$20 Million Dollar Aetna Lawsuit Reminds us of the Need for Meticulous Mail Handling in the Healthcare Industry
By: Frank Farnacci, Executive Vice President
Aetna has begun legal action to claim compensation from an undisclosed administrative support firm in regards to a data breach that happened in the summer of 2017. The privacy of as many as 12,000 people insured by Aetna was compromised as details of HIV medications were visible through transparent plastic windows of envelopes in a mail shot. Letters inserted in some of the envelopes had moved, meaning that the wording “when filling prescriptions for HIV medications” could be seen by anyone who held the envelopes.
What you need to know:
- A federal class-action lawsuit was filed against health insurer Aetna for violating the privacy of 12,000 patients being treated for HIV
- Patients’ personal and HIV-related information was made visible through a large, clear windows on the front of the unopened envelope
- Aetna was accused of violating federal and state privacy laws, including the Health Insurance Portability and Accountability Act (HIPAA)
- Aetna agrees to pay $17 million In HIV privacy breach
- Aetna seeks at least $20 million in damages from the administrative support firm – Kurtzman Carson Consultants (KCC) – whose mistake lead to in the privacy breach
What Aetna says:
- The legal costs associated with the privacy breach are escalating and Aetna does not feel it should have to cover costs arising from the (alleged) negligence of a third-party
- In the legal action, Aetna argues the firm’s mistakes and omissions amounted to gross negligence and that KCC should have been conscious that HIV medication information was detailed under the names and addresses of its plan subscribers
Aetna argues:
- No reviews were carried out to determine how much information was visible through the transparent windows of the envelopes
- KCC did not interact with Aetna to tell them that the envelopes with clear plastic windows were being used for the correspondence, and that Aetna’s lawyers were not spoken with to provide their approval of the mailing
- Aetna did try to resolve their issues directly with KCC and pursued indemnification; however, the talks were not successful leading Aetna to begin legal action
Results:
- Aetna is looking for a ‘hold harmless’ ruling which will see the Aetna safeguarded from all liability, damages, payments and claims with regard to the mailing
- Along with seeking compensation, Aetna is also attempting to get KCC to return or destroy all confidential data provided to permit the firm to complete mailing
- KCC refutes the claims and its general counsel, Drake Foster, referred to Aetna’s claims are ‘demonstrably false’
“This suit reminds us that an underperforming mail services supplier can significantly expose its clients. Mail communications is still a critical aspect of 'B to C' communications especially in the Healthcare industry,” says Frank Farnacci, Executive Vice President, The Millennium Group.