In today’s digital age, Federally Qualified Health Centers (FQHCs) rely heavily on electronic health records (EHR) and digital systems to manage patient information and operations. While this technological integration brings numerous benefits, it also exposes FQHCs to significant cyber risks.
The reality of cyber threats
Cyber-attacks on healthcare organizations are becoming more frequent and costly. According to a report by IBM Security, the average cost of a ransomware attack in the healthcare sector can exceed $4 million. Yet, many FQHCs find themselves with cyber coverage limits as low as $25,000, which is grossly insufficient to cover the costs associated with a significant cyber incident.
Why standalone cyber coverage is essential
- Comprehensive protection: Standalone cyber policies cover a wide range of risks, including data breaches, ransomware attacks, business interruption, and regulatory fines. This breadth of coverage is essential for addressing the multifaceted nature of cyber threats.
- Support for incident response: Standalone policies often include access to specialized incident response teams that can help manage and mitigate the impact of a cyber-attack. This support can be invaluable in the critical hours and days following a breach.
- Regulatory compliance: Healthcare organizations are subject to strict regulations, such as HIPAA, which mandate the protection of patient information. Adequate cyber insurance helps ensure compliance and provides coverage for regulatory fines and penalties.
Real life FQHC story
To address the cyber risk exposure of a large FQHC in the Midwest, several steps were taken. A thorough review of their existing insurance policies was conducted, revealing the limited coverage of just $25,000 for cyber incidents. Following this, a detailed cyber risk assessment was performed, identifying potential vulnerabilities and estimating the potential costs associated with a cyber incident.
Based on the findings, it was strongly recommended that the FQHC obtain a standalone cyber insurance policy with a significantly higher coverage limit of $500,000. This comprehensive policy would include coverage for ransomware attacks, data breaches, business interruption, and regulatory fines. Additionally, the new policy would provide access to a dedicated 24/7 incident response team and proactive risk management services to help prevent future attacks.
By implementing this standalone cyber policy, the FQHC significantly enhanced their protection against cyber threats, ensuring they have the necessary financial resources and expert support to recover quickly and minimize any potential disruptions.
Next steps
For FQHCs, ensuring comprehensive cyber coverage is not just a best practice—it’s a necessity. A standalone cyber insurance policy offers the depth and breadth of coverage needed to protect against the growing threat of cyber-attacks. To learn more, check out our cyber security assessment flyer.
