Is Your Cyber Incident Response Plan Up to Snuff?

Episode 103: Is Your Cyber Incident Response Plan Up to Snuff?

Welcome to Medical Money Matters, the podcast where we break down the essentials of running a secure, efficient, and profitable medical practice. Today, we’re diving into a critical topic that’s only becoming more urgent as cyber threats grow: Is Your Cyber Incident Response Plan Up to Snuff?

Now, if you’re a physician running or managing a practice, you might think cybersecurity isn’t something you need to worry about daily. Think back to March of 2024, which saw the Change Healthcare Cyberattack. You may be thinking, “Change is a large organization, and I don’t have to worry as much as they do.” But in today’s environment, all healthcare practices are prime targets for cyberattacks, and a lack of preparation can have devastating consequences. In fact, according to recent studies, the healthcare sector has one of the highest rates of cyberattacks among all industries, with massive financial and reputational impacts following even a single breach.

So today, we’re going to cover the essentials of creating a solid Cyber Incident Response Plan—or CIRP for short—and why every practice, from small solo operations to large multi-physician groups, needs a plan in place. We’ll talk about the unique vulnerabilities that come with running a healthcare practice, especially as it grows, and the serious fallout that can follow a cyber incident. I’ll also offer some guidance on building a strong cybersecurity policy and show you how to protect your practice, your patients, and ultimately, your reputation.

Let’s start with the basics. What exactly is a Cyber Incident Response Plan?

A CIRP is essentially a structured plan designed to detect, respond to, and recover from cyber incidents. Think of it as a roadmap that helps guide your team through the process when a threat is detected. Having a plan in place can mean the difference between a minor disruption and a full-blown crisis that shuts down your practice and damages your patient trust.

Let’s break down the key components of an effective CIRP. First, there’s detection. You can’t respond to an incident if you don’t know it’s happening. Detection involves setting up tools and processes to monitor for unusual activity. This could be alerts for attempted logins from unknown locations or flags for large data transfers.

Then we move into containment. This is about limiting the damage once an incident has been detected. Let’s say there’s a ransomware attack: containment might mean isolating the affected systems to prevent the malware from spreading to other parts of your network.

After containment, you have eradication, which is exactly what it sounds like—removing the threat from your system entirely. This step involves cleaning up the affected areas, ensuring that the threat is neutralized, and taking measures to prevent similar issues in the future.

Next, there’s recovery. This is where you restore your systems to normal operations. Recovery can be complex and might involve restoring data from backups, testing systems to ensure they’re functioning properly, and communicating with patients and staff about what happened.

Finally, we have the post-incident review. After an incident is contained and operations are restored, a post-incident review allows you to assess what went well, what didn’t, and what needs to be improved for the future. This step is critical because cyber threats are constantly evolving, and each incident offers valuable insights to make your response stronger and faster.

In healthcare, a CIRP should be tightly integrated with your Disaster Recovery Plan. A Disaster Recovery Plan, or DRP, outlines how your practice will recover and resume operations after a major disruption, whether it’s a cyber incident, a natural disaster, or a system failure. While the CIRP focuses on the immediate response to an attack, the DRP ensures that data backups, alternative access solutions, and other resources are in place to bring operations back to normal as quickly as possible.

Key components of a strong Disaster Recovery Plan include data backups, alternative access solutions, and, importantly, regular testing. Data backups ensure that even if information is lost or compromised, you have secure copies available. Alternative access solutions might involve using a cloud-based system for critical data, which allows your practice to keep running even if local servers are compromised. And just like with emergency drills, running simulations of your disaster recovery plan is essential to make sure your team can execute it effectively when it’s truly needed.

Now, you might be asking, “Why are healthcare practices such big targets for cyberattacks?” It’s simple: healthcare data is incredibly valuable. A patient’s record holds a wealth of personal information—names, addresses, birthdates, Social Security numbers, and detailed health information. For cybercriminals, this data is far more valuable than a credit card number, and it can be sold for a high price on the black market. According to a recent Trustwave report, a medical record may be valued at up to $250 per record on the black market, compared to $5.40 for the next highest value record, which would be a credit card.

And unfortunately, it’s not just outside hackers we have to worry about. Threat actors can include malicious insiders, like employees who misuse their access, or advanced persistent threats—organized and highly-skilled groups targeting specific sectors. In healthcare, there are regulatory requirements, such as HIPAA, which means that a breach can lead to significant fines and increased scrutiny. So the stakes are high, not only financially but legally and reputationally.

Let’s look at some of the specific vulnerabilities that healthcare practices face. One major issue is the use of legacy systems—older software or hardware that may not have the latest security updates or patches. These systems can create gaps in your security that hackers are more than willing to exploit.

Then, there’s human error. Many breaches start with a phishing attack, where an employee unknowingly clicks on a malicious link or downloads a harmful attachment. Without regular training on cybersecurity best practices, staff may not recognize these threats when they appear in their inboxes.

And let’s not forget the issue of limited resources. Smaller practices especially may not have a dedicated IT team, which can lead to critical oversights in security protocols. As practices grow, the challenge only becomes more complex, with more devices, more access points, and a higher volume of sensitive data being processed and stored.

Now, as we talk about the risks that come with different practice sizes, let’s break down how your cybersecurity needs change as your practice grows.

If you’re running a small practice with 1 to 3 physicians, you likely have limited IT support, which means cybersecurity measures might be basic—perhaps just antivirus software and a firewall. But here’s the thing: even small practices need a plan for strong passwords, cloud-based backups, and basic staff training on spotting phishing attempts. Small practices may think they’re less likely to be targeted, but that can make them even more vulnerable—attackers know that these practices often lack sophisticated defenses, but they still have many thousands of medical records to hack.

As we move to medium-sized practices, with 8 to 10 physicians, things get more complicated. There’s increased data traffic, more patient information, and potentially unmonitored medical devices connected to your network. At this stage, multi-factor authentication, regular cybersecurity training, and a basic incident response plan should be standard. Here, even if you don’t have in-house IT, you should consider consulting with cybersecurity experts who can help you establish these protections.

For larger practices—those with 25 or more physicians—your cybersecurity needs take on the structure and scope of a small enterprise. The data volume, the number of users, and the diversity of devices make these environments more complex and more attractive to cybercriminals. Large practices should have a formalized cybersecurity policy, a dedicated response team, continuous network monitoring, and a comprehensive disaster recovery plan.

In a large practice, you also need to account for third-party access from vendors or partners, which adds another layer of complexity and risk. Any access point can be a vulnerability if it isn’t managed correctly, and that’s why advanced security measures, like endpoint detection and response systems, can be crucial at this level.

So, as you can see, the growth of a medical practice brings natural points of vulnerability—what I like to call points of infection—where your cybersecurity needs shift, often dramatically. Practices of any size can be hit, and without a response plan, even a small attack can quickly spiral into a crisis.

In the next segment, we’ll go deeper into the fallout of a cyber incident—how it can impact a medical practice’s operations, finances, and reputation. We’ll also discuss key leadership considerations for physician owners and provide tips for creating a robust cybersecurity policy and incident response plan. Stick with us—you won’t want to miss it.

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Welcome back to Medical Money Matters. In the first half of today’s episode, we covered the essentials of a Cyber Incident Response Plan and the specific cybersecurity needs as practices grow. Now, let’s talk about what actually happens when a cyber incident hits a medical practice, why the fallout can be so damaging, and what steps you, as a physician leader, can take to protect your practice.

So, let’s imagine this scenario: your practice becomes the target of a ransomware attack. Suddenly, you can’t access your Electronic Health Records system. Patient charts, scheduling, billing information—it’s all locked up. You’re facing operational shutdown, potentially losing tens or hundreds of thousands of dollars a day, all while patients go without care. This is the kind of fallout no practice wants to face, but unfortunately, it’s increasingly common.

First and foremost, there’s operational disruption. When a cyber incident strikes, the immediate impact is often a total halting of practice operations. Without access to patient records, scheduling systems, or billing software, your team may not be able to function. In healthcare, any delay can be critical. Patients depend on timely care, and a shutdown forces cancellations, rescheduling, and an overall backlog that can take days or even weeks to recover from.

The financial impact is another major factor. Beyond lost revenue from canceled appointments, there are the direct costs of managing a breach. You may need to hire IT forensics experts to identify and eliminate the threat, restore systems, and conduct audits. Recovery costs can pile up, and if patient data is compromised, fines for regulatory violations can be severe. Plus, insurance premiums often rise after a breach.

So, even if you have cyber insurance, the total cost to the practice can be significant.

And then there’s reputational damage. In healthcare, trust is everything. Patients expect that their sensitive health information is handled with the utmost security. If a breach compromises that trust, it’s not uncommon for patients to seek care elsewhere. This loss of trust can also affect referrals and partnerships. For a small or medium-sized practice, just one incident can lead to a lasting hit on reputation.

Finally, a cyber incident has regulatory consequences. Healthcare data is protected by regulations like HIPAA in the U.S., and any breach of patient privacy can lead to legal action and hefty fines. Following a breach, your practice might face increased regulatory scrutiny, with follow-up audits to ensure compliance going forward. This added oversight can be both costly and time-consuming.

As you can see, the fallout of a cyber incident can be incredibly damaging to a medical practice. So, what can you do as a leader to ensure your practice is protected?

Let’s get into leadership considerations for physician owners. As a physician, you might not have a background in IT or cybersecurity, but as the leader of your practice, it’s crucial that you champion cybersecurity as part of patient safety. Think of it as an extension of the care you provide—securing patient information is just as important as the treatment you deliver.

First, let’s talk about policy enforcement. As a leader, it’s up to you to set a standard for cybersecurity in your practice. This means not only establishing protocols but also ensuring your team understands and follows them. Staff need to know that cybersecurity isn’t optional. Password policies, access controls, data encryption—these aren’t just “IT’s problem.” They’re a responsibility that every team member shares.

Awareness and training are also key. Many cyber incidents, especially phishing attacks, are successful because staff aren’t trained to recognize the signs. Regular, mandatory training sessions on cybersecurity best practices can go a long way. Teach your staff how to identify phishing emails, avoid suspicious links, and report anything unusual. Make this part of the culture of your practice, so that every staff member feels responsible for maintaining security.

Another critical area is resource allocation. As a physician owner, you have the power to allocate a budget toward necessary cybersecurity tools and resources. It’s easy to view cybersecurity as a costly investment, but the potential losses from a data breach far outweigh these preventive expenses. This might mean investing in antivirus software, a firewall, data encryption, or even external consulting services for larger practices. Even though these may seem like “extras,” they’re actually essentials for protecting your practice.

Now, let’s discuss how to actually construct a robust cybersecurity policy and incident response plan. Creating a cybersecurity policy doesn’t have to be overly complex, but it does need to be comprehensive and regularly updated to stay effective.

One of the first steps is data classification. Not all data is equally sensitive, so classifying it based on sensitivity allows you to apply the right level of protection. For example, patient health records require the highest level of security, while some administrative information may not need the same stringent controls. Classifying data also helps you prioritize what needs to be encrypted or restricted.

Access control is another essential part of any cybersecurity policy. Not everyone needs access to everything. Implementing the principle of least privilege means each employee has access only to the information necessary for their role. By limiting access, you reduce the potential damage if an account is compromised. Regularly review access permissions and update them as roles change.

Data encryption is crucial. All data, especially patient data, should be encrypted both in transit and at rest. Encryption adds a layer of security that makes it much harder for attackers to use the data, even if they manage to breach your system.

Another key element of a strong policy is vendor management. Many practices work with third-party vendors who may have access to sensitive data or systems. Make sure these vendors comply with your security standards and have their own cybersecurity measures in place. If your vendor experiences a breach, your data could be compromised as well, so it’s important to vet any third parties carefully.

Now, let’s talk about building your Incident Response Plan, or CIRP. Start by designating key individuals who will lead the response in the event of a cyber incident. This could be your office manager, IT lead, or a third-party cybersecurity partner. Each person should know their role and responsibilities when a breach is detected.

Next, conduct training and simulations. It’s not enough to have a plan on paper—your team needs to know how to execute it. Run mock incidents to practice your response, identify weak points, and improve your team’s readiness. This preparation can be the difference between an orderly response and a chaotic scramble.

Establish clear communication protocols for notifying stakeholders. This includes staff, patients, and regulatory bodies. In the case of a data breach, HIPAA requires timely notification of affected patients. Having pre-drafted communication templates can speed up this process and ensure your messaging is clear and consistent.

Finally, it’s important to review and update your CIRP regularly. Cyber threats are constantly evolving, and your plan needs to evolve with them. Make it a point to review your CIRP at least annually, or more often if there are significant changes in your practice structure, technology, or threat landscape.

To wrap up, here’s what we’ve covered: Cyber incidents can have major consequences on practice operations, finances, and reputation. As a physician leader, it’s your responsibility to ensure cybersecurity is prioritized, from establishing a solid policy to building a responsive and well-practiced CIRP. Protecting patient data is an essential part of the care you provide, and in today’s world, it requires proactive planning and commitment from everyone in your practice.

Thank you for joining me today on Medical Money Matters. I hope this discussion on cybersecurity inspires you to review your practice’s current policies and consider areas for improvement. If you found today’s episode helpful, please subscribe, share it with colleagues, and visit the Health e Practices website at www.healtheps.com for more resources on safeguarding your practice.

Until next time, stay secure and keep building a better, safer healthcare practice.