New Legislation Proposed to Aid Providers Affected by Cyberattacks 

by | Apr 1, 2024 | Healthcare Industry News

This week, Senator Mark R. Warner (D-VA) introduced the Health Care Cybersecurity Improvements Act of 2024, a legislative initiative aimed at providing advance and accelerated payments to healthcare providers grappling with the aftermath of cyberattacks. The legislation comes in response to the recent ransomware attack on Change Healthcare, which resulted in a prolonged outage lasting over four weeks. During this time, physicians and hospitals nationwide encountered major operational disruptions, including the inability to process claims, bill patients, and verify insurance coverage. The proposed legislation seeks to address the financial strains imposed on healthcare providers by cyber incidents, such as the Change Healthcare ransomware attack. Senator Warner, a member of the Senate Finance Committee and co-chair of the Senate Cybersecurity Caucus, has long been an advocate for prioritizing cybersecurity in healthcare. Drawing on his previous efforts, including a 2022 white paper framing cybersecurity as a crucial patient safety issue, Senator Warner emphasizes the urgent need to strengthen cybersecurity measures across the healthcare sector.   

Under the Health Care Cybersecurity Improvements Act of 2024, healthcare providers would not only be eligible but encouraged to apply for advance and accelerated payments in the event of a cyber incident that disrupts their operations. These payments are designed to alleviate the financial strain caused by such incidents. However, to qualify for these payments, providers and their associated vendors must meet stringent minimum cybersecurity standards. While the specific details outlining these standards were not initially provided, the responsibility of defining and implementing them rests squarely on the shoulders of the HHS Secretary. This mandate emphasizes the importance of robust cybersecurity practices within the healthcare industry and incentivizes providers to prioritize the protection of sensitive patient data and key infrastructure. The legislation also seeks to directly address the cash flow challenges often experienced by Medicare Part A and Part B participants during cyber incidents. To achieve this goal, the proposed legislation introduces modifications to the existing Medicare Hospital Accelerated Payment Program and the Medicare Part B Advance Payment Program. These modifications aim to streamline the process for healthcare providers affected by cyber incidents to access expedited payments. However, access to these payments is contingent upon meeting the prescribed cybersecurity standards established by the HHS Secretary. By linking financial assistance to cybersecurity compliance, the legislation not only safeguards the integrity of healthcare data but also incentivizes proactive cybersecurity measures across the industry.  

The Health Care Cybersecurity Improvements Act of 2024 includes robust provisions to ensure accountability and promote compliance. In the event of enactment, the legislation would grant the HHS Secretary the authority to determine the eligibility of payment requests stemming from cyber incidents. Healthcare providers seeking accelerated payments must undergo rigorous scrutiny to demonstrate their adherence to the minimum cybersecurity standards established by the Secretary. The proposed legislation also incorporates a two-year transition period from enactment to implementation. This grace period allows healthcare organizations enough time to align with the mandated cybersecurity requirements, implement necessary adjustments to their systems and protocols, and adequately prepare for the potential occurrence of future cyber incidents. 

The Health Care Cybersecurity Improvements Act of 2024 represents a proactive step towards strengthening the financial resilience of healthcare providers in the face of increasing cyber threats. The legislation aims to mitigate the adverse impacts of cyber incidents on patient care and financial stability within the healthcare sector by providing a framework for advance and accelerated payments contingent on cybersecurity compliance. 

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