Insurers testing health "credit reports" for underwriting

Insurance companies have begun testing ways to use databases of prescription drug and laboratory information to compile health “credit reports” to decide whether to offer coverage to individual consumers (Source: “Prescription Data Used To Assess Consumers,” Washington Post, Aug. 4, 2008).

The burgeoning industry is expected to take off with more widespread use of electronic medical records. Companies selling this service say it can allow insurance companies to make same-day decisions, in some cases, on whether a customer will be offered coverage.

"As health care moves into the digital age, there are more and more companies holding vast amounts of patients' health information," said Joy Pritts, research professor at Georgetown University's Health Policy Institute. "Most people don't even know these organizations exist. Unfortunately the federal health privacy rule does not cover many of them. . . . The lack of transparency with how all of this works is disturbing."