By Edward F. Shay, Esq.
On September 11, 1997, the Secretary of Health and Human Services submitted to Congress detailed guidelines on how to prepare federal legislation to protect the privacy of medical information. In June, 1997, the National Committee on Vital and Health Statistics issued its long awaited report on improving confidentiality in medical information and records. Two major privacy bills are pending in Congress. Clearly, forces of change are at work which require the formulation of new policies on privacy and confidentiality. While information systems are a major factor in any reassessment of how health information in managed, equally important is the type of information, for example the results of genetic testing, which can dramatically alter the way an individual is perceived.
The recent explosion of genetic testing and growing concern about how to manage genetic test results illustrates how privacy and clinical developments are straining existing laws. Interestingly, the federal government is behind the states in dealing with privacy and genetic information. Of course, some states, such as Pennsylvania, have not legislated at all specifically to control the use of genetic test results.
With the enactment of the Health Insurance Portability and Accountability Act (HIPAA), federal law for the first time undertook a broad range of insurance regulatory activities previously left to the states. Included among many other provisions is a brief provision which prohibits issuers of health benefits and health insurance from using “genetic information” in granting, denying, canceling and otherwise evaluating an individual’s eligibility for health coverage. In Section 101 of HIPAA, Congress acted to alleviate growing concerns that the results of genetic research and biotechnology would be misapplied.
Over the past two years, breakthrough discoveries in genetic testing have suggested that the predictability or susceptibility of certain genetically related diseases would make available exquisitely sensitive information about individuals which heretofore did not exist. Thus, employers, insurers, law enforcement officials and a host of other interested persons might inquire or compel disclosure of information which could predict the onset of dread diseases or the increased likelihood of susceptibility to these diseases. Already a groundswell of state laws has sought to regulate the use or misuse of genetic testing information in the issuance of health and life insurance. However, the complexities of regulation of health insurance and health benefits made many of these protections inapplicable to many individuals who receive health benefits through certain employer sponsored plans. Section 101 of HIPAA began to bridge the gap between state and federal initiatives.
Genetic information is the end product of genetic testing. Genetic testing is not a novel clinical development and in some ways it has been practiced for many years. For example, some types of genetic information may be gathered from a focused medical history and physical examination. Likewise, for many years, states have required newborns to be tested for hereditary diseases such as phenylketonuria, a treatable metabolic disorder.
The current concerns stem from entirely new, dramatic studies in molecular science. Commencing in 1990, Congress authorized the National Institutes of Health (NIH) and the Department of Energy (DOE) to participate in a multinational effort to map the human genome. Literally hundreds of scientists have labored continuously since 1990 to complete the Human Genome Project (HGP). The HGP is intended to map the entire human genome, determine the sequence of genetic codes and ultimately to understand the function of genetic codes.
Notwithstanding the recent federal entrance into the regulation of genetic information, the states have played the most significant role in this type of regulation to date. At least sixteen states regulate how insurers use genetic information. In the aggregate, these statutes are of two types. A limited number of states have regulated insurers in the use of information relating to specific genetic traits such as sickle-cell trait or hemoglobin C trait. These disease-specific statutes were usually adopted in the 1970s in response to then permissible underwriting practices which permitted insurers to refuse to issue or renew a policy to the carrier of a trait disease. More recently, a dozen or more states have sought to respond to the complex issues presented by the rapid growth in genetic knowledge and technology. Within a range of predictable variation, recent state statutes on genetic information and insurance practices seek to:
• Define genetic information.
• Prohibit enumerated unfair insurance practices.
• Require certain consumer protections.
• In some but not all cases, provide for penalties for violations of these laws.
State statutes almost without exception articulate the scope of their genetic information laws by how they variously define what is meant by genetic information. Several southern states narrowly focus on sickle cell trait to define the scope of their laws on insurance discrimination based upon genetic information. Florida, for example, prohibits refusal to issue a disability insurance policy “solely because the person to be issued has the sickle cell trait.” Maryland law prohibits insurance discrimination based “solely on sickle-trait, thalassemia minor trait, hemoglobin C trait, tay sachs trait or any genetic trait which is harmless within itself, unless there is an actuarial justification for it.” Likewise, North Carolina keys its law to “the fact that the person to be insured possesses sickle cell trait or hemoglobin C trait.”
In contrast, more recent state statutes which regulate the use of genetic information in insurance define genetic information without regard to a specific disease or genetic trait. State law in Montana focuses on a “genetic condition” meaning “a specific chromosomal or single-gene genetic condition.” Ohio defines “genetic screening or testing” to mean a laboratory test of a person’s genes or chromosomes for abnormalities, defects, deficiencies, including carrier status, that are linked to physical or mental disorders or impairments, or other disorders whether physical or mental, which test is a direct test for abnormalities, defects or deficiencies, and not an indirect manifestation of genetic disorders.
While the foregoing definitions are less narrowly drawn in terms of a specific genetic trait, these controlling definitions still confine themselves to sources or types of information which are restrictive. Although genetic information can be derived from many forms of inquiry, most state statutes restrict their definitions—and hence their applicability—to “genetic testing.” The phrase “genetic testing” by its plain meaning suggests a process which is inherently narrow. Usually, the process involves a clinical laboratory test. Often, these types of definitions require that the test must be performed on human DNA material. These two elements of the typical state statutory definition of genetic testing limit the applicability of these laws to only the most sophisticated laboratory procedures on actual DNA. Pure laboratory based genetic testing is technologically complex and expensive. These underlying realities to what constitutes “genetic testing” tends to further narrow the applicability of state statutes predicated on these definitions.
On balance, most state statutes that regulate the use of genetic information in insurance rely on definitions with three characteristics. First, the operative definitions include only limited activity (i.e., laboratory tests). Second, the controlling definitions require a specific purpose (i.e., determining the presence or absence of a gene abnormality). Finally, the definitions often exclude more commonplace sources of genetic information (i.e., a routine medical history).
Once state statutes on the use of genetic information in insurance establish the scope and type of genetic information to be regulated, they impose prohibitions on how insurers may or may not use the genetic information. These prohibitions are aimed at underwriting practices, policy issuance practices and differential rating practices. Prohibitions in current law will illustrate the range of practices that are regulated by current laws. California law prohibits discrimination in policy terms, discrimination in fees to brokers, refusal to accept an application, failure or refusal to issue an application, cancellation of a policy or charging a higher premium based on genetic characteristics. New Hampshire prohibits a health insurer from requiring or requesting a person to undergo genetic testing, or requiring them to reveal the results of genetic testing, or conditioning coverage or rates on whether someone has undergone genetic testing.
State legislators and regulators have constructed the prohibitions on insurers in the use of genetic information by relying on tools familiar to insurance regulators. In most states, the primary techniques for controlling the use of genetic information is to rely upon the state’s existing laws on unfair insurance practices. These unfair insurance practice laws regulate an insurer’s ability to classify risks by rationing the information that an insurer may include in the risk classification process. Finally, the prohibitions in state laws are intended to insure that coverage remains available to persons in the protected class by requiring initial and continued coverage on the same basis as risks that are not evaluated based on genetic information.
Although state insurance regulators typically rely upon unfair insurance discrimination laws to manage the abuse of genetic information, the state laws specific to genetic testing and insurance also provide additional controls on the conditions under which genetic information may be acquired and disclosed. Approximately one half of the states that regulate genetic testing and insurance provide for written informed consent to genetic testing and specific consents to disclosure of genetic information. Some examples will illustrate the range of protective provisions.
Most state laws that address the confidentiality aspects of genetic information rely on a combination of privilege, consent and limited permissible disclosures which must be authorized in writing. None of these statutes delves in great detail into the mechanics of confidentiality, but all of them articulate a public policy which recognizes the interests of the individual in maintaining the privacy of medical information.
State laws that regulate the use and abuse of genetic information in insurance provide a limited array of penalties and remedies in the event of a violation. California offers the greatest range of remedies with specified fines which increase in amount as the volition progresses from negligence to willful behavior. In addition to fines, California law states that actual damages are available to the injured party. Other states simply graft their genetic information laws onto existing systems for regulating unfair insurance practice. In these states, the remedies available to the individual may be very limited as a matter of state law, or non-existent under the preemptive effect of federal law.
To date, state legislatures have taken the lead in defining certain types of genetic test information and protecting against its inappropriate use in the insurance industry. These laws are motivated by a perception of the immutability of genetic information and the impact of that information in the hands of insurers. The problem of rapidly changing and significant clinical information requiring special use restrictions is not unprecedented. The advent of the AIDS epidemic triggered problems similar to the abuse of genetic tests results. Insurers viewed HIV positive individuals as a high risk minority and subjected them to canceled insurance, denied coverage and related underwriting practices which flowed from the perception of the immutability of a positive HIV finding. States responded with stringent laws designed to protect the confidentiality of HIV patient information. Strict federal laws were enacted also.
Of course, state regulation of insurance may not reach many important interests in the delivery of health benefits. Complex inter-relationships between federal and state regulation of insurance limit the ability of state laws to impact many employer sponsored health benefit plans. The federal role remains to be developed from the initial commitment made under Section 101 of HIPAA. As genetic science presses forward, a federal policy on the use of genetic information will inevitably become law.
Edward F. Shay, Esq., is a member of Saul, Ewing, Remick & Saul’s Health Law Department in Philadelphia.