Privacy Issues May Scuttle Health Records Technology

One of President Obama’s top priorities during the first days of his administration will be to overhaul the healthcare system. The administration’s plans include an ambitious system to computerize the health records of millions of Americans and to link doctors, hospitals, insurance companies, and pharmacies with information about diagnosis and treatment.

Proponents claim that digital medical records can save both money and lives and create jobs at the same time. About $20 billion of the proposed $825 billion economic stimulus package has been earmarked for this technology.

A major stumbling block to these ambitious programs, however, is a bitter fight over privacy issues, which has seen some top legislators from the President’s own party voice concerns over poorly regulated exchanges of medical information. Those pushing for strong privacy safeguards point to numerous security breaches at hospitals, insurance companies, and government agencies that have compromised sensitive information on thousands of consumers. A key security measure being discussed would require a patient’s permission before any information could be released. Other privacy proposals range from allowing patients to segregate certain personal information from their medical records to requiring providers and insurance companies to use encryption technology on stored data.

On the other side of the issue are insurance companies and pharmacy benefits managers, who argue that excessive privacy concerns could nullify the benefits of electronic medical records. Some Washington pundits note that the best-case scenario for those against privacy safeguards is that Congress will leave such concerns to the rule-makers at the Department of Health and Human Services, where they may find a more receptive audience.