MEDICAL PRIVACY: House Bill to Protect Bank Customers
House Banking Committee Chair Jim Leach (R-Iowa) yesterday proposed legislation that would require financial institutions to get customers' consent before sharing their medical information with other firms or using it when deciding whether to grant credit. Similar to the Clinton-Gore privacy proposal, a "hot election-year issue" endorsed by Democratic lawmakers and opposed by many Republicans, Leach said his bill "ensures privacy protection in an area of great sensitivity to all Americans: personal health and medical records" and protects consumers applying for bank loans or credit cards from being rejected based upon medical data provided by a bank-affiliated insurance company ( AP/Baltimore Sun, 6/7). The banking industry is divided over new voluntary guidelines that prohibit banks and savings associations from disclosing customers' medical information or using such information for marketing or credit decisions. The guidelines were announced last year by the American Bankers Association, the Consumer Bankers Association and the Financial Services Roundtable. "Medical privacy is a major issue for Citigroup," Ken Guenther, executive vice president of the Independent Community Bankers of America, said. "It is not a major issue for thousands and thousands of community banks, savings and loans, and local insurance agents," he added. According to Leach's proposal, financial companies would be required to obtain customers' written consent before disclosing "individually identifiable" health or medical information to another company. It would also require specific consent for disclosure of mental-health information; prohibit the use of medical data to decide credit grants without expressed consent and give consumers the right to inspect and correct their medical data under the control of a financial company (Gordon, AP/Philadelphia Inquirer, 6/7).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.