The use of third-party vendors has become essential for delivering comprehensive patient care, streamlining operations, and enhancing service quality in healthcare. However, these relationships present complex data security challenges for healthcare organizations.

This article will explore the complexities of managing third-party risk in healthcare, how threat actors exploit vendor vulnerabilities, and provide best practices for safeguarding sensitive data when relying on vendors to conduct business.

Challenges managing third-party risk in healthcare

Modern healthcare organizations heavily rely on third-party vendors for a variety of services, including electronic health records (EHR) systems, billing, diagnostics, and cloud storage solutions.

While these partnerships enable greater efficiency and innovation, they also introduce substantial risks and penetration points for cyber attacks. Third parties often handle vast amounts of sensitive patient data, making them attractive targets for cybercriminals.

Ensuring that these external partners maintain effective security measures is crucial to protect patient information and comply with regulations such as the Health Insurance Portability and Accountability Act (HIPAA).

The primary challenges healthcare organizations face in third-party risk management include:

  • Complex supply chains. The healthcare supply chain involves numerous vendors and subcontractors, creating multiple points of potential vulnerability.
  • Regulatory compliance. Ensuring that all third parties comply with stringent regulatory requirements is both challenging and resource-intensive.
  • Data privacy. Protecting patient data from breaches and unauthorized access is critical to maintaining trust and avoiding legal repercussions.
  • Incident response. Developing effective incident response plans that include third parties can be difficult, especially when those parties have different policies and protocols.

How threat actors attack third-party vendors

Cyber criminals employ various tactics to exploit vulnerabilities in third-party vendors, often targeting weaker links to gain access to more secure networks. Here are some common methods:

Phishing and social engineering

  • Email phishing. Cyber criminals send deceptive emails to vendor employees, tricking them into disclosing login credentials or clicking malicious links.
  • Spear phishing. Targeted phishing attacks aimed at specific individuals within a vendor’s organization, often using personal information to appear legitimate.
  • Pretexting. Attackers create a fabricated scenario to persuade vendor employees to reveal confidential information.

Malware and ransomware

  • Malicious software. Cyber criminals deploy malware to infiltrate vendor systems, steal data, or create backdoors for future access.
  • Ransomware. Attackers encrypt vendor data and demand a ransom payment for decryption keys, often disrupting operations until the ransom is paid.

 Exploiting vulnerabilities

  • Software flaws. Cyber criminals exploit known and unknown vulnerabilities in software used or developed by vendors to gain unauthorized access.
  • Unpatched systems. Vendors failing to apply security patches and updates are susceptible to attacks exploiting outdated software.

Credential theft

  • Brute force attacks. Cyber criminals use automated tools to guess passwords and gain access to vendor systems.
  • Credential stuffing. Using stolen credentials from previous breaches to access vendor accounts, assuming users often reuse passwords.

Denial of Service (DoS) Attacks

  • Service disruption. Attackers overwhelm vendor systems with traffic, causing service outages and disrupting healthcare operations.

Other penetration points

In recent years, vulnerability points have evolved, as has the response to these security risks. While this is not a full list, here are a few top-of-mind concerns for many healthcare organizations:

  • Cloud vulnerabilities. As more healthcare providers move their data to the cloud, the security of cloud services has come under greater scrutiny. Breaches in cloud environments can lead to significant organizational data exposure.
  • Internet of Things (IoT) risks. The proliferation of IoT devices in healthcare, such as connected medical devices, introduces new vulnerabilities that can be exploited if not properly managed.
  • Medical device regulations. Adherence to regulations and guidelines (e.g., the FDA’s premarket guidance) focused on securing  medical devices is difficult for providers who must rely on device manufacturers.

Best practices for TPRM in healthcare

Effective third-party risk management in healthcare requires a comprehensive approach that includes identifying, responding to, and preventing cyber attacks. Here are some best practices:

Identifying third-party risks

The first step in third party risk management is to identify potential vulnerabilities in your vendor roster. Some key steps in this process include:

  • Vendor inventory: Maintain an up-to-date inventory of all third-party vendors. Inventories should include identification of sensitive data impacts, criticality of solutions and services provided, and level of access to your network.
  • Assess third-party risks: Evaluate vendors’ security policies, incident response capabilities, and compliance with regulations. Risks can be identified by reviewing independent audit reports and conducting detailed assessments of vendor-provided products and services.
  • Contractual agreements: Ensure that contracts with third parties include detailed security requirements, breach notification protocols, and compliance obligations. Also ensure that vendor requirements for your organization are understood and implemented.

Responding to third-party cyber attacks

While it is obviously best practice to prevent cyberattacks through robust cybersecurity protocols, responding appropriately to attacks that do occur is equally important. Here are a few ways to accomplish this:

  • Incident response planning: Develop and regularly update incident response plans that include third-party involvement. Ensure that vendors have robust and compatible incident response protocols.
  • Communication protocols: Establish clear communication channels with third parties for timely reporting of security incidents.
  • Forensic investigation: In the event of a breach, conduct a forensic investigation to determine the cause, scope, and impact of the incident. Work closely with the affected vendor to mitigate damage and prevent recurrence.

Reducing risk from third-party vendors

The highest order of cybersecurity strategy is preventing and predicting future threats. Here are some steps organizations can take to mitigate risks in their third-party partnerships:

  • Regular audits and monitoring: Perform regular audits and continuous monitoring of third-party vendors to ensure compliance with security standards and identify potential vulnerabilities.
  • Access controls: Implement strict access controls to limit third-party access to sensitive data. Use principles of least privilege to minimize exposure and conduct periodic access reviews.
  • Employee training: Educate employees and third-party personnel on cybersecurity best practices and the importance of protecting patient data.
  • Security standards: Require third-party vendors to adhere to industry-recognized security standards, such as the NIST Cybersecurity Framework or ISO 27001.
  • Encryption: Ensure that all sensitive data is encrypted both in transit and at rest to protect against unauthorized access.

Protecting the partnership

The integration of third-party vendors in healthcare is here to stay. While vendors are essential to the operation of modern medical practices, they also introduce significant risks that must be managed proactively.

By understanding the trends in third-party risks, learning from past breaches, and implementing best practices for identifying, responding to, and preventing cyber attacks, healthcare organizations can better safeguard patient data and maintain regulatory compliance.

The healthcare sector must remain vigilant and adaptable, continuously enhancing its third-party risk management strategies to address emerging threats.

To learn how you can bolster your TPRM, watch this free on-demand webinar on tackling third-party risk challenges.