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They Know What You’ve Been Buying: How Insurance Gets Your Spending Data

As news reports started coming out last year that insurers and healthcare providers were tracking and analyzing individual's spending data, a lot of people were immensely shocked. This personal data is accumulated from various sources, oftentimes without prior knowledge or permission. Knowing that our personal spending behaviors are used to assess health concerns, risks, and more seems invasive and intrusive in our freedom and rights to privacy. The truth is that some privacy laws will protect us, but our information is out there.

Where is the data coming from? 

The collection of data is endless. We may not realize it, but there is data collection on just about all Americans. And, if you have a credit card then you can be sure that your usage is being amassed. Each and every credit card company gathers spending data records about their cards issued, and they share all the information collected. The privacy policies oftentimes have a tendency to be rather vague or confusing. 
Much of consumer’s information and data is made public. It is easy to find information on homeowners or business owners. Criminal records are available online, as well as home phone numbers and addresses. Data collectors continually search for and amass records such as birth, death, and marriage certificates, which are public record. 
The collection of consumer information and data is gathered through commonplace transactions and credit card interactions. Whenever a credit or debit card, or even loyalty cards given by stores, are used, the consumer information is collected and stored. Many drug stores gather information about medications and other medicine that is purchased by you and your family while utilizing their rewards or wellness cards. Theme parks gather sensitive information of kids visiting them, which may include the names and ages of kids, and they have the right to distribute this information with any of their affiliates. 
Many have never considered that innocently providing your zip code while checking out with the cashier will allow you to be identified rather easily. Online surveys or filling out information on the web in order to receive a coupon or other incentive is an easy way to gather more of your information; such as family size, ages and names of children, income, occupations, and much more details. 
Immense quantities of data are amassed when we least expect it and without our even knowing it is happening. While we visit our favorite website or browse the web, our every move is being tracked by multiple information gathering establishments at the same time. They often times know more about our web habits and buying preferences then we care to imagine. If we log onto many of the popular forums or social media sites we are being tracked and monitored. The major search engines even analyze our email content while we are typing so they can place advertising within click range or in our inbox. 

Why is our spending data important to healthcare providers? 

All the private data and personal information that is collected and analyzed is because of money. Improving the overall health and well being of patients will inevitably lead to greater profits and decreased spending. Insurance carriers and doctors have become inspired to utilize each and every alternative in order to lessen their expenses as more responsibility for outcomes of healthcare patients is put on them. 
Those that support data gathering in the healthcare field will rationalize that the ultimate goal is to help doctors and insurers identify the patients that are high-risk. Once the risks are identified they can proceed before any major health crisis happens. Research has shown that the data gathered helps to provide significant insight into the habits and lifestyles of patients, even more so than the questionnaire the doctors can get in a short visit. Advocates of data research also like to note that data is utilized for promoting and advertising, so it should also be used for a the betterment of society. 

What’s the problem?

A major problem with data mining from healthcare providers is the inaccurate data that may be collected. If two different people have the same names or a shared account or computer is used are just some of the ways that data can be irregular. Because the consumer oftentimes does not even know that he has a file, there is no way to find out if the data collected is accurate or not. Many insurers assess a risk grade for patients based on the information and data that is collected, while the doctors may not even have an opportunity to view the patients’ transactions. Because of this there is not an accurate way to realize if the risk score is established on information that is accurate and reliable. 
Consumers consent is another issue with data mining. Because many consumers do not know, or realize, that data gathering is being performed on them, they have no way of declining to take part in the analysis. There is strong opposition to third parties analyzing risks when healthcare is concerned, and they would rather rely on face-to-face discussions with their doctors over these concerns. 

What can you do about data collection and the use of it?

There is not much that can be done in order to stop the collection of data, or to have any say in how your personal data is used. Many experts in privacy have noted that it is exceedingly difficult, if not impossible, to avoid having your data collected. The first step is to find out just who is compiling the data on you. Oftentimes, there are several companies’ simultaneously gathering data. Then, learning the process to opt out can be quite arduous and quite frustrating. Some companies will not permit opting out, while others demand a letter in writing. If you use a credit card then you are not able to opt out because having the privilege of using their card equals user consent. For those consumers that are looking for ways to reduce the amount of data that is collected, here are ten tips you should consider: 
1. The number of third parties you provide information to should be limited. 
2. Always check to make sure you are using encrypted web pages when online shopping. 
3. Avoid clicking links in emails that are suspicious or unsolicited. 
4. Don’t allow websites to keep your credit card information in their system. 
5. Watch what information you give out on social media. 
6. Regularly change your passwords and PIN numbers. 
7. Create passwords that will not be easy for others to guess. Use at least eight characters, include numbers, symbols, uppercase and lowercase, and you can even intentionally misspell a word. 
8. Consider signing up for credit monitoring. 
9. Immediately freeze all credit accounts if you have any reason to believe you believe your information may have been breached. 
10. Continue to keep track and monitor all your accounts and watch for any suspicious fees or charges.
The practice of data collecting has been going on for many years, and is not likely to change anytime soon. The sheer volume of personal information and data collected by companies has amplified awareness and awakened many consumers to be aware of their privacy concerns.
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Alice Bryant's picture

Alice Bryant is the Editor of Creditnet and a personal finance expert with over a decade of experience writing about credit cards, credit scores, debt repair, and more.

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