When cyber breaches occur at nursing homes and other healthcare facilities, the costs involved are often significant. Financial losses will generally include fees to repair compromised networks, data systems, along with forensic costs, notification costs, credit monitoring fees and punitive damages. Having adequate nursing home insurance coverage that addresses these issues is the only way to properly handle these types of crimes.
A resident affected by the breach will likely have legal grounds for a lawsuit, especially if the facility is deemed negligent in exercising its duty of care in safeguarding a patient’s records. In addition, nursing homes/healthcare facilities will be subject to federal fines and state penalties. This can include imposing a penalty per patient, up to a predetermined amount, as well as fines for late breach notifications.
Healthcare operators may not be aware of the risks faced
In many cases, nursing homes and other senior living facilities may not even have a plan in place to protect themselves or their patients and residents against cyber attacks. This may be due to the fact that these criminals who are able to electronically steal health data and records do so largely undetected. Quite often an attack will go unnoticed for months, even years until such a time as the data is actually used at which point the owner of that stolen data has now suffered sufficient harm.
Nursing homes need to develop a strong cyber risk management program and they also must carry cyber liability insurance to mitigate breaches large and small. A good cyber policy should include third-party and first-party coverage for the loss of, or damage to, any digital data that could be compromised. Coverage should include the cost of digital forensics and mandated notifications to victims, as well as the cost for crisis management or any fines and penalties that will likely be incurred.
In today’s climate of cyber security hacks with numerous network vulnerabilities being detected, nursing home owners and operators are at an increased risk for being sued, simply because they are not providing stringent safety and security protocols, which means they will be held liable for damages and can only counter these damages with nursing home insurance coverage.