People to Insurers: Don't Use Big Data to Measure Risk

As healthcare insurance companies are putting more energy into big data and analytics, U.S. citizens are becoming wary.

A new survey from LendEDU, a finance site, found that just 15 percent of people think health insurers should have the green light to use big data to measure the risk of a given policy. And 72 percent of respondents supported banning the practice.

These top-line findings suggest patients are digesting the data privacy concerns surrounding the health insurance sector. For years, critics have warned that payers will leverage big data and analytics in previously unseen ways to decide who receives — and doesn’t receive — coverage. Recent reports suggest this sort of dystopian vision could become reality, with insurers trying to predict health costs by analyzing data on race, TV watching habits and more.

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“It seems that people in the U.S. simply do not want to open another avenue that allows their personal information to become public knowledge, and it’s hard to blame them,” wrote LendEDU research analyst Mike Brown.

After Silicon Valley scandals and revelations regarding insurers’ use of data, LendEDU surveyed 1,000 U.S. adults to better understand how they feel about “the intermingling of advanced data and the insurance business,” according to the report.

Researchers found that 55 percent of participants considered insurers accessing private data just as threatening as when tech companies do the same.

“… This survey data can likely mean one of two things: People are not as concerned as we think when it comes to Facebook unlocking our personal data or consumers are seriously concerned about insurance companies doing the same,” Brown wrote.

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Although 71 percent of respondents said they would not approve of an insurance company having access to their DNA in exchange for less expensive coverage, 18 percent said they would be fine with such an arrangement. This issue could become more important as direct-to-consumer genetic-testing companies like 23andMe gain popularity.

Curiously, 46 percent of the group said they would not trust insurance coverage from a startup company. That number could decrease as time goes on, given the proliferation of high-tech, data-driven insurance startups, who often operate against a backdrop of sleek, millennial-focused marketing campaigns. At the same time, going by the trends unearthed in the survey, the marriage of the tech startup and health insurance could prove dangerous or undesirable in the eyes of the public.

LendEDU also asked whether consumers would be OK with insurers using in-home cameras or biometrics to monitor their policyholders. The majority’s unsurprising response: No.

“Data on past health or financial history is one thing, but the line for most consumers is crossed when what they do in the comfort of their own homes becomes part of the equation,” the report concluded.

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