Aetna will pay $17M to settle HIV privacy breach lawsuit

justice scales and gavel
Aetna has opted to settle a lawsuit brought by people who claim the insurer violated their privacy by sending mailings that revealed their HIV status. (Getty/BrianAJackson)

Aetna has agreed to pay $17 million to settle a class-action lawsuit filed by people whose HIV status was revealed in a mailing from the insurer.

The breach, which came to light in August, occurred when Aetna sent letters to about 12,000 individuals that contained instructions for filling HIV medication prescriptions. In some cases, that information was visible through a clear opening in the envelope—causing members’ family members, roommates and neighbors to learn of their HIV status.

At the time, Aetna apologized for the breach and said it was taking steps to prevent such disclosures going forward. It also worked with the AIDS Law Project of Pennsylvania and the Legal Action Center to reimburse those who claimed financial hardship due to the breach, as well as offer counseling services for affected individuals and their families.

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Still, it was quickly hit with a class-action suit filed by a Southeastern Pennsylvania man who says his sister saw the letter from Aetna and discovered he was taking medications to prevent acquiring HIV. The proposed settlement (PDF) reached this week seeks to close that case, with Aetna agreeing to pay $17,161,200 into a fund that will be disbursed to the plaintiffs. The settlement will require court approval to take effect.

Plaintiffs who got letters that disclosed their HIV status will automatically receive a minimum base payment of $500, while those who alleged that Aetna improperly shared their protected health information with its legal counsel and a settlement administrator will receive $75.

Those who claim to have suffered either financial or nonfinancial harm due to the mailings can file for additional damages. As part of the settlement, Aetna will also implement a new “best practices” policy to prevent similar incidents from occurring in the future.

In a press release issued on Wednesday by the Legal Action Center, the lead plaintiff said he was satisfied by the settlement with Aetna.

“HIV still has a negative stigma associated with it, and I am pleased that this encouraging agreement with Aetna shows that HIV-related information warrants special care,” he said. The man filed the suit under the pseudonym "Andrew Beckett," which was the name of the fictional lawyer with HIV portrayed by Tom Hanks in the 1993 movie "Philadelphia."

Aetna was facing a separate lawsuit in connection with the privacy breach, but the plaintiff—an unidentified man from California—dropped (PDF) that case in December.

The insurer is not the only healthcare company to come under scrutiny for its mailings. In September, CVS Health revealed that letters it sent to 4,000 members of Ohio’s HIV Drug Assistance Program accidentally made a reference to HIV visible through a window in the envelope.

Editor's note: This article has been updated to add additional details.