Inaddition to the monetary penalty, the agreement requiresEmblemHealth to implement a corrective action plan and conduct acomprehensive risk assessment. (Photo: Shutterstock).

Health care provider EmblemHealthhas agreed to pay $575,000 to the state of NewYork to settle allegations that it inadvertently disclosed theSocial Security numbers of more than 81,000 people.

SSN printed on envelope

According to the New YorkAttorney General's Office, 81,122 EmblemHealth policyholders,including 55,664 New York residents, were sent a paper mailing witha label that included their Social Security number on it in October2016. Normally, all mailings include a unique mailing identifierthat is printed on the envelope, Attorney General Eric Schneidermansaid in a press release announcing thesettlement.

Related: N.Y. state AG settles with health services companyover delayed data breach notification

An EmblemHealth spokesperson saidin an email, “upon discovery of this issue, we immediately tookaction to identify affected members and put precautionaryprotective measures in place. We are committed to providing thebest service to our customers and have worked closely with theattorney general to enhance our procedures and to give our memberspeace of mind.”

Comprehensive risk assessment ordered

In addition to the monetarypenalty, the agreement requires EmblemHealth to implement acorrective action plan and conduct a comprehensive riskassessment.

“The careless handling of SocialSecurity numbers is never acceptable,” Schneiderman said inthe statement. “New Yorkers need tobe able to trust that companies entrusted with their privateinformation will guard it appropriately. This starts with goodgovernance — which is why my office will continue to push forstronger security laws and hold businesses accountable forprotecting their customers' personal data.”

Related: The role of automation in datasecurity

It's not the first time in recentyears that Schneiderman has reached a settlement withthe New York City-basedhealth care provider that has 3.4 million members.

In 2014, EmblemHealth paid $1.2 million to settleallegations that the company's subcontractor issued 64 percent moredenials of coverage for behavioral and substance abuse issues thanit did in medical cases, allegedly in violation of New York's 2006mental health parity law.

Kristen Rasmussen ([email protected]) is anAtlanta-based reporter for our sister publication, New York LawJournal, who covers health care, corporate legal departments andin-house attorneys.