The Washington Post is reporting that health insurers are now mining data from a variety of databases when you apply for insurance. From the story by Ellen Nakashima:
“Health and life insurance companies have access to a powerful new tool for evaluating whether to cover individual consumers: a health “credit report” drawn from databases containing prescription drug records on more than 200 million Americans.”
This shouldn’t really surprise anyone. Insurance companies make decisions based on information. The more information they have, the more accurately they can underwrite. When they underwrite people accurately, the premiums charged.
Consumer groups, myself included, get upset when insurance companies conduct “post claims underwriting.” Post claims underwriting is when an insurance company looks at records after a claim is filed and then decides if it should cancel the policy. Post claims underwriting is, quite simply, wrong.
So, the solution? Let the insurance companies do the underwriting at the claims stage. Insurance companies get medical records now and do this. This process just allows them to do it faster and cheaper. I just don’t see the problem.