N.D. Commissioner Says Humana Must Cover Losses in Drug Application Theft

Humana Inc. will have to make good on any financial losses suffered by North Dakota customers whose Medicare prescription drug applications were stolen, Insurance Commissioner Jim Poolman said.
Poolman said he learned of the incident this week, even though it was reported to police on May 5. Poolman said he may fine the company because of the theft and its slowness in reporting it to him.

Applications filled out by 268 customers, including 222 from Minnesota and 44 from North Dakota, were in a briefcase stolen from an insurance agent’s unlocked car, which was parked near her home in Brooklyn Park, Minn., last month, according to police and James Theiss, Humana’s chief privacy officer.

The applications included Social Security numbers and bank routing information that Poolman said would be useful to identity thieves, who use personal data to obtain credit cards and loans in their victims’ names.

Theiss said attempts to call affected customers began May 17, and a letter was sent May 19. Theiss said victims have been told they could enroll in a credit-monitoring service at company expense.

“We understand the gravity of this situation, and sincerely apologize for the error on our part of not notifying your department,” Theiss said in a letter to Poolman on Friday. “We are working to prevent errors such as these in the future.”

The agent whose car was broken into works for GoldenCare USA Inc. of Plymouth, Minn., which sells Humana policies under contract. Humana, based in Louisville, Ky., is one of the nation’s biggest providers of Medicare prescription drug plans.

Theiss, in his letter to Poolman, said GoldenCare employees attended “educational sessions” on safeguarding personal information three days after the theft.

Separately on Friday, the federal Center for Medicare & Medicaid Services disclosed that a Humana employee left personal data on 17,000 customers vulnerable to theft by calling it up on a Baltimore hotel computer and leaving it there.

The file, which was a listing of Medicare prescription drug benefit customers, included Social Security numbers and other information.

CMS spokesman Peter Ashkenaz said there was no evidence the
information was misused. However, Humana was ordered to notify the
affected customers, and make a credit monitoring service available
to them at no cost.