Feds Slam Rite Aid For Carelessness
Chain pays $1 million for privacy breaches
July 29, 2010
Rite Aid Corp. and its 40 related entities have agreed to pay $1 million to settle potential violations of federal health privacy rules after some of the chain’s employees were videotaped throwing prescriptions and pill bottles in easily accessible store trash containers.
The U.S. Department of Health and Human Services and the Federal Trade Commission began an investigation after a television news team videotaped incidents in which Rite Aid employees threw out pill bottles with individuals’ health information on the labels in public dumpsters, according to the FTC. News reports also indicated Rite Aid pharmacies used open dumpsters to discard trash that contained consumers’ personal information, such as pharmacy labels and job applications.
“Companies that say they will protect personal information shouldn’t be tossing patient prescriptions and employment applications in an open dumpster,” said Jon Leibowitz, chairman of the Federal Trade Commission. “We hope other organizations will learn from the FTC’s action against Rite Aid to take their obligation to protect consumers’ personal information seriously.”
As part of the settlement, Rite Aid and its 4,800 pharmacies will establish policies and employee training policies on how to protect sensitive information and obtain independent assessments of pharmacy compliance with the federal health privacy rules.
In a report on the Government Health IT Web site, Rite Aid spokeswoman Cheryl Slavinsky said: “We take this very seriously. We are not aware of any harm to customers or patients from the investigated incidents, and we certainly hope that it does not happen again.”
Rite Aid operates the third largest pharmacy chain in the United States. This is the second case in which the FTC and HHS coordinated their investigations and settlements. The agencies resolved similar allegations with CVS Caremark in February 2009.
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