Editorial: Privacy is taking a back seat

Sunday, Oct. 31, 1999 | 10:17 a.m.

In this highly computerized age, where even the most personal information can be just the click of a mouse away, people are concerned that their privacy rights are in jeopardy. Despite this legitimate fear, Congress has done nothing this year to pass protections barring companies from swapping and selling sensitive data -- including medical records. Often consumers don't even know the information has changed hands.

More than a week ago Congress and the White House had an opportunity to ensure privacy protections were included in sweeping legislation that would overhaul the financial services industry, but they failed to do so after objections were raised by industry lobbyists. The bill, which President Clinton says he will sign into law once it reaches his desk, will result in a financial windfall for banks, securities firms and insurance companies, which will be allowed to merge for the first time since the Great Depression.

Many members of Congress, including Sen. Richard Bryan, D-Nev., one of the leading proponents of privacy rights, say they will vote against the financial services bill because it erodes consumer protections. These newly affiliated companies, especially banks and insurance companies, will be allowed to exchange highly confidential medical information without having to get the consent of consumers. As Bryan has noted, there will be nothing to stop an insurance company from telling an affiliated mortgage company that your spouse was just tested for a terminal illness, which could result in a home loan being denied unfairly.

The financial services overhaul legislation isn't the only black eye for Congress: Earlier this year it missed a self-imposed deadline of Aug. 21 to pass medical privacy legislation. It's not as if Congress didn't have enough time, considering that the deadline was set in 1996. Unfortunately health insurance companies have used their influence to block any legislation protecting consumers. When Congress established the deadline in 1996, it did at least include a provision that if it failed to act by this year, then the Department of Health and Human Services would have the authority to write rules regulating this area.

President Clinton announced Friday that he will seek regulations that would restrict how health insurance companies share or sell electronic medical records. Doctors, hospitals or health plans, under Clinton's plan, couldn't release medical records without getting written authorization by the patient. The problem is that existing law only allows the rules to cover electronic records. It would take an act of Congress to protect written medical records.

While Clinton is asking Congress to close this loophole, don't hold your breath waiting for legislation protecting medical privacy. The sad fact is that if an industry has enough clout -- and donates enough campaign contributions -- it is likely it will be exempt from any congressional oversight, no matter how important.