CalOptima says data on 68,000 members may be compromised

Computerworld - Personally identifiable information on about 68,000 members of CalOptima, a Medicaid managed care plan serving Orange County, Calif., may have been compromised after several CDs containing the information went missing earlier this month.

The unencrypted data on the CDs includes member names, home addresses, dates of birth, medical procedure codes, diagnosis codes and member ID numbers, and an unspecified number of Social Security numbers.

The discs had been put in a box and sent via certified mail to CalOptima by one of its claims-scanning vendors, according to a statement by the health plan. CalOptima received the external packaging material minus the box of discs, the statement said.

A CalOptima spokesman today said it's not clear how the box went missing, but added that there is no evidence to suggest that it was stolen.

"As of today, the missing disks have still not been found," the spokesman said. CalOptima plans to offer credit monitoring services for all those affected by the breach. The organization is now negotiating an agreement with one of the three major credit monitoring bureaus, he said. Once that's done, CalOptima will begin sending out notification letters to those affected, the spokesman said.

The health plan also wants to find out why the third-party claims-scanning vendor did not encrypt the data, he said.

The loss of the discs comes amid heightened concerns about data breaches involving health care information. Last month, a new law went into effect that requires all healthcare organizations and providers to publicly disclose any data compromises involving protected health information.

The law is part of the $20 billion Health Information Technology for Economic and Clinical Health Act (HITECH) passed by Congress earlier this year. Companies that use encryption and data destruction methodologies to render sensitive health information unusable and unreadable to unauthorized individuals are exempt from the notification requirement.

In CalOptima's case, the organization would have been required to publicly disclose the breach even without the new law, because the compromised information included Social Security numbers. But until the health care breach notification law went into effect last month, organizations such as CalOptima would not have been obliged to disclose any breach involving the potential loss or compromise of protected health information.