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Posted on 12.02.2010

Health Data Breaches are Bad News…and are on the Rise

Healthcare crisis communicators beware.  As the amount of health data being digitized skyrockets, so do the chances for a breach. So far this year HHS reports 197 instances of breaches, each of which affected 500 or more people in one geographic area. These breaches involve the violations of medical records for  almost 6 million people.  And the implications are huge. Studies from the Ponemon Institute estimate that the average breach costs $7 million (i.e. $204 per record breached) and that more than 70 percent of that cost results from indirect expenses driven mostly by activities related to brand damage control and lost customer revenue in the future. Interestingly, those costs are estimated across all industries…healthcare expenditures in a breach situation are about 30 percent higher per record breached (i.e. $294). Even more recent data released by Ponemon in November estimates that the average healthcare organization experiences 2.4 breaches per year and that the lifetime value of a lost patient is $107,580. Requirements for notification of the individuals affected are also getting tighter. While federal law requires that these patients be notified within 60 days of the date of discovery of the breach, a growing number of states are requiring notification within five days (e.g. Connecticut, California, etc.). So the real question is, are you ready?

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