Health Insurance and Our Data
By Ben Thompson | March 29, 2019
Health Insurance is a part of life. It is something that most of us need and have to purchase each year whether we like it or not. If you’re lucky, this involves picking a plan offered by an employer who takes on some of the financial burden, which is helpful considering plan prices continue to rise. Otherwise, you’re left to either choose a full price plan from the marketplace (at least $1000/month for family of 3) or the risk of going uninsured, paying out of pocket for any medical expenses and rolling the dice that a catastrophe won’t cause you major debt.
When you sign up for a health insurance plan you probably assume that the insurance company has some of your basic data, like the data you shared when you signed up or some medical record data, however, you might be surprised to find out that insurance companies collect far more than basic demographic information. These companies are collecting, or purchasing, all sorts of data about people, including information on income, hobbies, social media posts, recent purchases, types of cars owned and television viewing habits. This should be concerning. Consider that health insurance companies make more money by insuring more healthy people than unhealthy. What if they begin to use data to predict who is healthier and make coverage decisions from these predictions? For example, LexisNexis is a company that collects data on people and uses hundreds of non-medical personal attributes, like those previously mentioned, to estimate the cost of insuring a person and sells this information to insurance companies and actuaries. They say that this information is not used to set plan prices but there are no laws prohibiting this.
Currently, HIPPA and the Genetic Information Nondiscrimination Act only regulate how health records are used but not other data, and even the regulations on health records are fairly lax. For example, the Genetic Information Nondiscrimination Act does not apply to life insurance. This means that a life insurer can use your genetic data if you’ve had a genetic test, like 23andMe or Ancestry.com, to alter your policy. If you refuse to share the requested data after having a test done, they can legally terminate your policy. More generally, there are no laws prohibiting insurance companies from collecting any non-health related data about you or how they use it. It is all free-game.
When you use the internet you don’t assume that your actions could influence your ability to get fair health coverage. You’re not anticipating that data brokers are tracking your every action, attempting to infer as much as possible about you, often getting it wrong and selling it all to insurance companies. There is great evidence that the data that data brokers compile is incorrect. We need to start demanding that there be policies in place to regulate what data insurance companies can collect and how they can use it.
With the passing of GDPR in the EU, an EU citizen is legally allowed to request to view all of the data an insurer has on them, request that it be deleted from their databases, and/or make corrections to it. It is time that the U.S. start implementing similar regulations. These straightforward rights would move the U.S. a long ways towards making sure that everyone has access to to fair health coverage and has control over their personal data.
Allen, Marshall. “Health Insurers Are Vacuuming Up Details About You — And It Could Raise Your Rates.” Propublica, Propublica, 17 Jul. 2018, https://www.propublica.org/article/health-insurers-are-vacuuming-up-details-about-you-and-it-could-raise-your-rates
Andrews, Michelle. “Genetic Tests Can Hurt Your Chances Of Getting Some Types Of Insurance.” NPR, NPR, 7 Aug. 2018, https://www.npr.org/sections/health-shots/2018/08/07/636026264/genetic-tests-can-hurt-your-chances-of-getting-some-types-of-insurance
Leetaru, Kalev. “The Data Brokers So Powerful Even Facebook Bought Their Data – But They Got Me Wildly Wrong.” Forbes, Forbes, 5 Apr. 2018, https://www.forbes.com/sites/kalevleetaru/2018/04/05/the-data-brokers-so-powerful-even-facebook-bought-their-data-but-they-got-me-wildly-wrong/#69dd2f843107
Miller, Caitlyn Renee. “I Bought a Report on Everything That’s Known About Me Online.” The Atlantic, The Atlantic, 6 Jun. 2017, https://www.theatlantic.com/technology/archive/2017/06/online-data-brokers/529281/
Morrissey, Brian et al. “The GDPR and key challenges faced by the Insurance industry.” KPMG, KMPG, Feb. 2018, https://assets.kpmg/content/dam/kpmg/ie/pdf/2018/03/ie-gdpr-for-insurance-industry.pdf
Probasco, Jim. “Why Do Healthcare Costs Keep Rising.” Investopedia, Investopedia, 29 Oct. 2018, https://www.investopedia.com/insurance/why-do-healthcare-costs-keep-rising/
Song, Kelly. “4 Risks consumers need to know about DNA testing kit results and buying life insurance.” CNBC, CNBC, 4 Aug. 2018, https://www.cnbc.com/2018/08/04/4–risks-consumer-face-with-dna-testing-and-buying-life-insurance.html