Anthem Blue Cross Data Breach May Affect 230,000 Applicants

Anthem Blue Cross has alerted an estimated 230,000 applicants for coverage that their personal medical records and Social Security numbers may have been wrongfully accessed in a data breach.

The company, a wholly owned subsidiary of WellPoint Inc., said in a statement the breach was linked to a systems upgrade completed last October. The insurer stated that a third-party security vendor certified that all proper privacy safeguards were in place. In fact, they weren't, Anthem claimed.

The snafu allowed "a small number of individuals" to manipulate Anthem's applicant web page "for a relatively short period of time" and gain "unauthorized access to certain private information."

Efforts to reach various Anthem officials for further details were not immediately successful.

The "vast majority" of the unauthorized accesses "occurred at the hands of certain attorneys…to support a class action against Anthem" concerning the breach, the statement said.

The pool of affected applicants — comprised of persons under 65 who were applying for individual policies — will be offered identity protection services for one year at no cost, Anthem stated.

Anthem's breach is the latest in a series of insurance-related security lapses that have exposed private information and medical records to potential jeopardy. Last October, someone stole 57 audio and video discs from a customer service storage area in Chattanooga controlled by BlueCross BlueShield of Tennessee. According to the American Medical Association, authorities estimate as many as one million individuals' records may have been compromised in the theft (BestWire, Jan 14, 2010).

Then in January, AvMed, a Florida-based nonprofit health maintenance organization and commercial insurer, disclosed on its website that two laptops with some 200,000 personal records, including names, addresses, Social Security numbers and health information, had vanished in December 2009 from its Gainesville home office.

Anthem Blue Cross is the trade name of Blue Cross of California. Its parent, WellPoint, an Indiana-domiciled company, is one of the largest U.S. health benefits company serving over 33 million members, according to A.M. Best's BestLink, which provides online access to A.M. Best's Global Insurance & Banking Database.

Anthem Blue Cross Life and Health Insurance Co. currently has a Best's Financial Strength Rating of A (Excellent).

Shares of WellPoint (NYSE:WLP) closed at $50.86 on June 28, down 1.72% from their previous close.

(Dennis Gorski, Best's Review managing editor)