As society becomes ever more reliant on technology, and globalization expands the supply chain, cyberattacks involving third-party service providers are on the rise.
Some of the most high-profile cyberattacks of 2019 involved a third-party service provider. On May 31, 2019, the American Medical Collection Agency (AMCA) – a billing services provider – suffered a data breach that compromised the sensitive data of nearly 20 million patients. The hacked server impacted approximately 11.9 million patients of Quest Diagnostics and 7.7 million patients of LabCorp. Quest, LabCorp and AMCA were all named in class action lawsuits, with plaintiffs alleging unreasonable breach notification delays, a lack of reasonable data security and possible violations of the Health Insurance Portability and Accountability Act (HIPAA). Just two weeks after announcing the data breach, the AMCA’s parent company declared bankruptcy, citing a “cascade of events” leading to “enormous expenses that were beyond the ability for the debtor to bear”.
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