Penalty Amount
$550,000
Consumers Affected
242,641
New York Attorney General Letitia James secured a $550,000 settlement from Hudson Valley health care operator HealthAlliance over a 2023 data breach that compromised the personal and medical information of 242,641 New Yorkers. The breach occurred after HealthAlliance failed to patch a known vulnerability in its web application system, allowing cyberattackers to exfiltrate patient and employee data. As part of the settlement, HealthAlliance must pay the penalty and implement enhanced cybersecurity measures including a comprehensive security program, patch management policy, and data inventory requirements.
HealthAlliance must pay $550,000 in penalties, with $850,000 of a $1.4 million total penalty suspended due to its financial condition and role providing essential care in underserved areas. The entity is required to implement a comprehensive information security program, maintain a data inventory with appropriate encryption, adopt a patch management policy requiring critical vulnerabilities to be patched within 72 hours or neutralized, and implement additional network activity restriction and monitoring measures.
In-house legal teams should review all vendor agreements with healthcare technology providers to ensure they include requirements for timely notification of security vulnerabilities, and that the company's patch management policies are aligned with vendor remediation timelines. Contracts should also mandate that vendors notify the company immediately of any critical vulnerabilities, and that the company has the right to take systems offline if patches cannot be applied within 72 hours. Additionally, teams should update data security clauses to require encryption of all patient and employee data, maintenance of a data inventory, and network monitoring/restriction measures. For healthcare entities, ensure that any settlement or consent decree requirements for information security programs are incorporated into vendor service agreements to avoid future liability.
Entity
HealthAlliance
Industry
HealthcareOfficial Press Release
https://ag.ny.gov/press-release/2024/attorney-general-james-secures-550000-hudson-valley-health-care-facility
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New York Attorney General Enforcement Page
https://ag.ny.gov/press-releases
"secured $550,000 from a Hudson Valley health care facility operator, HealthAlliance"
"HealthAlliance is required to pay $550,000 in penalties"
"HealthAlliance agreed to pay a $1,400,000 penalty, of which $850,000 will be suspended"
"December 9, 2024"
"New York Attorney General Letitia James"
"As a result of today’s agreement"
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