Anthem failed to encrypt data prior to cyber-attack
Encryption, which scrambles data so only authorized parties can read it, is considered the most effective way to achieve data security. Several data experts say the lack of encryption made it easier for hackers to gain access to up to 80 million customer records including Social Security numbers, e-mail addresses and other personal information.
Anthem is the nation’s second-largest health insurer, operating Blue Cross and Blue Shield plans in 14 states. And it was revealed this week that the hackers have stolen millions of records on customers and employees at Anthem. The hackers obtained the names, birthdays, addresses, and social security numbers, though there is no sign that they accessed any medical records.
An Anthem spokeswoman said that the company, like other health insurers, only encrypts customer data when it's transferred in or out of its database, but uses "other measures, including elevated user credentials, to limit access to the data when it is residing in a database." She adds that the government and employers require insurers to use social security numbers as unique identifiers for their customers.
Federal law says health insurers must "address" data encryption in their security protocol, but it's not mandated. For some companies, it comes down to a choice between added security and extra cost, though it's not clear whether encryption alone could have thwarted the attack on Anthem, since it was carried out with stolen employee credentials. The issue isn't exclusive to the healthcare industry, either; Sony Pictures didn't encrypt its data prior to a major cyber attack late last year.
The cyber attack on Anthem Inc. underscores the need for companies to review incident response plans and other measures to ensure they’re ready for the worst, says Patrick Nielsen, a senior security researcher with Kaspersky Lab. “Companies will learn the hard way to take security seriously or do it proactively,” he said.
For highly regulated industries, compliance alone may not be enough. Regulations are “very helpful,” Mr. Nielsen said, “but in a certain way they give a sort of false sense of security.” Instead of checking the compliance box and calling it a day, CIOs can use the Anthem breach as yet another opportunity to increase focus on security at every level of their organizations. To address this, guidance will likely need to come from the CEO, board of directors and others at the top of the corporate totem pole. “It’s definitely one area where there’s a lot to be gained by saying ‘what are all the things we can do to strengthen security here,’ even if they don’t all apply to relevant legislation.”
Think about data retention Nielsen noted that Anthem’s hacked databases included information about some former customers, and wondered why that data was still around. “Once they’re former members, it’s probably not necessary to keep that information around,” he said.
