of cybersecurity for patient care organizations? No, that would be a far-too-ambitious goal. But the healthcare IT leaders of smaller and medium-sized patient care organizations in particular, will welcome practice advice and supports, as they move forward in their journeys around cybersecurity. Any such journey is inherently challenging, and federal publications and resources like these will be of real value in moving patient care organization HIT leaders forward.

 

 

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HHS Releases Voluntary Healthcare Cybersecurity Practices

January 2, 2019
by Heather Landi, Associate Editor
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In late December, the Department of Health and Human Services (HHS) released voluntary cybersecurity practices to the healthcare industry with the aim of providing practice guidelines to cost-effectively reduce cybersecurity risks.

The “Health Industry Cybersecurity Practices (HICP): Managing Threats and Protecting Patients” publication aims to provide guidance to healthcare organizations of all types and sizes, ranging from local clinics to large hospital systems.

The industry-led effort was in response to a mandate set forth by the Cybersecurity Act of 2015 Section 405(d), to develop practical cybersecurity guidelines to cost-effectively reduce cybersecurity risks for the healthcare industry.

According to HHS, the publication marks the culmination of a two-year effort that brought together over 150 cybersecurity and healthcare experts from industry and the government under the Healthcare and Public Health (HPH) Sector Critical Infrastructure Security and Resilience Public-Private Partnership.

“Cybersecurity is everyone’s responsibility. It is the responsibility of every organization working in healthcare and public health.  In all of our efforts, we must recognize and leverage the value of partnerships among government and industry stakeholders to tackle the shared problems collaboratively,” Janet Vogel, HHS Acting Chief Information Security Officer (CISO), said in a statement.

While technologies are vital to the healthcare industry and help provide life-saving treatments and improve patient care, these same technologies are vulnerable to myriad attacks from adversaries, ranging from criminals and hacktivists to nation-states, according to HHS. These technologies can be exploited to gain access to personal patient data or render entire hospital systems inoperable. Recent cyber-attacks against the nation’s healthcare industry continue to highlight the importance of ensuring these technologies are safe and secure.

“The healthcare industry is truly a varied digital ecosystem. We heard loud and clear through this process that providers need actionable and practical advice, tailored to their needs, to manage modern cyber threats. That is exactly what this resource delivers; recommendations stratified by the size of the organization, written for both the clinician as well as the IT subject matter expert,” Erik Decker, industry co-lead and Chief Information Security and Privacy Officer for the University of Chicago Medicine, said in a statement.

The HICP publication aims to provide cybersecurity practices for this vast, diverse, and open sector to ultimately improve the security and safety of patients. The main document of the publication explores the five most relevant and current threats to the industry. It also recommends 10 cybersecurity practices to help mitigate these threats.

The main document presents real-life events and statistics that demonstrate the financial and patient care impacts of cyber incidents.  It also lays out a call to action for all industry stakeholders, from C-suite executives and healthcare practitioners to IT security professionals, that protective and preventive measures must be taken now. The publication also includes two technical volumes geared for IT and IT security professionals, one focusing on cybersecurity practices for small healthcare organizations, and one focused on practices for medium and large healthcare organizations.

 

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CynergisTek, Protenus Partner on Privacy Monitoring Programs

December 26, 2018
by Heather Landi, Associate Editor
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CynergisTek, Inc., an Austin, Texas-based healthcare cybersecurity firm, is partnering with Protenus, a healthcare compliance analytics company, to combine the companies’ technology tools and services with a focus on patient privacy monitoring programs.

The partnership will grant health systems access to Protenus’ analytics platform that leverages artificial intelligence to gather data related to potential patient privacy risks, along with CynergisTek’s patient privacy monitoring services.

According to the Protenus research, insider incidents accounted for 23 percent of all breaches that occurred at health systems in Q3 2018. This figure will only continue increasing, indicating that now more than ever, health systems need a cost-effective solution to meet the daily challenges of managing patient privacy.

To address this need, CynergisTek and Protenus formed a preferred partnership to combine CynergisTek’s healthcare consulting experience and privacy programs with Protenus’ healthcare analytics technology to offer health systems both the people, processes, and technology components of a strong patient privacy monitoring program, according to the companies.

“As health systems face mounting challenges in creating and maintaining robust patient privacy monitoring programs, we identified a need to partner with a company offering complementary services so that health systems can act on the insights uncovered by our analytics,” Nick Culbertson, CEO and co-founder of Protenus, said in a statement.

 “Data privacy is evolving as a dominate theme in conversations, both in healthcare and other industries, and health systems need to take an end-to-end approach to patient privacy to truly address this complex and mission-critical challenge,” Mac McMillan, CEO and president of CynergisTek, said in a statement.

 

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