Wearable Tech World Feature Article
August 17, 2015

Survey: Consumers Prefer Keeping Wearable Device Data from Insurers

According to research firm Parks Associates, the majority of those surveyed indicated that they are not willing to share data collected from wearable devices, even if it meant receiving a discount on their health insurance premiums. In spite of this reluctance, these same consumers were willing to share data for the purpose of troubleshooting the devices themselves.

The results of the survey varied significantly by device. Forty-two percent of digital pedometer owners were willing to share data in order to receive a health insurance discount; for smartwatch owners the total was 35 percent; and for sleep-quality monitor owners it was 26 percent. Nevertheless, a solid majority of device owners was not willing to share data.

Consumers are justified in their concerns about health data privacy. The Los Angeles Times told in July of a security breach in October 2014 where hackers compromised UCLA Health Systems’ computer network, putting 4.5 million patients’ sensitive data at risk. What was troubling about the incident was that it took nearly seven months from the time suspicious activity was discovered in October, to May 5, which is when investigators determined the system was hacked. Additionally troubling was that the data was not even encrypted.

Other major breaches include a cyberattack at Anthem where as many as 80 million patients’ information was compromised and an attack exposing 3.9 million patients’ data from Medical Informatics Engineering, a Fort Wayne, Indiana-based electronic health information firm.

HIPAA isn’t always helpful in the case of security breaches where SSNs, street addresses, email addresses, employment, and income information, but not healthcare-related data, is compromised. According to a USA Today report on the Anthem breach: “Because no actual medical information appears to have been stolen, the breach would not come under HIPAA rules, the 1996 Health Insurance Portability and Accountability Act, which governs the confidentiality and security of medical information.”

Consumers are apparently more willing to share information when it is used for technical support issues. "More consumers are willing to share data to troubleshoot device problems, suggesting benefits that ensure owners get the full advantages of their products could be more enticing," said Jennifer Kent, Director, Research Quality & Product Development, Parks Associates.

The argument by healthcare insurance providers is likely to be that the information consumers could provide from various wearable devices is important in creating policies that are fairly priced and properly manage risk. That argument won’t carry much weight with consumers who can argue back about the numerous security breaches that have occurred recently. Until the healthcare industry can demonstrate it’s reliable in protecting sensitive information, consumers’ opinions won’t change.

Edited by Rory J. Thompson

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