Companies in the credit and collection industry need look no further than the ongoing saga at American Medical Collection Agency to know that a data breach can cause irreversible damage to a company, but just to drive home the fact, a recently released report reveals the average cost of a healthcare data breach is $6.5 million, about 60% higher than other industries.
AMCA has said it has spent nearly $4 million so far just sending out notifications to affected individuals whose information was compromised in the breach. The agency says it has also spent $400,000 on outside security experts. But those costs are expected to continue rising.
Breaking it down, a company can expect to spend about $150 per record that is stolen or compromised, according to the report. But in the healthcare industry, the average cost is $429 per stolen record, up from $408 a year ago. The average cost of a data breach in the United States is $8.2 million, more than double the worldwide average.
Malicious data breaches are the most common and the most expensive type of data breach, according to the report.
On average, it takes an organization 279 days to identify and contain a breach. And one-third of the costs associated with a data breach occur in the second and third years after the breach has occurred, exacerbating the long-tail effects of an incident.
“Cybercrime represents big money for cybercriminals, and unfortunately that equates to significant losses for businesses,” Wendi Whitmore, Global Lead for IBM X-Force Incident Response and Intelligence Services, said in a statement. “With organizations facing the loss or theft of over 11.7 billion records in the past 3 years alone, companies need to be aware of the full financial impact that a data breach can have on their bottom line – and focus on how they can reduce these costs.”
