Every. Dollar. Matters. That’s a sentiment that rings particularly true in the world of subsidized child care. State agencies and contractors already have a wide range of challenges to consider when it comes to managing subsidies—from staffing shortages to a budget that’s regularly expanding and contracting. Amidst the sea of challenges already facing contractors, security risks can often go overlooked or under-addressed in the process. But even the slightest vulnerability, left unchecked, could invite a breach or attack that wreaks havoc and ultimately spells disaster for an organization.
Whatever the reason—whether it’s an issue of staff’s bandwidth or a lack of resources—failing to prioritize security within the subsidy management process is a risk that today’s child care industry can no longer afford to take. Here are just a few of the security challenges facing contractors and state agencies today.
Third-Party Vendor Security
Do you know where your technology solutions are coming from? How they’re managed? What their security standards are? While third-party vendors play a critical role in helping state agencies and contractors with subsidy management, they can also open your organization up to more risk. Supply chain attacks can be devastating, and in 2022 alone, the number of attacks involving third-party components soared to over 600% according to one report.
An important step in bolstering security is also a simple one—analyze the vendors with an eye toward security. Child care agencies and contractors have vast amounts of highly sensitive data on hand. Before entrusting a third-party organization with that data, your focus should turn toward what that vendor’s security posture is. Ask questions like, have they experienced a breach? Where are they storing my data? How do they stack up to our state’s compliance standards? See more of my thoughts on the topic here.
Third-party risk is a serious threat, but with the right approach—and equally important—the right partner, contractors can build confidence in their subsidy management processes.
Fraud and Human Error
Dealing with limited resources and budgets, every dollar in subsidies needs to be accounted for. But for an agency or contractor that’s still relying on paper and spreadsheets, the margin for error is significantly high, meaning fraud or benign (but still harmful) human error could slip through unnoticed. While it may seem small, a duplicate payment here or an overpayment there can take away vital resources and compromise an organization’s ability to adequately support the children and families they serve.
Building lasting program integrity and effectively spotting fraud requires meaningful digital transformation across an entire agency. At KinderSystems, solutions like IntegrityCentral help organizations achieve that critical level of program integrity to keep data secure and payment information accurate. With KinderSystems’ solutions, you can easily process millions of records to spot anomalies, model data to identify red flags or suspicious activity and harness your data to make more informed decisions.
Keeping Up With Compliance
A strong security posture and prioritizing program integrity aren’t just important steps to protect your organization. They’re a critical piece of helping contractors and agencies keep up with the pace of regulation. Considering the sensitive nature of the data that contractors and agencies keep, breaches and attacks open organizations up to a host of regulatory vulnerabilities. Everything from stringent federal and state guidelines to HIPAA requirements can have an impact on what agencies and contractors need to be aware of. That means a failure to comply, a major breach, or a lapse in security could prove fatal for the organization.
With so much to consider, when a contractor or agency does decide to embark on a transformation journey, it’s not enough to simply turn to the nearest technology offerings. Any partner that enters the fold needs to have a mastery over the unique needs of the state those contractors operate in and provide solutions that are tailor-made for them.
Find out more about how KinderSystems can help your organization stay secure and transform.
