HIPAA Third-Party Risk Assessment Examples: Common Findings and How to Remediate

Working with vendors that touch Protected Health Information (PHI) introduces measurable risk. This guide walks through HIPAA third-party risk assessment examples, highlighting common findings and clear remediation steps so you can strengthen controls without slowing your operations.

Vendor Due Diligence Evaluation

Example findings

• Security questionnaires returned incomplete or with contradictory answers.
• No recent independent assessments (e.g., SOC report) or Vendor Compliance Audits to validate controls.
• Unclear PHI data flows, including subcontractors that may handle PHI without visibility.
• Cyber insurance gaps or exclusions for privacy incidents.

How to remediate

• Tier vendors by PHI exposure and criticality; require deeper evidence for higher tiers.
• Use a standardized questionnaire and evidence library (policies, network diagrams, pen test summaries).
• Mandate timely corrective action plans (CAPs) and verify closure with follow-up Vendor Compliance Audits.
• Document PHI data flows end-to-end, including subcontractors, before contract execution.

Business Associate Agreement Management

Example findings

• Missing or expired Business Associate Agreement (BAA) before PHI sharing.
• BAAs that omit breach notification timelines or subcontractor flow-down obligations.
• Inconsistent termination terms for return or destruction of PHI.

How to remediate

• Maintain a centralized BAA inventory with renewal alerts and version control.
• Adopt a vetted BAA template covering permitted uses, minimum necessary, subcontractor management, and audit rights.
• Link BAA obligations to vendor onboarding/offboarding checklists to ensure PHI disposition is verified.

Vendor Security Monitoring

Example findings

• No defined cadence for vulnerability scans, patching, or penetration tests.
• Gaps in logging and alerting for systems hosting PHI; limited visibility into vendor incidents.
• Outdated hardening standards or misconfigurations in cloud services.

How to remediate

• Require documented monitoring procedures and monthly or quarterly security metrics from vendors.
• Establish event-sharing protocols for suspected or confirmed security incidents affecting PHI.
• Set baselines for configuration hardening and verify via evidence (scan results, change tickets, patch reports).

Limiting Access to PHI

Example findings

• Excessive privileges; shared or generic accounts used in production.
• Inactive accounts not deprovisioned promptly after role changes or terminations.
• Overly broad API tokens and unsegmented data repositories with mixed PHI and non-PHI.

How to remediate

• Implement Least Privilege Access with role-based access control and just-in-time elevation for sensitive tasks.
• Enforce quarterly access reviews and immediate deprovisioning via automated identity governance.
• Segment PHI stores, scope tokens narrowly, and enable per-object logging for access transparency.

Implementing Multi-Factor Authentication

Example findings

• MFA not enforced for administrative portals, VPN, or third-party dashboards with PHI access.
• Legacy SMS-only MFA and susceptibility to push fatigue or phishing attacks.

How to remediate

• Require Multi-Factor Authentication (MFA) for all privileged and remote access, including support accounts.
• Prefer phishing-resistant factors (FIDO2/WebAuthn, security keys) and number-matching for push approvals.
• Apply conditional access policies and step-up MFA for high-risk scenarios.

Incident Response Collaboration

Example findings

• No vendor Incident Response Plan aligned to your notification timelines and evidence handling needs.
• Ambiguous contacts and decision rights during joint investigations.
• Lack of exercises to validate cross-organization coordination.

How to remediate

• Create a joint playbook with contact trees, RACI roles, data preservation steps, and breach notification triggers.
• Set SLAs for initial notice, status updates, and root-cause reporting; test them in tabletop exercises.
• Require post-incident CAPs with specific owners, due dates, and verification of control improvements.

Encryption Protocols for PHI

Example findings

• Unencrypted PHI at rest in databases, backups, or removable media.
• Weak TLS configurations, legacy ciphers, or missing email transport encryption.
• Poor key management: shared keys, no rotation, or inadequate segregation of duties.

How to remediate

• Adopt clear Data Encryption Standards: AES-256 or equivalent at rest; TLS 1.2+ in transit with modern cipher suites.
• Use managed KMS/HSM where feasible, enforce key rotation, and log all key operations.
• Encrypt backups, mobile devices, and exported reports; use secure messaging for PHI rather than email where possible.

Regular Risk Assessment Procedures

Example findings

• Risk assessments performed only at onboarding, not updated for system or scope changes.
• Inconsistent scoring and missing alignment to business impact and PHI volume.
• Limited documentation of residual risk and acceptance decisions.

How to remediate

• Establish a documented methodology and schedule: onboarding, annually for moderate-risk, and semiannually for high-risk vendors.
• Score risks with defined likelihood/impact scales and consider PHI sensitivity and regulatory exposure.
• Record mitigation plans and formal risk acceptance with executive sign-off and review dates.

Documentation and Reporting Practices

Example findings

• Scattered evidence, outdated policies, and no single source of truth for vendor risk.
• Insufficient audit trails for approvals, exceptions, and CAP verification.

How to remediate

• Centralize artifacts: questionnaires, BAAs, CAPs, scan reports, and meeting notes in a governed repository.
• Produce concise dashboards for leadership covering risk tiers, open issues, and SLA performance.
• Define retention timelines and naming conventions to streamline Vendor Compliance Audits.

Continuous Vendor Risk Monitoring

Example findings

• One-time due diligence with no ongoing alerts for security events or posture changes.
• No monitoring for public disclosures, credential exposures, or domain misconfigurations.
• Missed triggers such as new subcontractors, product changes, or geographic data transfers.

How to remediate

• Implement continuous control monitoring and automated reminders for evidence updates.
• Track threat intelligence, breach reports, and service health changes; escalate per defined thresholds.
• Require notice of material changes and re-assess risk when scope, architecture, or PHI volume shifts.

Conclusion

Effective HIPAA third-party risk management blends rigorous onboarding, enforceable BAAs, strong technical controls, and continuous oversight. By addressing the common findings above with clear remediation steps, you reduce PHI exposure, improve response readiness, and demonstrate due diligence across your vendor ecosystem.

FAQs.

What are common findings in HIPAA third-party risk assessments?

Typical findings include missing or weak BAAs, excessive access to PHI, absent or outdated MFA, inadequate logging and monitoring, encryption gaps, incomplete risk assessments, and poor documentation of CAPs. You may also see unclear data flows, subcontractor blind spots, and slow or undefined breach notification practices.

How can organizations remediate vendor compliance issues?

Start with risk tiering, then require targeted CAPs with owners and due dates. Strengthen BAAs, enforce Least Privilege Access and MFA, adopt clear Data Encryption Standards, and align Incident Response Plan expectations. Verify progress with evidence-based reviews and recurring Vendor Compliance Audits.

What is the role of Business Associate Agreements in HIPAA compliance?

BAAs define how a vendor may use and protect PHI, require safeguards, set breach notification timelines, and ensure subcontractors follow the same terms. They create enforceable obligations, provide audit rights, and clarify PHI return or destruction at contract end, forming the backbone of compliant vendor relationships.

How often should third-party risk assessments be conducted?

Assess at onboarding and at least annually for moderate-risk vendors. For high-risk or high-PHI-volume vendors, conduct reviews semiannually or after material changes, incidents, or scope expansions. Update assessments whenever architecture, subcontractors, or data flows materially change.