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EyeMed Vision Care Settles Multistate Data Breach Investigation for $2.5 Million

In June 2020, the Luxottica Group PIVA-owned vision insurance company, EyeMed Vision Care, experienced a data breach involving the protected health information (PHI) of 2.1 million patients. An unauthorized individual gained access to an employee email account that contained approximately 6 years of personal and medical information including names, contact information, dates of birth, Social Security numbers, vision insurance account/identification numbers, medical diagnoses and conditions, and treatment information. The unauthorized third party then used the email account to distribute around 2,000 phishing emails.

State attorneys general have the authority to investigate data breaches and can fine organizations for HIPAA violations. A multi-state investigation was launched by state attorneys general in Oregon, New Jersey, and Florida into the EyeMed data breach, and Pennsylvania later joined the multistate action. The state attorneys general sought to establish whether the data breach was preventable and if it was the result of a failure to comply with the HIPAA Security Rule and state data protection laws.

The investigation identified data security failures that violated HIPAA and state laws. Under HIPAA and state data protection laws, entities that collect, maintain, or handle sensitive personal and medical information are required to implement administrative, technical, and physical safeguards to ensure the confidentiality, integrity, and availability of that information, yet those safeguards were found to be lacking at EyeMed. The investigation revealed a failure to ensure all individuals with access to protected health information had a unique login and password. Several EyeMed employees were found to be sharing a single password for an email account that was used to communicate sensitive information, including PHI related to vision benefits enrollment and coverage.

Under the terms of the settlement, EyeMed agreed to pay a financial penalty of $2.5 million which will be shared between Oregon, New Jersey, Florida, and Pennsylvania. The settlement also requires EyeMed to ensure compliance with state consumer protection acts, state personal information protection acts, and HIPAA law, and ensure EyeMed does not misrepresent the extent to which it maintains and protects the privacy, security, or confidentiality of consumer information.

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The data security requirements of the settlement include the development, implementation, and maintenance of a written information security program; maintenance of reasonable policies and procedures governing the collection, use, and retention of patient information; and maintenance of appropriate controls to manage access to all accounts that receive and transmit sensitive information. ”New Jerseyans trusted EyeMed with their vision care and their personal information only to have that trust broken by the company’s poor security measures,” said Attorney General Platkin, who co-led the investigation. “This is more than just a monetary settlement, it’s about changing companies’ behavior to better protect crucial patient data.”

The Office of the New York Attorney General also investigated EyeMed over the data breach and entered into a separate settlement agreement last year, which required EyeMed to pay a $600,000 penalty. In October 2022, a $4.5 million settlement was agreed between EyeMed and the New York Department of Financial Services (NYDFS) to resolve alleged violations of the NYDFS (Part 500) cybersecurity regulations. The security failures included not limiting employee access privileges to email accounts for 9 employees, a partial rollout of multifactor authentication, risk assessment failures, the lack of a sufficient data minimization strategy, and inaccurate submissions of compliance with Part 500 for four years. The settlements with NYDFS and the New York Attorney General also had data security requirements, including the implementation and maintenance of a comprehensive information security program, encryption of data, multi-factor authentication for all administrative and remote access accounts, and penetration testing.

HIPAA compliance investigations by state attorneys general are independent of the HHS’ Office for Civil Rights (OCR), which may also choose to impose civil monetary penalties for HIPAA violations. No penalty has been announced by OCR as of May 2023 and the incident is marked as closed on the OCR breach portal.

Author: Steve Alder is the editor-in-chief of HIPAA Journal. Steve is responsible for editorial policy regarding the topics covered on HIPAA Journal. He is a specialist on healthcare industry legal and regulatory affairs, and has several years of experience writing about HIPAA and other related legal topics. Steve has developed a deep understanding of regulatory issues surrounding the use of information technology in the healthcare industry and has written hundreds of articles on HIPAA-related topics.


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