Best Practices for Implementing a Successful Third-Party Risk Assessment Program in Healthcare Settings

Third-party risks come from suppliers, vendors, or service providers that work with a healthcare organization’s systems, data, or processes. These groups can cause cybersecurity problems, disrupt operations, break rules, or harm a healthcare provider’s reputation. Healthcare is a common target because patient data is very valuable. Patient data often includes permanent identifiers that are worth more on illegal markets than many other types of information.

Organizations have special challenges because third parties often connect through networked medical devices, software, cloud services, and communication tools. The growing Internet of Medical Things (IoMT), which includes items like ICU monitors, wearable sensors, and diagnostic machines, adds more complexity and chances for security problems.

Regulations are changing too. For example, the FDA updated cybersecurity rules for IoMT devices starting in October 2023. The New York State Department of Health’s new cybersecurity rules begin in October 2024. Healthcare groups must keep their third-party risk programs up to date to meet these security and legal rules.

Core Components of a Third-Party Risk Assessment Program

A good third-party risk assessment program is a clear process for finding, checking, managing, and watching risks from outside vendors. This happens during the whole time a vendor works with the healthcare group. This includes when the vendor starts work, during their work, and when they finish. The main steps are:

1. Vendor Identification and Classification

Healthcare groups should first list all third-party vendors. This list includes IoMT providers, cloud service subscriptions, IT consultants, and communication platforms. It is important to sort these vendors by their risk and importance.

• Tier 1 (High Risk): Vendors who have access to sensitive patient data or who are key to clinical operations.
• Tier 2 (Moderate Risk): Vendors who provide support services and have limited access to critical data.
• Tier 3 (Low Risk): Vendors who have little access or impact on operations.

This system helps healthcare groups focus on managing the highest-risk vendors first.

2. Vendor Risk Evaluations and Assessments

Before making a contract, healthcare groups should do detailed risk checks of vendors. These checks include:

• Security Controls Review: Look at the vendor’s cybersecurity measures like encryption, access controls, fixing vulnerabilities, patching plans, and following FDA or HIPAA rules.
• Regulatory Compliance Checks: Make sure the vendor follows laws such as HIPAA, FDA guidance, and state laws.
• Operational Resilience: Check the vendor’s plans for business continuity, incident response, and disaster recovery.
• Reputational and Financial Risks: Look at past issues like data breaches or lawsuits to judge risk.

Using known risk frameworks like ISO 14971:2019 for medical devices or the IMDRF framework for medical device software helps make these checks standard.

3. Contract Management and Risk Remediation

Contracts with vendors should clearly say what security is needed, how to report incidents, who is responsible, and audit rules. Fixing risks is important. Vendors must give timelines and show how they will fix problems before and during their work.

4. Continuous Monitoring and Periodic Reassessments

Assessing risk is not just once. It needs ongoing monitoring with regular audits, checking security changes, and confirming the vendor follows new rules. Healthcare groups should use software tools to watch risks in real time instead of manual work that can be slow or have mistakes.

5. Vendor Offboarding Procedures

When stopping work with a vendor, healthcare groups must make sure the vendor loses access to systems and patient data safely. Sensitive information should be retrieved or destroyed. It is important to check that no risks remain. Keeping good records helps with audits and managing any problems later.

Addressing the Internet of Medical Things (IoMT) in Vendor Risk Assessments

The IoMT is growing fast. Spending in the U.S. healthcare sector on IoMT devices may pass $400 billion by 2027. These connected devices help with care, remote monitoring, early detection, and saving costs. But they also bring cybersecurity risks.

The FDA rules starting in October 2023 say all new IoMT device vendors must have cybersecurity plans with ongoing risk monitoring and regular updates. Healthcare groups need to:

• Inventory IoMT Devices: Teams from different departments must find and classify all connected medical devices in clinical and non-clinical areas.
• Comprehensive Risk Assessment: Use industry standards to check risks like software bugs, access controls, and encryption.
• Security Controls: Separate IoMT devices from core IT systems using network segmentation, use intrusion detection to spot attacks early, and set up safe remote access for vendors.
• Incident Response Planning: Work with vendors to make clear disaster recovery and emergency plans.

Not managing IoMT risks well can cause data breaches, fines, disruptions in service, and lose patient trust.

Cybersecurity and Compliance Considerations in Third-Party Risk Management

Healthcare organizations handle a lot of protected health information (PHI). This makes them targets for attacks like ransomware, phishing, and social engineering. Third-party systems add more ways for attackers to reach the network. A strong cybersecurity program that includes third-party risks is needed.

Important cybersecurity steps for vendors include:

• Annual Risk Assessments: Write down vendor risks. Update yearly or when big changes happen.
• Third-Party Security Audits: Require yearly outside checks of vendor security, like penetration tests and reports on incidents.
• Access Control: Use multi-factor authentication (MFA), review user privileges often, and allow only the needed access for vendors.
• Cloud Security: For vendors handling cloud PHI, confirm encryption, contracts, and regular checks of the cloud services.
• Staff Training: Teach healthcare workers involved with vendors about cybersecurity, such as how to spot phishing.
• Incident Reporting: Vendors must quickly tell healthcare groups if data breaches or security problems happen. This helps with fast fixes.

Rules like the New York State Department of Health’s cybersecurity requirements (starting October 2024) require hospitals to keep audit logs, report important incidents within 72 hours, and follow the NIST Cybersecurity Framework and Health Industry Cybersecurity Practices (HICP). These are likely to become common in other states too, so following these rules is important.

Role of Collaboration and Governance in Managing Third-Party Risks

Managing third-party risks cannot be just IT’s job. It needs teamwork from clinical leaders, administrators, purchasing teams, lawyers, and cybersecurity experts.

• Shared Governance: Involving clinicians in risk decisions helps balance security and workflow needs. This supports the use of security policies.
• Stakeholder Buy-In: Leaders, including Chief Information Security Officers (CISO), should support the program, with clear roles and accountability.
• Cross-Departmental Partnerships: Purchasing teams help by checking vendors carefully when they start and during ongoing evaluations.
• Communication Channels: Good communication between all groups helps share information fast, raise risks, and respond to incidents together.

Healthcare groups that share responsibility for cybersecurity lower risks from mistakes and improve protection against threats.

Leveraging AI and Automation to Enhance Third-Party Risk Management

Artificial intelligence (AI) and automation tools can help manage the hard parts of third-party risk in healthcare. Manual work can be slow and have mistakes, but technology can help.

Automated Risk Assessments and Monitoring

AI tools can collect data from vendor assessments, watch security changes continuously, and score risks using real-time data. This helps healthcare groups find problems early, manage many vendors without hiring more people, and keep up with rules.

Workflow Automation for Vendor Management

Automation software can handle the whole vendor process. It can remind staff about contract renewals, start new assessments, track deadlines for fixes, and make audit reports. This cuts down on paperwork and makes risk management faster and more accurate.

Enhanced Incident Detection and Response

AI can spot unusual vendor actions and network traffic that may show security problems. Early warnings let security teams act fast to reduce harm to patient care.

Examples of Real-World Impact

Health groups like Baptist Health and Intermountain Health use AI-based risk management tools. These tools help organize IT risk work centrally and compare with peers. They have made vendor assessments quicker and improved how resources are used. This shows how AI and automation work in real life.

Summary

Running a good third-party risk assessment program in healthcare needs a clear process that covers finding vendors, sorting them by risk, assessing risks, watching them continuously, and ending vendor relationships safely. Security, following rules, and operational strength are important.

The growth of connected devices like IoMT adds new risks that healthcare groups must watch closely.

Working together across clinical, IT, and administration teams with leadership support helps make sure risk management fits clinical work and organizational goals. Using AI and automation can make vendor risk programs more efficient, accurate, and able to grow.

Healthcare groups in the U.S. that want to protect patient data, keep care quality high, and follow laws should use these best practices for their third-party risk programs.