In 2024, network Change Healthcare experienced a massive breach involving 190,000,000 patients. This event shocked healthcare organizations, exposing flaws in the traditional risk management model. More than ever before, today’s hospitals and insurers need a risk program that delivers results, not subjective reports. Is GRC the solution for healthcare companies?
What Is GRC in Healthcare?
GRC stands for governance, risk, and compliance. The purpose of a GRC framework is to help healthcare organizations develop a unified program for managing risk, regulatory compliance, and information security programs effectively.
The three components support each other: Complying with leading regulations and IT standards improves governance and modernizes risk management. In turn, ongoing risk monitoring makes policies more flexible and effective.
Integrated Compliance
Even though it’s the last letter, compliance is the soul of GRC frameworks. The aim is to make compliance the “default setting” instead of something you force frustrated personnel to do.
Whether it’s HIPAA, PCI DSS, SOC 2, or HITECH CSF, mapping the required controls to your day-to-day operations improves employee adoption rates and reduces waste. As government and industry regulations become more complex and costly, the advantages of GRC are impossible to ignore.
Proactive Risk Management
In 2023, there were nearly 750 separate data breach incidents in the United States alone. Traditional risk management takes a reactionary approach, leaving healthcare companies to deal with damaging events.
But insurance can’t recover patient trust, investor confidence, or a brand’s reputation. Healthcare networks that follow GRC apply proactive risk management to reduce vulnerabilities, leverage technology to customize risk strategies to the organization’s operations, and use ongoing risk monitoring to mitigate the impact of cyberattacks.
Risk-Informed Governance
Hospitals must take costs into account when making decisions, but a short-term focus that excludes compliance and data security risks can severely damage your organization’s financial well-being. The average cost of a data breach in healthcare ($9.7 million per incident) is nearly double that of other industries. The impact of disruptions to payment systems and EHR networks can be even more devastating.
GRC gives privacy and security compliance a seat in the boardroom. Instead of red tape when risks appear, departments rapidly receive the right guidance to avoid, eliminate, or contain threats. This ultimately saves healthcare organizations money and helps — not harms — capital flows and operations.
Why Is GRC Beneficial for Healthcare Organizations?
An integrated, organization-wide approach to GRC pillars eliminates the bureaucratic obstacles of traditional management methods. This provides many benefits:
- Improving strategic outcomes: Accurate statistical models, up-to-date best practices, and distilled insights from stakeholders at every level can inform better decisions.
- Making compliance more cost-effective: Getting rid of duplicate workflows and building compliance into everyday operations reduces waste.
- Promoting data sharing: Breaking down data silos and centralizing decision-making is better for cybersecurity, not worse.
- Reducing the risk of regulatory violations: GRC tools help ensure frontline workers, executives, IT personnel, and other teams implement compliance instead of just talking about it.
- Strengthening cybersecurity defenses: Compliance with HITECH and HIPAA helps healthcare organizations create robust defenses against malware, ransomware, phishing attacks, and insider threats.
- Enhancing risk management and threat mitigation: GRC emphasizes an adaptive approach to cyber, operational, financial, legal, and regulatory risks, enabling organizations to take the optimal actions as circumstances evolve.
Medical professionals can easily understand the benefits of comprehensive programs as opposed to dealing with one symptom at a time. When a patient is diagnosed with heart trouble, more is involved than a surgical intervention. Hospitals coordinate follow-up diagnostics, specialized care services, rehabilitation, preventative care, and medication together to enhance treatment results and improve the patient’s quality of life.
What Are the Applications for GRC in Healthcare?
Healthcare isn’t the only industry that benefits from GRC, but this modern approach to compliance and risk management is a perfect fit for the challenges of today’s healthcare environment.
1. Organization-Wide HIPAA Compliance
HIPAA regulations require hospitals, health insurers, HMOs, and other covered entities to implement strict standards for privacy and data security. A HIPAA compliance program also needs effective policies and practices for cyber risk management and breach recovery actions.
How well do the individual members of your team understand HIPAA standards? Without a dedicated framework and mandated roles, it’s all too easy for violations to happen. GRM corrects this issue by making sure each member of your organization understands what HIPAA compliance means for them, without getting overloaded by rules that don’t apply.
To illustrate, think of your HIPAA compliance officer as the captain of a large ship. GRC would be the ship’s communications systems, linking engines, cargo areas, security systems, GPS, and maintenance crews. The board of executives may “own” the ship, but the captain knows how to navigate turbulent waters successfully. GRC helps healthcare organizations meet HIPAA requirements efficiently and currently.
2. Navigating GDPR Requirements
Many hospitals have had decades to work on their HIPAA compliance programs, but Europe’s General Data Protection Regulation is comparatively new and confusing for many organizations. Similar to HIPAA compliance, GRC frameworks map well to GDPR requirements.
All patient health information is considered “sensitive data” under GDPR, including biometrics, test results, and medical records. Global insurance companies, healthcare networks, and third-party business associates that process sensitive data from EU residents must comply with GDPR.
3. Network and IT Security
HIPAA compliance is intrinsically linked with data security. After all, to protect patient confidentiality and keep protected health information safe, it’s vital to have strong cybersecurity. Implementing a GRC framework allows healthcare organizations to target HIPAA compliance objectives and data security best practices simultaneously.
Some aspects of HIPAA that impact network security include:
- Access control and user authentication practices
- Network monitoring
- Data encryption
- Multifactor authentication
- Data loss prevention and information backups
- Regular network vulnerability scans, risk assessments, and security audits
GRC tools help your organization implement effective cybersecurity practices instead of just ticking off boxes on a checklist.
4. Healthcare Risk Management
GRM frameworks offer immense value for risk management programs in hospitals, private clinics, HMOs, and long-term care facilities. Organizations learn to follow a controlled, streamlined, and data-backed approach to risks based on impact and likelihood.
In traditional risk management, each department generally performs its own risk assessments and mitigation actions. This can lead to contradictory or competing stances because priorities for C-suite, IT, HR, legal, and compliance teams are very different. With GRM, departments share data and pursue compliance at an organizational level instead of individually.
5. Business Associate Certifications
It’s not just healthcare companies that receive benefits from a strategic framework. HIPAA business associates, such as SaaS developers, payment processors, cloud computing companies, and IT service providers, depend on having a trustworthy reputation. GRC provides a robust baseline for HIPAA compliance and simplifies the process of obtaining HITRUST, ISO 27001, or SOC 2 Type 2 certification.
6. Scalable Cloud-Based Operations
Telehealth services are increasing among healthcare providers and patients. Experts predict the global telehealth market will increase from nearly $150 billion in 2024 to $850 billion in less than a decade.
Virtual consultations, remote patient monitoring technology, direct-to-home prescription deliveries, mobile health apps, and telehealth appointments for mental healthcare are just some of the ways technology is changing the industry.
Is your organization adequately prepared for potential cybersecurity vulnerabilities and HIPAA violations? GRC risk management adapts as your services grow, with customized controls to remain compliant and secure in the cloud.
7. Supply-Chain Management
Third-party risk management is a major challenge for the healthcare industry, especially because hospitals often have hundreds of different vendors. Third-party business associates can expose networks to immense risk, like the 2022 ransomware attack on a payment provider that impacted Arizona’s Banner Health and other healthcare customers.
GRC frameworks support holistic vendor risk management, network security, and third-party compliance audits. The idea is to identify and prioritize risks while implementing appropriate, reasonable, and cost-effective solutions.
How Can Your Organization Implement a GRC Framework?
The steps you should take for GRC implementation depend on your current program’s maturity. This is one reason many healthcare organizations use a GRC monitoring tool.
First, you need to set framework goals. These can be financial targets, compliance objectives, or cybersecurity improvements, just to name a few.
Next, assess how well your current program meets those objectives. Is your risk program failing to identify vulnerabilities or requiring too many resources? Are human errors disrupting your compliance efforts?
Once you have a baseline, GRC tools help you define the path to your objectives. Then, you can track progress at an organizational, departmental, or personnel level. Implement training programs and correct shortcomings.
GRC is also helpful for creating an intelligent network of roles and responsibilities for compliance and risk management. With process automation, you can ensure document workflows pass through the right individuals for oversight, approval, and continual improvements.
Learn More About GRC for Healthcare Organizations
Tailoring GRC to your healthcare organization helps you overcome current challenges, minimize compliance costs, and maximize efficiency. Instead of following an outdated or ineffective risk program, let Compyl help you implement an adaptive GRC framework that has the right controls for your supply chain, workforce, and operations.
Request a demo to see how Compyl’s flexible GRC solutions can simplify your risk management and HIPAA compliance processes today.
