The Impact of Data Breaches on Hospital Insurance Spending

This study investigates whether data breaches lead to measurable changes in hospital insurance expenditures in the U.S. healthcare sector. Using a panel dataset of hospital-year observations from 2017 to 2019, we constructed a binary indicator for data breach exposure and examined its association with reported insurance expenditures. To control for institutional differences, we applied propensity score matching (PSM) and estimated the average treatment effect on treated using a multivariate regression model. Descriptive statistics revealed that breached hospitals were generally larger, more complex, and financially robust institutions. However, after adjusting for observed characteristics, we found no statistically significant association between data breaches and changes in insurance expenditures. This suggests that hospitals may not experience immediate insurance premium increases or may manage breach-related risks through self-insurance strategies such as self-insurance.