Editorial: Seriously consider privacy

Friday, July 23, 1999 | 9:37 a.m.

Earlier this month the House passed legislation that would eliminate Depression-era barriers and allow banks, securities firms and insurance companies to merge. While a consensus has developed that easing such restrictions is long overdue, privacy advocates and physicians fear the legislation could allow medical records to be disclosed without a patient's consent.

It is disturbing that the House defeated an amendment to the bill that would have prohibited these newly affiliated companies from sharing medical records without first getting a patient's consent. The House's failure to close this loophole could mean that a health insurer could take the medical records of a patient with an illness and share them with an affiliated life insurance company, which that company could then use to deny a policy. Under the House bill, medical privacy could be jeopardized for many Americans in light of the recent merger mania.

Even though the House already has passed its financial services legislation, to her credit, Rep. Marge Roukema, R-N.J., who chairs a House subcommittee with oversight of financial institutions, went ahead with a previously scheduled hearing on Wednesday to address some of the privacy issues. Those advocating the legislation told the House panel that the bill sufficiently protects privacy. "Protecting privacy is good business," Dan Zielinski, a spokesman for the American Insurance Association, said. The problem, though, is that the existing House bill allows too much incentive for these companies to invade someone's privacy. And besides, if protecting privacy is such good business, why are insurers, banks and securities firms opposed to guaranteeing privacy protections?

There is a real danger that adequate privacy protections will not emerge when the Senate and House sit down to try to iron out differences between the different financial services' bills each house has passed. The Senate version hardly addressed privacy concerns at all since the upper chamber is considering separate legislation to address a variety of medical privacy protections. Still, the Senate should insist that strong safeguards be in place -- such as requiring patient consent prior to any medical records being released -- when it negotiates with the House over financial services legislation. There should be no compromise on medical privacy.