Doctors: House Bill Bad for Privacy
By MARCY GORDON, AP
WASHINGTON (AP), Doctors' groups warned Wednesday that the privacy of a
consumer's medical records could be invaded under a House-passed bill that would allow
banks, insurance companies and brokerages to combine and share information.
Officials of the American Medical Association and the American Psychiatric
Association said in congressional testimony that the legislation would violate a principle
that patients must consent to the disclosure of medical records.
Sharing of data on customers, which opens lucrative new marketing possibilities,
is one of the main reasons why banks, securities firms and insurance companies are seeking
to combine. Opponents of the legislation fear, for example, that medical records of
an insurer showing a patient has cancer or AIDS could be used to deny him a loan from an
affiliated bank.
The new bill is ``inadequate to protect patients' sensitive medical
information,'' Dr. Donald J. Palmisano, a member of the AMA's board of trustees, said in
testimony prepared for a hearing of the House Banking subcommittee on financial
institutions. Dr. Richard Harding, vice president of the psychiatrists' association,
said the bill ``will overturn the principle of patient consent for disclosure of medical
records.''
He noted that more than 40 other physicians' and patients' groups, including the
American Lung Association and the American Academy of Family Physicians, oppose the
medical data provisions. Consumers Union, the American Association of Retired
Persons and U.S. Public Interest Research Group also have objected to them. A top
Clinton administration official also criticized as too weak the medical data provisions in
the sweeping financial services bill, which would lift Depression-era legal barriers and
allow banks, securities firms and insurance companies to merge. ``No consumer
expects that in consenting to a physical examination for an insurance policy, he or she is
endangering an ability to obtain credit or employment,'' Treasury Undersecretary Gary
Gensler testified.
The administration, however, supports in principle the legislation, which
cleared the House early this month with a veto-proof vote, 343-86. The package also
includes a provision giving consumers the right to block banks and other financial
services companies from sharing their personal financial data with outside firms that
don't have the same corporate parent. The medical data section of the bill prohibits
insurance companies from sharing personal medical records with other types of companies,
including financial firms with which they are affiliated, unless customers give their
express written consent.
There are exceptions, however, such as a provision that would allow health
insurance companies to share medical data with life insurers when people apply for life
insurance policies. The exceptions ``swallow the rule,'' Dr. Palmisano
maintained. He cited another one, allowing financial companies to share a consumer's
medical data for research projects. Because the legislation doesn't define such research
projects, he contended, companies could assume they include marketing evaluations or
consumer profiling.
Drs. Palmisano and Harding said their groups wanted Congress to revise the bill
to specifically prohibit disclosure of medical data without consumers' consent and cut the
exceptions. In May, the Senate passed a substantially different version of the
financial overhaul legislation that does not include most of the financial and medical
privacy provisions. The Senate is considering separate legislation covering health
and medical privacy.
