The Washington Post recently published an article, later picked up by MSNBC, on the fact that health insurance companies are now targeting patient’s electronic prescription records as a quick, easy and relatively inexpensive way to evaluate a person’s insurability.
Gone are the days of contacting a physician’s office or hospital business center and speaking with a live human or, alternatively, waiting weeks for medical records to be mailed. The Internet, once hailed as the harbinger of a paperless society, has finally succeeded in becoming just that. Unfortunately, this single instance of achievement is in precisely the sort of arena where human, rather than machine, contact is so essential, and delay (rather than haste) may err on the side of justice.
The Post has since dropped the original link, as has MSNBC, but a couple of bloggers picked it up. One, called Lambert’s blog, identifies the same fatal flaw in the system that originally caught my eye.
If you really need insurance, and your application goes to an insurer who uses one of the new “health credit reporting” companies that access the above-mentioned electronic prescription records, you won’t get it. Let me explain why.
These reports, from such companies as Ingenix (the MedPoint tool) or Milliman (IntelliScript), track the prescriptions you use. The only way you escape detection is by paying cash. And I mean full price, not one of those pharmacy savings programs from Walgreens, Target or Walmart.
Say you get in a really bad auto accident and are on prescription painkillers for months, while going through physical therapy. When you go to get new insurance (because your old insurer has canceled you, or you’ve been fired for being out of work so long), Ingenix will give you a “pharmacy risk score.” (This is likely a range of one to five, with one being very bad, though no one knows the scoring system – or at least no one is telling.)
Your continued use of Vicodin, which makes you look like a narcotics addict, will earn you an Ingenix score of one, and the insurance company will deny coverage. Milliman, slightly more charitable (or perhaps merely overworked and understaffed) will simply code your record red (on a scale from red to green), signaling the highest-risk category. The only drug that qualifies for green status is apparently birth control, and even that is increasingly suspect.
The same applies to every drug on the market, from Metformin for type II diabetes to Lipitor for cholesterol, and includes AIDS cocktails and cancer medications.
One of the greatest dangers in these reports is that a number of drugs are used for different purposes. I, for example, take atenolol for a minor heart rhythm disturbance, but it is also used to control blood pressure. The dose I take would likely cause an insurer to red-flag me as a high stroke or heart attack risk, when in fact nothing could be further from the truth.
According to Richard Dick, who built the database that Ingenix now uses, the system saves insurers money.
No kidding. If the insurance company doesn’t outright deny coverage – a huge savings – they will put you in a higher-risk category and your premiums will be unaffordable. Assuming you pony up the first month’s premium out of desperation, you will likely have a higher co-pay as well, and end up spending more out-of-pocket for prescriptions and other medical care than if you’d simply gone it alone. This is a definite cost-savings to the insurance company, which keeps your premiums, even when you default on the policy. At least with life insurance, you get something back.
These health credit reports cost insurance companies roughly $15 per search. Minnesota-based IntelliScript runs about a million a year, and Milliman, its Wisconsin competitor, brings in a reported $575 million a year. Ingenix, Milliman and IntelliScript are all private companies owned by equity investors and are, as such, exempt from certain types of mandatory reporting.
In February, the Federal Trade Commission decided that such reports qualify as consumer reports under the Fair Credit Reporting Act, so insurance companies that reject applicants must provide a copy of their report, which they may then challenge – something insurers previously failed to do. The FTC did not, however, fine the companies for their failure – a stance that one privacy consultant calls opening the door to new and improved violations.
Ingenix (MedPoint), Milliman, IntelliScript and even pharmacy benefit managers are not covered by the Health Insurance Portability and Accountability Act (HIPAA). The first two companies have said that they only provide information with a patient’s consent, but there is so far no way to verify this, since the government doesn’t have the authority to investigate.
Congress is considering a proposal that would expand the government’s ability to regulate such companies – including the right to investigate and impose fines – and prohibit the sale of electronic medical records.
Dick, who acknowledges opening this Pandora’s Box when he first got the idea of linking pharmacy databases a decade ago, insists that his built-in privacy tool (requiring user consent for the release of information) protects consumers. He further defends the system as providing full medical transparency for both ER responders and the government.
In order for it to work properly, he adds, the database must be independent of all who hold the data. In other words, companies like Ingenix can input, but not output, data.
This would probably work, if the government (read FDA) had a better reputation for accuracy, efficiency and fair play. As it stands, expect Congress to table the proposal indefinitely and health insurance to continue being a Holy Grail sought by the needy and achieved only by the healthy and wealthy.
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