State Regulators Investigate Health Net Security Breach

The California Department Insurance and the California Department of Managed Care are conducting their own investigation into Health Net’s loss of several server drives that contained enrollee and employee information. The state insurance department’s independent follow-up investigation would determine whether the health insurer did everything it could have to avoid and remedy the security breach. The other regulator’s investigation would also look into the insurer’s security practices. Insurance Commissioner Dave Jones requested that Health Net forward the findings of its own investigation on the breach to his department. The request comes after Health Net announced yesterday that the server drives were unaccounted for at its data center in Rancho Cordova, Calif. Health Net was informed of the missing drives by IBM, the vendor that handles the insurance company’s information technology infrastructure. The drives include personal information of 1.9 million former and current enrollees nationwide, according to the California Department of managed Care. The drives also include information of employees and health care providers. The information possibly includes details such as names and addresses, health and financial information and social security numbers. “I have been in constant contact with Health Net on this matter, and I am pleased to see that the company is following protocol by notifying all the individuals affected by this privacy breach,” Jones said. “With identify theft crimes on the rise, it is more important than ever to act immediately and comprehensively in addressing a privacy breach.” Health Net is offering affected individuals two years of free credit monitoring services, the restoration of credit files and identify theft insurance. Jones has advised policyholders impacted by the loss of the drives to contact the California Department of Insurance. Jessica Vernabe