Regulatory compliance management is a critical aspect of many businesses and industries, including healthcare and finance. In today’s digital world, where business is dependent on storing and sharing sensitive data, technology and regulatory compliance management play a key role in ensuring organizations adhere to specific standards and laws. For organizations that fail to meet compliance standards, the repercussions can be costly.
The Costly Penalties for Noncompliance
Failure to comply with compliance regulations can result in a range of consequences, from operational disruptions to loss of data to legal penalties. Consider the risks, and it’s easy to see why regulatory compliance management is so important.
- Legal action: Penalties for noncompliance can include lawsuits from customers and regulatory authorities. Legal action can be quite costly when you consider the potential damages and legal fees.
- Financial penalties: Noncompliance can also result in fines and penalties. These can be significant, depending on the type of violation and the law broken.
- Brand/reputation damage: Noncompliance can damage an organization’s brand and reputation, which can have long-lasting effects on customer trust and loyalty. (Depending on the size of the breach, some regulatory compliance standards require organizations to notify the public, which can result in irreparable negative publicity.)
Know Your Types of Compliance Frameworks
Compliance requirements are there to protect data and maintain customer privacy. Types of data requiring protection vary, as do the ways data can be captured, shared and stored. Some of the most common compliance frameworks are:
- Health Insurance Portability and Accountability Act (HIPAA)
- HIPAA is a U.S. law regulating personal health information privacy and security. PHI, or Patient Health Information, must be protected at all times. The three major HIPAA rules that apply to technology are:
- Any technology that stores PHI must automatically log out after a certain time to prevent access by someone without credentials.
- Anyone with access to PHI must have a unique login that can be audited based on their use.
- PHI must be encrypted.
- Payment Card Industry Data Security Standard (PCI DSS)
The PCI DSS is a set of security standards that applies to organizations that process credit card transactions. Fortunately, the PCI Security Standards Council maintains a list of tested and approved products and solutions that protect customer payment data and simplify compliance efforts.
- California Consumer Privacy Act (CCPA)
- The CCPA is a comprehensive consumer privacy law that went into effect in 2020. It requires companies to:
- Disclose what personal information they collect about California residents.
- Give California residents the option to opt out of the sale of their personal information.
- General Data Protection Regulation (GDPR)
GDPR is a regulation implemented in the European Union in 2018. It sets strict rules for how companies can collect, use and store personal data. Penalties for noncompliance can result in fines of up to 4% of an organization’s global annual revenue or 20 million euros, whichever is greater.
National Institute of Standards and Technology (NIST) Cybersecurity Framework
The NIST Cybersecurity Framework is a set of guidelines and best practices for organizations to manage and reduce cybersecurity risk. This internationally recognized framework is voluntary and offers standards and guidelines for organizations that want to better manage cybersecurity risk.
Need Help Managing Your Regulatory Compliance Risk?
The penalties for noncompliance can be costly for organizations, large and small. If you need guidance around technology to protect your client data and meet regulatory standards, we can help. Universal Data specializes in healthcare, finance and government industries where meeting compliance requirements is a necessity. Contact us today to schedule a meeting about your regulatory compliance management.