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HIPAA Risk Assessment : What It Is and How to Perform It

Published January 16, 2024

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The digitalization of healthcare has come with an array of benefits and challenges. For organizations handling healthcare data, adequately protecting their users' healthcare data is a paramount obligation.

The Health Insurance Portability and Accountability Act (HIPAA) is a data regulation within the United States that requires subject organizations to protect the confidentiality and security of users' protected health information (PHI).

For organizations, a critical element to ensure that they can render this responsibility effectively is a HIPAA risk assessment.

Read on to learn more about a HIPAA risk assessment, who needs to conduct it, how it can be conducted effectively, and what solutions can be leveraged to do so.

What is a HIPAA Risk Assessment?

Conducting a security risk assessment is a mandated security measure for organizations as outlined in the HIPAA Security Rule. The Security Rule requires covered entities and business associates to conduct an accurate and thorough assessment of the potential risks and vulnerabilities to electronic protected health information (ePHI).

Moreover, although there is no direct requirement to conduct a privacy risk assessment under HIPAA, the law requires covered entities to reasonably safeguard protected health information from any intentional or unintentional use or disclosure that is in violation of the standards, implementation specifications, or other requirements of this rule.

Consequently, to comply with this standard, the covered entities will have to identify risks, threats, and vulnerabilities to PHI in the same way as ePHI. Thus, a privacy risk assessment under HIPAA is practically indispensable, as it enables covered entities to formulate the requisite policies and procedures mandated by the Administrative Requirements.

Organizations must treat such risk assessments with the utmost urgency and criticality. Such an assessment is vital to an organization's ambitions to remain regulatory compliant and avoid potential security incidents related to PHI.

Another reason to take the HIPAA risk assessment seriously is the financial consequence of not doing so. Subject organizations that do not carry out their responsibilities per the HIPAA requirements can face fines ranging from $100 to $50,000 per violation, up to a maximum of $1.5 million per year for repeated violations by the Office for Civil Rights (OCR).

Who Needs to Conduct a HIPAA Risk Assessment

Individuals, organizations, and agencies that fall under the definition of a ‘covered entity’ must comply with this HIPAA requirement. Covered entities under HIPAA include the following categories:

1.Health Plans

These include Individual or group plans that provide or pay the cost of medical care. The health plans may include the following:

  • Health insurance companies.
  • Health maintenance organizations.
  • Employer-sponsored health plans.
  • Government programs that pay for health care, like Medicare, Medicaid, and military and veterans’ health programs.

2. Healthcare Providers

These individuals or entities who electronically transmit health information in connection with certain transactions. These transactions include claims, benefit eligibility inquiries, referral authorization requests, or other transactions for which HHS has established standards under the HIPAA Transactions Rule. The health care providers include but are not limited to doctors, psychologists, dentists, clinics, pharmacies, nursing homes, etc.

3. Healthcare Clearinghouses

Entities that process nonstandard information they receive from another entity into a standard format or data content or vice versa. Healthcare clearinghouses may include billing services, repricing companies, community health management information systems, and value-added networks and switches if these entities perform clearinghouse functions.

In addition to the covered entities, HIPAA applies to ‘business associates’, which refers to an individual or entity that performs certain functions on behalf of a covered entity that entails the use or disclosure of PHI.

Such a risk assessment should be carried out at least once a year, with the subject organization expected to deploy the latest methodologies, technologies, and upgrades within its IT system during the risk assessment.

Steps in a HIPAA Risk Assessment

HIPAA is a comprehensive regulation with clauses and provisions covering every major requirement and obligation-related question an organization may have. However, it does not provide a strict assessment methodology. As per HIPAA guidelines, a risk assessment must address risks and vulnerabilities in three areas:

  • Administrative;
  • Physical; and
  • Technical Safeguards

Organizations are expected to devise their compliance by referring to standards such as the NIST 800-30 and conducting an assessment that adequately addresses their obligations as effectively as possible.

That being said, here is what a typical HIPAA risk assessment should involve for most organizations:

Step 1. Determine the Scope of the Analysis

Determining the scope of the risk assessment is a crucial initial step for organizations to comprehend the specific risks and vulnerabilities that are most likely to affect an organization.  By determining the scope of the assessment, an organization can determine what resources need to be allocated to this exercise and ensure all relevant risks and threats are appropriately identified, including those associated with bad actors, insider threats, and human errors. This necessitates including all relevant electronic and physical media that may contain ePHI.

Step 2. Identify and Document Potential Threats and Vulnerabilities

In the second stage, the organizations are required to identify and document potential threats. These threats may vary based on the specific circumstances of the organization's environment. Doing so will give a better idea of an organization's vulnerability and help devise an adequate response for each threat.

Step 3. Assess your Current Security Measures

Once an organization has adequately identified all relevant security threats, it can move on to mitigating them by assessing the effectiveness of the current security measures. An organization can gauge how well prepared its current security measures are to deal with the threats identified and what degree of change, upgrade, and overhaul is required. This will include assessing technical measures such as access control, authentication, data encryption, automated logoffs, and non-technical measures such as physical security measures, standard operating procedures, and access policies.

Step 4. Determine the Likelihood of Threat Occurrence

Simply cataloging all threats an organization faces is merely the first step. Not all of the identified threats pose an equal danger to an organization. Hence, thoughtful deliberation and analysis of potential threats provide valuable insights into the likelihood of a threat evolving into an actual incident. These insights serve as a foundation for prioritizing security measures and deploying resources effectively. By allocating resources appropriately, organizations can focus on mitigation measures aimed at addressing the most immediate and impactful threats, thereby enhancing their overall security resilience.

Step 5. Determine the Potential Impact of Each Threat Occurrence

In this crucial step, organizations proactively assess the potential consequences of a threat occurrence. While all efforts must be undertaken to ensure no security incident occurs, it is just as important to know what outcomes to expect in case an incident does occur. Details related to the possible outcomes of an incident, the potential economic and financial repercussions, and the operational impact should all be considered. An organization can utilize either a qualitative method, a quantitative method, or a combination of both to measure the impact on the entity.

Step 6. Identify the Risk Level

Not all threats are equal. Some may pose a greater operational risk than others. Categorizing potential incidents with risk levels such as High, Medium, or Low enables organizations to assess their options more effectively. Conducting a thorough evaluation of each risk and considering its potential impact enables organizations to establish a clear hierarchy of risks.

Step 7. Determine Appropriate Security Measures and Finalize the Documentation

Following the identification of potential security risks and their associated risk levels, organizations proceed to determine the most effective measures to counter each threat.  Concurrently, the organization also finalizes the documentation of the entire risk assessment process, ensuring compliance with relevant requirements.

Additionally, this documentation can be leveraged to guide organizational policy and further improvements in the security measures undertaken.

Step 8. Periodically Review and Update the Risk Assessment

Threat actors constantly evolve their methods and tools at a rapid pace. What once constituted a state-of-the-art protection mechanism might now be considered a technical dinosaur, as exemplified by the case of the Data Encryption Standard (Federal Information Processing Standard 46-3).

Regular reviews of the threats faced by the organization, assessing the likelihood of their occurrence, understanding their potential impact, and evaluating the effectiveness of the organization's security measures against these threats form the seemingly simple yet effective key to a HIPAA compliance risk assessment that yields optimal results. This iterative process ensures that the assessment remains current and adaptable to the evolving landscape of cybersecurity threats.

How Securiti Can Help

Today's users expect organizations to be highly proactive in undertaking relevant measures to ensure their collected data is appropriately protected. Such expectations are often exacerbated when it comes to health-related data.

Hence, organizations need to conduct regular and thorough HIPAA risk assessments to ensure that their internal security defenses are up-to-date and ready to counter potential threats.

This is where Securiti can help.

Securiti is the pioneer of the Data Command Center, a centralized platform that enables the safe use of data and GenAI. It provides unified data intelligence, controls, and orchestration across hybrid multicloud environments. These include dedicated modules such as its vendor risk assessment and internal assessment automation solutions that allow organizations to conduct all their HIPAA risk assessment-related activities both effectively and efficiently.

Request a demo today and learn more about how Securiti can help you comply with your HIPAA compliance journey.

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