Cost of data breaches in healthcare increased while other industries see 10% drop

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 - Data Breach

Data breaches cost healthcare organizations an average of $380 per record, more than any other industry included in the 2017 Cost of Data Breach study from IBM Security and the Ponemon Institute.

The cost per lost or stolen record in healthcare has continued to increase, up $25 from $355 per record in the 2016 report. The cost across all industries, however, was down 10 percent, with the global average cost of a breach falling to $3.62 million from $4 million. In the U.S, the average cost across all industries rose from $221 to $225 per record, with the average total cost increasing from $7.01 million to $7.35 million.

A notable finding from the report, now in its 12th year, was data breaches caused more businesses to lose customers over the past year. Healthcare was identified as one of the industry most vulnerable to this effect, with a 5.5 percent “abnormal churn rate,” defined as a greater than expected loss in customers after a breach has occurred. That lost business makes up around 41 percent of the breach’s cost.

An effective strategy to keep customers is to have a C-suite level leader like a chief privacy officer or chief information security officer who can “direct initiatives that improve customers’ trust in how the organization safeguards their personal information.” Across all industries, having some sort of incident response team reduced the cost of a breach by $19 per stolen or lost record.