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Nearly a quarter million confidential Medicare and Medicaid records were improperly released to a private email address by an employee at the S.C. Department of Health and Human Services (SCDHHS) – the latest in a string of cabinet embarrassments for the administration of S.C. Gov. Nikki Haley.

The incident – believed to be the most serious security breach in the agency’s history – has not only violated the privacy of tens of thousands of South Carolinians, it has also exposed them to possible identity theft.

“Last week, the South Carolina Department of Health and Human Services (SCDHHS) discovered that a Medicaid employee inappropriately transferred personal information for 228,435 Medicaid beneficiaries to his personal email account, constituting a violation of agency policy,” officials at the agency said in a statement.  “The department immediately contacted the South Carolina Law Enforcement Division to investigate the incident and also informed other state and federal agencies. The employee was terminated last week.”

Among the data released? Individuals’ names, addresses, birth dates and Medicare and Medicaid numbers. As many as 22,000 of the records contained Social Security information.

“On behalf of the agency and the State of South Carolina, we sincerely apologize for this incident,” the statement adds.


The costs of this security breach are going to be staggering. Not only does SCDHHS have to mail a letter to all 228,435 beneficiaries, it has to pay for a free year of identity theft protection.

As it stands now there are nearly 1 million South Carolinians currently on Medicaid – or one out of every 4.5 people in the state. That total includes 43 percent of the state’s children and 52 percent of all live births – not a promising trend line. Also, beginning in 2014 states must expand Medicaid to cover all non-elderly individuals with family incomes below 138 percent of the federal poverty level. “Obamacare” and its borrowed billions will pay for the first three years of this new mandate , but in 2017 that burden would shift to states.

Already struggling to keep up, Haley gave her agency not one but two $100 million bailouts last year (here and here).