Consumer Federation of California

Think you can keep a medical condition secret from life insurers by paying cash for prescription meds? Think again.

A for-profit service called ScriptCheck exists to rat you out regardless of how diligent you are in trying to keep a sensitive matter under wraps. ScriptCheck, offered by ExamOne, a subsidiary of Quest Diagnostics, is yet another example of data mining — using sophisticated programs to scour databases in search of people’s personal information and then selling that info to interested parties.

To be sure, life insurers have a need to know as much as possible about the people they cover. This helps mitigate risk and potentially keep rates affordable for everyone.

But for anyone who is taking an antidepressant, say, or being treated for a chronic condition, privacy can be a key consideration. You may not want employers — or potential employers — to know what you’re taking. By the same token, you may not want to risk a potentially sharp increase in insurance premiums. “It’s a tough issue,” said David Bryant, a Los Angeles life and health insurance broker. “From the consumer’s perspective, you may want to keep certain things under wraps. But when you buy a policy, an insurer will want to pull all information about you.”

And thanks to ScriptCheck, the insurer doesn’t have to give things a second thought. By purchasing this or a similar service, the insurer can be notified of all prescriptions you’ve filled in recent years, regardless of how you paid. Turns out, tracking down such information isn’t that difficult.

Forty-eight states, including California, maintain databases that monitor people’s prescription-drug use, although access to this information is generally limited to doctors, pharmacists and government officials. In the private sector, pharmacy benefit managers, the powerful middlemen for insurers and drugstores in most prescription-drug transactions, also keep detailed records of who’s taking what.

And Quest Diagnostics, ExamOne’s parent, knows a thing or two about many people’s conditions. The company bills itself as the world’s leading provider of medical diagnostic services, such as blood, urine and genetic tests. Roughly a third of U.S. adults interact with the company each year, Quest says.

“It’s all out there,” Bryant said. “If you bought a prescription drug legally, even if you paid cash, that information is available.”

Dr. Charles Portney, a Santa Monica psychiatrist, told me about being visited recently by a patient who was concerned about keeping his visits and any prescription meds confidential. “He was concerned about psychiatric care impacting his career,” Portney said.

Two months later, a life insurer contacted Portney with a request for the patient’s entire medical file. The patient had applied for life insurance before beginning treatment but hadn’t subsequently revealed that he was seeing a psychiatrist.

Portney said the patient, himself a healthcare professional, looked into things and discovered that the insurer had contracted with ScriptCheck to find out what prescription drugs he was taking. “ScriptCheck apparently takes the prescription information and the doctor’s name from pharmacy records and uses some kind of algorithm to guess someone’s diagnoses,” Portney said.

“The level of intrusion — it’s shocking,” he said. “And it takes a lot to shock me at this point in my career.”

From a purely business perspective, a service like ScriptCheck is perfectly understandable. An insurer would be remiss if it didn’t use every tool at its disposal to determine the risk posed by policyholders and prospective policyholders. From a privacy perspective, it’s just plain spooky.

No one at ExamOne or Quest Diagnostics responded to my requests for comment.

But ExamOne’s website says that ScriptCheck “enables expedited delivery of prescription and related information to underwriters and investigators for use during the risk assessment or claim investigation process.”

“Profiles include the results of a five-year history search with detailed drug and insurance eligibility information, treating physicians, drug indications and pharmacy information,” it says.

And the service doesn’t end with a list of people’s meds. It also provides best guesses as to a patient’s underlying medical condition, “which is derived from the predictive modeling that is performed by Optum MedPoint.” MedPoint is a service offered by another for-profit medical data broker, OptumInsight, a subsidiary of insurance giant UnitedHealth Group, which also has voluminous files on people’s healthcare.

A “case study” on ExamOne’s website says ScriptCheck “greatly decreases the time to perform risk assessments and integrates complete prescription drug histories into a real-time underwriting process.” It says ScriptCheck relies primarily on “drug histories provided by the largest Pharmacy Benefit Management companies in the United States.”

“No other provider has as much access to this information as ExamOne,” it says.

The case study quotes an unnamed ScriptCheck product manager as saying that the service “looks at an applicant’s prescription drug history and displays risk assessments in real time.” This can provide “insight into a chronic condition that may have been omitted — intentionally or unintentionally by the applicant.”

Is any of this illegal? Apparently not. When you apply for life insurance, you sign away your federal medical privacy rights. That provides an enormous opportunity for the vast and secretive industry that trades in people’s personal information.

There’s not much you can do about it — it’s the world we live in nowadays. But it’s definitely something to keep in mind if your medical privacy is important to you.