Aetna is fined by New York for leaking members' HIV status

NEW YORK (Reuters) - Aetna Inc will pay a $1.15 million civil fine and improve its privacy practices to settle charges that it leaked the HIV-positive status of 2,460 New York members in a mailing where it used envelopes with large transparent windows.

New York Attorney General Eric Schneiderman on Tuesday said names, addresses, claim numbers and HIV medication instructions in the July 28, 2017 mailing were "clearly visible" to outsiders because of how Aetna folded letters and inserted them into the envelopes.

The mailing was intended to notify members of a class action settlement permitting them to buy HIV medication at brick-and-mortar pharmacies rather than by mail, where their privacy might be compromised if neighbors or family saw the drug packages.

While about 1 million Americans live with HIV or AIDS, the associated stigma can lead to a denial of proper healthcare, discrimination and other negative consequences, according to settlement papers signed by Aetna and Schneiderman's office.

"Through its own carelessness, Aetna blatantly violated its promise to safeguard members' private health information," the attorney general said in a statement.

Schneiderman said his office uncovered similar issues with a Sept. 25, 2017 mailing by Aetna to 163 New York members with atrial fibrillation, an irregular heartbeat condition.

The Hartford, Connecticut-based company did not admit or deny wrongdoing, and agreed to retain an independent consultant for two years to monitor its efforts to improve member privacy.

It agreed last week to a $17.2 million settlement in the federal court in Philadelphia of private litigation over similar claims by more than 11,000 members in New York and other states.

"We have worked to address the potential impact to members following this unfortunate incident," Aetna said in a statement. "We are implementing measures designed to ensure something like this does not happen again as part of our commitment to best practices in protecting sensitive health information."

Aetna agreed last month to be bought by CVS Health Corp in a $69 billion transaction.

HIV is short for human immunodeficiency virus, and AIDS for Acquired Immunodeficiency Syndrome.

(Reporting by Jonathan Stempel in New York; Additional reporting by Nate Raymond in Boston; Editing by Tom Brown)