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State probes Health Net security lapse

March 15, 2011|By Duke Helfand, Los Angeles Times

State regulators have opened an investigation into the security practices of insurer Health Net Inc. after the Woodland Hills company revealed the loss of computerized records containing personal information related to about 1.9 million people.

The California Department of Managed Health Care launched the probe after Health Net disclosed that several of its computer drives were missing. The company said the records included addresses, Social Security numbers and other information of customers, employees and healthcare providers.

"Health Net has agreed to provide two years of free credit monitoring services to its California enrollees, in addition to identity theft insurance, fraud resolution and restoration of credit files, if needed," department spokeswoman Lynne Randolph said.

Health Net said in a statement that it was conducting its own probe of the security breach at its data center in Rancho Cordova, near Sacramento. The company said that IBM Corp., which manages its technology, could not locate the computer drives.

The managed healthcare department, citing Health Net as its source, said that nine drives were missing, with data on 1.9 million current and former members. Health Net said it was notifying affected individuals. The company said customers with questions should visit Health Net's website at http://www.healthnet.com or call (855) 434-8081.

duke.helfand@latimes.com

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