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Labcorp Paying Out $35M in Settlement: Who’s Eligible
0 Share Newsweek is a Trust Project member See more of our trusted coverage when you search. Prefer Newsweek on Google to see more of our trusted coverage when you search. Millions of Americans may be eligible for compensation from a $35 million class action settlement tied to a major healthcare data breach involving Labcorp.
The settlement resolves claims that arose after a cyberattack at American Medical Collection Agency (AMCA)—a third-party billing and collections vendor used by Labcorp—which allegedly exposed sensitive personal and medical information belonging to millions of patients.
Eligible consumers have until September 3 to submit a claim.
Labcorp is one of the largest diagnostic testing companies in the world, performing more than 750 million tests annually and serving patients across the United States and abroad.
Healthcare data breaches have become an increasingly common concern. Medical records often contain highly sensitive information, including Social Security numbers, insurance information and payment details.
According to the settlement, the AMCA breach potentially exposed information belonging to about 7.7 million Labcorp patients.
This theoretically could lead to identity theft and fraud, but the settlement provides both cash compensation and free monitoring services to those affected.
The lawsuit alleges that Labcorp failed to adequately safeguard patient information that was transmitted to AMCA, also known as Retrieval-Masters Creditors Bureau Inc., for billing and collections purposes.
According to court filings, AMCA experienced a cybersecurity incident affecting systems containing personal and health-related information.
“For the patients affected, this extends beyond the initial breach, as stolen medical and personal information can be used for identity theft and even medical identity fraud years after the incident,” Alex Beene, financial literacy instructor for the University of Tennessee at Martin, told Newsweek .
Plaintiffs argued that affected consumers faced an increased risk of identity theft and fraud as a result of the breach. Labcorp denied wrongdoing but agreed to the $35 million settlement to resolve the claims.
"The settlement is not an admission of wrongdoing or an indication that defendant has violated any laws, but rather the resolution of disputed claims," the settlement website said.
Labcorp is one of the largest laboratory service providers in the world. The company says it employs approximately 71,000 people and operates nearly 2,200 patient service centers nationwide.
Globally, Labcorp performs more than 750 million tests for patients each year.
That means the settlement could affect a large number of Americans who have undergone blood work or other diagnostic testing through their doctors or at hospitals.
“This settlement is another reminder that healthcare organizations and their vendors have become prime cybercrime targets, and those caught in the middle of these breaches will have to provide significant financial compensation for those affected,” Beene said.
According to the settlement notice, people may be eligible if:
The deadline to submit a claim is September 3, and claims submitted after that date may not be eligible for compensation.
Eligible consumers can submit a claim through the official settlement website .
If you received a notification that your information was involved in the AMCA breach, or you had a Labcorp account handled by AMCA during the affected period, it may be worth checking your eligibility before the September deadline.
Because many consumers discard breach notices and forget about older cybersecurity incidents, settlements like this often go unclaimed by large numbers of eligible people.
Eligible class members may choose between the following options:
However, the actual cash payment amount could be higher or lower depending on the number of valid claims submitted.
A final approval hearing is scheduled for August 20. Settlement payments generally are not distributed until the court grants final approval and any appeals are resolved.
At the moment, a payment date has not been announced, which means consumers may need to wait several months before receiving compensation.
The key date for consumers is September 3, the deadline to file a claim. After that, the settlement administrator will review submissions and determine eligible payouts.
As for the larger industry, healthcare companies are increasingly relying on outside billing and technology providers. That could create additional risks of sensitive patient information getting exposed during cyberattacks.
Contact Newsweek editors on this story: Kate Nalepinski and Edward T. Cummins .
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