Court Rules
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SettlementHigh RiskMultistate

NJ AG Settles with EyeMed Vision Care for $2.5M Over HIPAA Breach

EyeMed Vision CareMay 16, 2023New Jersey Attorney General

Penalty Amount

$2,500,000

Consumers Affected

2,100,000

Summary

EyeMed Vision Care suffered a data breach in June 2020 due to poor security practices, including shared passwords, exposing personal and medical information of approximately 2.1 million individuals. The multistate settlement imposes a $2.5 million penalty and requires EyeMed to implement enhanced security measures and comply with privacy laws.

Remedy

EyeMed must comply with state and federal privacy laws, maintain a written Information Security Program, employ a responsible officer, report data breaches immediately, and implement appropriate access controls for sensitive information.

Consent DecreeCompliance ProgramReporting Requirements

Contract Impact

In-house legal teams should review all vendor and business associate agreements where the vendor handles protected health information (PHI) or personal data. Specifically scrutinize clauses related to data security standards (e.g., encryption, access controls, password management), breach notification obligations, HIPAA compliance warranties, and audit rights. Given the settlement's focus on password sharing and deficient security, contracts must mandate specific, enforceable security controls like MFA and prohibit credential sharing. Teams should also verify that Business Associate Agreements (BAAs) under HIPAA and Data Processing Addendums (DPAs) under state laws contain up-to-date security requirements and clearly allocate liability for breaches resulting from vendor negligence.

Contract Search Terms

password policyaccess controlsencryption requirementsbusiness associate agreement (BAA)data processing addendum (DPA)breach notification clausedata retention schedulesecurity incident responseHIPAA compliancemultifactor authentication (MFA)

Laws Cited

state Consumer Protection Actsstate Personal Information Protection ActsHealth Insurance Portability and Accountability Act (HIPAA)

Violation Types

Entity Details

Entity

EyeMed Vision Care

Industry

Healthcare

Multistate Coalition

OregonFloridaPennsylvania

Official Sources

Source Evidence

Entity Name
"EyeMed Vision Care"
Fine Amount
"$2.5-million settlement"
Laws Cited
"state Consumer Protection Acts"
Laws Cited
"state Personal Information Protection Acts"
Laws Cited
"federal Health Insurance Portability and Accountability Act (“HIPAA”)"
Violation Types
"deficiencies in EyeMed’s data security program that contributed to the breach in violation of state consumer protection and personal information protection laws and the federal Health Insurance Portability and Accountability Act (“HIPAA”)"

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