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NEW YORK--The feared loss of private information on 75,000 members of New York state's largest health insurer was averted Wednesday when a missing compact disc containing the data was found among several packages delivered to an unsuspecting homeowner.
The incident occurred because a mental health care claims administrator and a data management firm for New York-based insurer Empire Blue Cross Blue Shield did not follow the insurer's data transfer protocols, according to a spokeswoman for Empire, a subsidiary of Indianapolis, Ind.-based WellPoint Inc.
Empire already had begun notifying the affected members that their records had been lost. The records contain, among other things, the members' Social Security numbers and a description of the medical services they had received since 2003.
The incident began in Chicago at data management firm Health Data Management Solutions. HDMS shipped the unecrypted disc via UPS to Magellan Health Services Inc. in Philadelphia. The disc, however, ended up among several boxes of stereo equipment delivered to a homeowner in the Philadelphia area, according to a Magellan spokeswoman.
"When the homeowners got around to opening their boxes, they opened the package that contained the CD, they realized that it was not meant to be delivered to them and called Magellan," the Magellan spokeswoman said. "We sent two members of our security staff to retrieve the CD and interview the homeowners. Based on our investigation, we are comfortable that there was no inappropriate access to the information on the CD."
"We are relieved the CD has been found," a WellPoint spokeswoman said. "The information was not transferred in accordance to our contractual terms with Magellan, who did not require HDMS to encrypt or password-protect the data. We are addressing these issues, and we have made it clear to both HDMS and Magellan that their security practices with respect to the data transfer were unacceptable. As a result, Magellan will now only transmit personal health information electronically through a secure network, eliminating CDs and the use of a delivery service."