Healthcare Vendor Risk Management (VRM) Is More Important Than Ever

Third-Party Risk

The healthcare industry has long been a prime target for cybercriminals looking to gain access to patients’ personal information or to disrupt the operations of healthcare facilities. The recent adoption of new technology and remote work has created more potential targets for hackers.

Data breaches in the healthcare industry have proven to be some of the most costly. In their annual report titled The Cost of a Data Breach, IBM estimated the exorbitant cost of a breach in healthcare to be around $7.13 million — that’s almost two and a half times higher than the average across all other industries.

While risk management strategy in healthcare has typically focused on the role of patient safety and the reduction of medical errors to protect against financial liability, it is critical that healthcare organizations also take into account the rising cyberattacks on medical infrastructure and on the third-party vendors that healthcare organizations rely on.

As we know, vendor risk management, or third-party risk management, is a type of risk management strategy with the goal of identifying and reducing risks associated with an organization’s use of third-party vendors. Vendor risk management allows an organization to effectively carry out due diligence across the entirety of their vendor ecosystem.

Oftentimes, the risks associated with vendors and third-parties will fall into one of the following three categories:

  • Financial/reputational: The risk that a vendor or third-party could have a negative impact on your revenue or reputation.
  • Legal and regulatory: The risk that a vendor or third-party will affect your ability to comply with regulations.
  • Operational: The risk that a vendor or third-party could have an impact on your ability to operate as normal.

So, why is VRM so important in healthcare?

It goes without saying that the smoother and more secure that a healthcare facility is able to run — be it a small clinic or a large hospital — the better off we all are. Especially today, in light of the ongoing pandemic, it’s crucial that these facilities remain operational and compliant at all costs, because people’s lives and well-being are very much at stake.

Healthcare facilities gather and store very sensitive information on their patients, which make them a prime target for cybercriminals and threat actors. Implementing and maintaining mature vendor risk management programs — especially in healthcare — has arguably never been more important.

Where Iceberg Networks comes in

As a leading provider of Governance, Risk, and Compliance solutions, our experts are committed to helping organizations develop mature and resilient vendor risk management programs. For more information on our successful healthcare related solutions, check out our How Iceberg APS Helped Bring a Hospital’s GRC Program Back to Health case study.

Have questions? Get in touch with us here.

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