Anthem CEO faces tough task in wake of breach
Anthem CEO Joseph Swedish (pictured right) has not avoided the spotlight in the week since the insurer announced that hackers compromised personal information for 80 million Anthem customers. He even went so far as to admit publicly that his own info had been hacked.
Swedish's job in the weeks and months ahead nonetheless hinges on what government investigations turn up and on how he reacts to customer concerns, the Los Angeles Times reported. It's not a stretch to say his job is at stake--Gregg Steinhafel lost his job as Target CEO following a data breach affecting 110 million of the retail giant's customers.
"If Anthem was negligent or it's something that could have been avoided, that will not bode well for his tenure as CEO," Ana Gupte, a healthcare analyst at Leerink Partners, told the LA Times. "If he comes out of it well, it's another feather in his cap."
Until last week, the largest test of Swedish's tenure at the nation's second-largest insurer had been improving customer service at Anthem, which ranked last among major health insurers in a recent Forrester Research customer experience report, the LA Times said. Even so, Anthem stock has more than doubled in value since Swedish took the helm March 25, 2013, closing at $142 yesterday. Additionally, Medicaid expansion has helped Anthem add customers, FierceHealthPayer previously reported.
Still, the details of the Anthem hack raise many concerns. The information that hackers obtained--names, birthdates, Social Security numbers, email addresses and medical ID numbers--had not been encrypted. Although employee credentials and not encryption were the main culprit in the Anthem hack, and although HIPAA encourages but does not require encryption, the lack of encryption has federal health officials and state insurance commissioners looking into Anthem's security practices, the LA Times noted.
On top of that, the insurer announced Thursday that hackers had obtained customer data going as far back as 2004, according to a second LA Times article. Identity protection and credit monitoring services will be available to Anthem customers beginning today, the Times said. All told, the data breach is expected to cost Anthem more than $100 million, according to FierceHealthIT.
Anthem faces a long road to recovery, but Swedish remains confident. In an email to the LA Times, he said: "It's my view that how we engage with our members and customers in difficult times truly defines our relationship with them. We will continue to do everything in our power to make our systems and security processes better and more secure. Our primary goal is to earn back their trust and confidence in Anthem."
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