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    Bloomberg News: Iris Scans Seen Shrinking $7 Billion Medical Data Breach

    Bloomberg News reports that hospitals are looking to biometric technology, including iris scans, as a defense against security breaches and medical identity theft:

    Clinics and hospitals around the world are acquiring technology that identifies people based on physical traits to improve patient safety and stamp out fraud. HCA Holdings Inc. (HCA) hospitals in London, as well as health-care providers across the U.S., are buying so-called biometric technologies.

    Biometrics makers, such as Safran SA (SAF), Fujitsu Ltd. (6702) and closely held AOptix Technologies Inc. and M2Sys Technology, say demand from health-care providers is growing. While ensuring the right person gets the right treatment is the main reason for buying biometrics, hospitals and patients see another benefit: reducing the risk of data breaches that can lead to identity theft. […]

    Identify theft is leaving hospitals with unpaid bills and consumers on the hook for costly treatment they didn’t receive. Data breaches, which include lost and stolen information, may cost the health-care industry in the U.S. as much as $7 billion a year, according to a survey conducted by the Ponemon Institute, a Traverse City, Michigan-based organization that studies privacy, data protection and security.

    That explains why the health-care industry represents a growth area for the biometrics market, which Louisville, Colorado-based Acuity Market Intelligence forecast will increase about 20 percent a year to almost $11 billion by 2017. […]

    More than half of the 80 health-care organizations that participated in the Ponemon Institute’s survey reported one or more incidents of medical identity theft. Ninety-four percent had at least one data breach in the past two years, and 45 percent reported that they had more than five such breaches. The survey was sponsored by ID Experts Corp., a Portland, Oregon- based company that sells products and services to prevent data breaches. […]

    The technology isn’t foolproof. Medical identity theft is often an inside job, with employees of health-care providers stealing and selling the information, [said Pam Dixon, executive director of the World Privacy Forum, a San Diego-based nonprofit research organization.] Electronic record-keeping has made it easier to steal many identities at once, and using biometrics may only create more information to steal, she said.

    “You can scam this just as you scam an ID card,” Dixon said. “Palm vein scans or iris scans can be associated with other records, but you have to be inside the system to do it.”

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