Should we be worried

About state-sponsored attacks against hospitals?

Security and the Board Need to Speak the Same Language

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The Maturity Paradigm

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Challenging job, but increasingly well paid

Medical Tourism - Growing in Popularity

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The Changing Face of the Security Leader

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Cyber Risk Insurance Won't Save Your Reputation

Be careful what you purchase and for what reason

Cyber Risk Insurance Won't Save Your Reputation

A myopic focus on healthcare compliance has resulted in checkbox mentality

A myopic focus on healthcare compliance has resulted in checkbox mentality, rather than a holistic risk-based approach to cybersecurity.

The financial and reputational costs associated with a security breach can be expensive and reputationally damaging. But in critical industries like healthcare, a cybersecurity attack could expose patients to some major safety risks that no amount of cyber breach insurance will likely fix.

Healthcare has historically had a myopic focus on privacy and protecting the confidentiality of patient information–largely caused by HIPAA, Caldicott, APA, PDPA, GDPR, and state breach rules. These have resulted in a skewed compliance-based approach to security by senior management and a 'checkbox mentality' of ‘have we done the minimum necessary’, rather than a holistic, risk-based approach to identify, protect, detect, respond, and recover from threats and vulnerabilities.

Risks change, and in healthcare those risks are changing quickly (as are legal liabilities and exposure to inadequate cybersecurity protection). CISOs, CROs, and GC/CLOs (General Council or Chief Legal Officers) are beginning to understand these changes and how cybersecurity posture and preparation are critical to protecting patient safety. Many of their bosses in the CEO seat are slowly beginning to understand not just their patient safety exposure in the age of digital inter-connectivity and cyber attacks, but also the potential impact on reputation.

“Cybersecurity is no longer a question of simple compliance,” said one hospital CEO at a recent US healthcare conference, “it’s about protecting the hospital’s reputation and ensuring patient safety while our systems are under attack and misbehaving."

"We purchased cyber risk insurance to cover all the un-budgeted costs associated with an attack. We keep our fingers crossed that we won’t need it.” he added.

But many insurers are now claiming that cyber attacks are an 'Act of War' and are therefore exempt from coverage under the terms of their policies, a fact that is currently being disputed in court by drug maker Merck and its insurers. So maybe the insurance, a company is counting on won't be there when really needed.

An OCR fine and the institution’s name being posted to the OCR 'Wall of Shame' is one thing, but patients being turned away or even held to ransom by cyber-attacks compromising medical devices are an entirely different order of magnitude!

Given our reliance today on HIT / HIoT systems to treat patients, there's a real risk that someone could die on us because critical systems are not available to diagnose and treat them following a cyber-attack. So too is the reputation hit when a hospital is forced to go on Full Divert following a cyber-attack as part of the British NHS had to when attacked by WannaCry in 2017. More recently, Campbell County Health in Wyoming, USA was forced to go on Full Divert following a similar cyber-attack.

“I would find it much more preferable to have HHS OCR camped out in my office examining all my papers following a breach, than the FBI walking the halls investigating a series of patient deaths at my hospital caused by a cyber-attack.” said a prominent San Francisco area CISO who preferred not to be named without clearing his statement with his employer. “One set of risks threatens executive jail time for wanton negligence, the other pretty much guarantees it,” he added.

“One set of risks threatens executive jail time for wanton negligence, the other pretty much guarantees it!”


Some years ago I did a walk-through of a hospital in Tasmania as part of its parent company’s risk assessment. The top floor was dedicated to a large and sprawling maternity department. Patient rooms with open doors and sleeping new moms and their infants lined either side of a wide corridor so nurses could come and go to check on both. Mothers and infants had similar plastic straps around their wrists with their name, D.O.B., and patient identifier. Neither were RFID-tagged. It would be very easy for someone to walk into a room, remove the sleeping child, and walk down the corridor to the elevator and take that straight to the underground parking complex. There was no physical security to stop them–only a few nurses moving in and out of rooms.


In our debrief, I asked the Obstetrician running the department what would happen if someone were to abduct a newborn. She protested at first to say that no one ever would, nor had anyone in the past – this was Tasmania - where there was a surplus of babies. But she did acknowledge that maybe this might be a problem in Sydney or Melbourne. After thinking about it for a minute, she announced, “In a small-knit community like ours, we would close! It would ruin our reputation and no one would come here to give birth again!”

The message here is that no amount of liability insurance is going to protect your reputation fully. It can cover costs for forensic investigation, breach notification, loss of business while down or recovering, and even for extortion payments if you are unable to recover critical data wiped out during a ransomware attack–but it can never cover what your customers think of you! Cyber risk insurance is valuable, but it’s no replacement for a well-functioning cybersecurity program.

Some of us continue to shop at Target following its massive breach of customer data some years ago, but most of us would never apply for a Target Card, nor would we ever consider using an email service provided by Yahoo for similar reasons!

“Once damaged, reputation is a big problem to fix” said the US hospital CEO. “It’s something that is becoming an increasing concern for all of us in healthcare. But how do you do that without spending a fortune on cybersecurity?”