AvMed Health Data Breach Class Action

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UPDATE: The AvMed Data Breach Class Action Settlement was granted preliminary approval on Oct. 25, 2013. Details on how to file a claim to receive a cash award can be found here.

UPDATE 2: The AvMed Data Breach Class Action Settlement was granted final approval on Feb. 28, 2014.

AvMed Health Insurance Company has been hit with a class action lawsuit for allowing millions of its customers’ personal medical data to be exposed to theft. Approximately 1.2 million AvMed Health Plan members are estimated to have had their health records exposed in what is being called one of the largest medical record breaches in history.

The AvMed data breach class action lawsuit is the latest in a series of similar class actions. We’ve been reporting a lot lately on class action lawsuit settlements against companies who have exposed their customers to data theft (see “Heartland Data Breach Settlement,” “Anthem Data Breach Class Action” and “D.A. Davidson & Co. Data Breach Settlement”). Usually the data breaches are a result of hackers using sophisticated means to hack into the company’s system, but with the AvMed Health data breach, it seems it was nothing but good old-fashioned employee stupidity.

On December 11, 2009, two unencrypted laptop computers containing millions of AvMed members’ confidential medical records were left unattended at the insurer’s headquarters and subsequently stolen. The records contained AvMed members’ names, home addresses, phone numbers, Social Security Numbers, as well as other highly sensitive medical history data such as diagnosis information, medical procedure and prescription information.

To make matters worse, the AvMed Health class action lawsuit says, AvMed repeatedly underestimated the gravity of the theft and had to make numerous revisions about the vast quantity of data stolen. Initially AvMed contacted only 280,000 members to warn them of the dangers that accompanied the data loss. However, further investigation found that nearly 1.2 million AvMed Health Plan members’ private health records had been breached. In June, Florida’s Attorney General warned AvMed Health Plan members to monitor their credit statements.

“This is easily one of the largest medical record breaches in history, and the disastrous consequences may plague those affected for their lifetime” said the attorney representing class members in the AvMed data breach lawsuit. “We believe that AvMed did not follow government-mandated HIPPA protocols. Merely taking the time to encrypt their laptops, likely would have obviated any harm done by this theft. It is mind-boggling that such simple procedures were not done to protect AvMed’s customers, who placed their trust in their insurance company to protect their highly personal information.”

We’ll keep you posted as the AvMed Health Data Breach Class Action Lawsuit progresses.