Excellent Article on Medical Privacy, Disability, DiscriminationIssues Part 1

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by John F. Wasik
Consumer's Digest Magazine
Protecting Your Medical Privacy  

Your health history may be an open book to employers and insurers, and what 
they know can hurt you. You might lose your job, be passed over for 
promotions or be prevented from obtaining affordable health or life insurance 
because of your medical records. Here’s a look at the abuses we’ve found in 
the record-keeping system, and what you can do to ensure that your medical 
history remains private. 

Mario Feliberty, M.D., has a serious problem. His hands tremble when he picks 
up a pen enclosed in a foam plastic hair roller, without which it would be 
impossible for him to grip. He writes notes tentatively as he strains to use 
his injured wrists and hands.

As the former medical director of Kemper Life Insurance companies, Feliberty 
had been recruited to work for the Long Grove, Ill.-based life insurer. He 
has a varied and impressive résumé that includes positions in the Navy, 
insurance industry and private practice. He chose the position of medical 
director because the hours were more reasonable than the up to 90 hours a 
week he worked in private practice.

Spending up to 10 hours a day at a computer terminal typing in information 
for life-insurance applications, it was Feliberty’s job to decide if 
applicants’ medical history made them bad risks for coverage. Despite his 
numerous requests to his employers to modify his computer workstation to 
relieve the stress on his wrists and hands, he developed a condition that 
left him in persistent pain. Just 58, Feliberty is so disabled from his work 
at Kemper that he never returned from a disability leave and was fired by his 
employer (now Zurich-Kemper). Jobless and permanently disabled from carpal 
tunnel syndrome and reflex sympathetic dystrophy (muscle and nerve 
degeneration), Feliberty, a cardiologist, is suing his former employer and is 
effectively without a career. He is pressing a claim that his employer failed 
to provide reasonable accommodation as required by the Americans with 
Disabilities Act. The company said in a statement that it "declines all 
comment." 

Ironically, though, Feliberty is more aggrieved by the fact that his 
employer, doctor and insurer all secretly exchanged information on his 
medical condition as if he was the object of a criminal probe. Al-though 
under federal law such records are supposed to be confidential and can 
neither be used to make employment decisions nor even become part of a 
personnel file, Feliberty claims the information led to the cancellation of 
his disability-insurance coverage and his ouster from the company. 

What happened to Feliberty, who went from prized executive for a major life 
insurer to unemployable pariah in the space of less than two years, is being 
experienced by countless other Americans. They simply have the misfortune of 
becoming chronically or terminally ill, disabled or injured. Their medical 
records then are exchanged between health-care providers, insurers and 
employers, and the next thing they know, they are demoted, humiliated or 
fired. In the process, they become exiles in a system where health care is 
directly linked to employment. They are outcasts caught in a vicious circle. 
Most Americans who have health insurance receive it through their employers; 
coverage is an important job consideration, because without it, millions of 
us are a major illness away from financial ruin. But because our medical 
records can follow us with impunity from employer to employer, a chronic 
condition can make any of us unemployable—and thus uninsurable—in practical 
(if not always legal) terms.

Adrift between court dates and unsure as to how he will support himself and 
his wife, Feliberty’s medical records tell the tale—and still trail his every 
move as he seeks to get three out of four of his disability-insurance 
policies paid. No less than six doctors told him he would probably never 
regain normal use of his hands and wrists. His federal court case against 
Kemper was recently appealed and handed down to the federal trial court for 
rehearing. 

Feliberty and perhaps millions like him seemingly have become blacklisted by 
a system that uses medical history as a tool to prevent people from finding a 
decent livelihood and health care. And it doesn’t stop with those who suffer 
on-the-job injuries. Any worker who has ever filed an insurance or workers’ 
compensation claim, applied for health insurance or filled out a 
life-insurance form is scrutinized by this system. Once records are entered 
into insurance-industry-maintained databases or state worker-compensation 
programs, they become valuable documents for employers. 

Josephine Holzer, executive director of the Council for Disability Rights, 
asserts that "employers are getting rid of the employees costing them money 
[in insurance claims]." Her group has received more than 600 calls over the 
past five years from people who have been fired or demoted because of their 
disabilities. The most tragic part of this story, though, is that most 
employees often do not even know they are being discriminated against—it’s 
rarely disclosed to them that their medical history prevented their hiring or 
promotion. 

Little is known as to how many workers are affected and to what degree they 
are hurt by the too-open exchange of medical records between health-care 
providers and third parties. Feliberty’s ongoing lawsuit against his former 
employer is one of several in courts across the country. The hope of some 
justice and compensation is remote, however, for millions of others who are 
jobless and can’t afford the strain and expense of a prolonged legal battle. 

In the "self-insured" health plans in place at most large companies, your 
employer has complete access to your medical information. Company policies 
and state laws protect the confidentiality of your health records, and most 
firms undoubtedly play by the rules. But no single federal law protects 
medical-records privacy; it is covered in parts by the Federal Privacy Act 
(government-held health information), the Americans with Disabilities Act, 
several federal laws protecting mental-health and substance-abuse patients 
and a patchwork of state privacy laws.

Despite the crazy quilt of federal and state statutes, it’s clear that 
employers and insurers can obtain a wealth of medical information by simply 
making a phone call or sending a fax. The authorization form you sign for the 
employee health/life plan usually gives them open-ended permission to check 
your doctors’ and hospital records, workers’ compensation claims and even 
your credit record to see which health providers were billing you for 
services. There are also several national firms that will perform these 
"employment screening services" for a nominal fee—usually under $100 per 
employee. Several human-resources experts we interviewed said that employers 
or insurers usually have little trouble getting what they want when calling 
your doctor or hospital. Surprisingly, we inadvertently were faxed 
Feliberty’s four-page medical review from one doctor (in the process of 
confirmation), and we weren’t even asked who we were or why we wanted his 
records. The person answering the phone didn’t even ask to see a signed 
authorization form from Feliberty. 

If you have a job and apply for the company health and life-insurance plan, 
you are required to sign an authorization to release virtually all of your 
medical history to your insurer. With this form, you may unknowingly open the 
Pandora’s box of your medical history.

The Lack Of Federal Medical Privacy Laws Hurts Millions. Unfettered 
medical-records access hurts a large number of workers with a wide range of 
disabilities, injuries and illnesses. The Equal Employment Opportunity 
Commission (EEOC) has documented hundreds of cases where workers have been 
fired for easily treated and accommodated conditions such as asthma, back 
problems, cancer, depression, diabetes, heart disease and vision or hearing 
impairment. These cases, however, represent only a tiny percentage of the 
actual cases of disability discrimination that occur in the workplace. Most 
people who are the victims of discrimination don’t know about the EEOC or are 
unable to hire a lawyer on their own. The EEOC also routinely turns away the 
vast majority of complaints it receives. 

In an analysis of 162 disability-related employment discrimination cases 
handled by the EEOC in its most recent "docket" (law suits filed by the 
agency up to March 31, 1998), we discovered that more than half of the 
litigation involved workers who were fired by employers because they became 
disabled or injured (see charts on page 60). Some one-third of the complaints 
involved workers who were not hired because of their medical condition. 
Moreover, we discovered the following:

• Overall, more than one-fifth of the EEOC’s total complaints involve 
disability discrimination (22.5 percent in fiscal year 1997). 

• More than 40 percent of those cases we screened involving disability 
discrimination were connected to easily accommodated injuries or conditions 
such as back impairments, emotional/psychiatric treatment or neurological 
conditions. The rest of the cases were filed by workers with diabetes, heart 
problems, blood disorders and a number of other conditions. 

• There’s little question that the EEOC can’t keep up with the sheer volume 
of complaints, which number more than 80,000 per year. This relatively small 
agency also must administer and enforce the key laws regarding sex, racial, 
age, civil-rights and disability discrimination in the workplace. It’s an 
impossible task given the agency’s resources.

• Of the 3.8 percent of the employee charges that are pursued with 
"reasonable cause" (more than half are dismissed as not having reasonable 
cause), only 1.4 percent are resolved successfully, resulting in some $177 
million in monetary benefits for workers. The agency also has a huge backlog 
of charges—nearly 58,000 through mid-1998, down from 111,000 in 1995. So 
chances are good that even if the EEOC took your complaint to court, you 
would be waiting years for a decision. 

The EEOC information we obtained is but a tiny snapshot of the extent of 
disability discrimination in the workplace. Most of the cases the EEOC 
handles deal with a "failure to accommodate" and are either dismissed, not 
reviewed by the agency or resolved. The EEOC’s statistics, however, don’t 
tell how many people are discouraged from filing suit or simply not hired 
because an employer has screened their medical records. When the EEOC decides 
not to take an employer to court, it may issue a "right to sue" letter to the 
worker, which effectively tells you that the EEOC won’t help you, although 
you can hire a lawyer at your own expense. Although the lion’s share of cases 
initially reviewed by the EEOC may end in this decision, the agency doesn’t 
have or won’t provide any numbers as to how many. This is of little use to 
un- or underemployed workers who’ve lost a job or were never hired because of 
a medical condition or injury.

"Lawsuits are less likely to be brought by disappointed job applicants," 
observes Professor Mark Rothstein, a national privacy authority based at the 
University of Houston Law School. "But if employers can keep out employees 
with a potential for a six-figure health-care drain, they’re going to be 
tempted." 

Worse still, technology is making your medical records ever more transparent. 
With increasing computerization of medical records, anyone with access to a 
computer password (and sometimes not even that) can call up the most intimate 
details of your medical history and treatment. That’s what happened to Angela 
Retano, a 32-year-old special-education teacher who was working in a 
University of Pittsburgh clinic. She placed herself in treatment for an 
eating disorder and depression in the university’s hospital and received a 
surprise visit from two of her supervisors. She was stunned by their 
knowledge of her treatment and diagnosis, sensitive information that should 
have only been known to her treating physician. She said she felt compromised 
by their presence and their insistence that they be part of "her treatment 
team."

Retano, who has since sued the hospital and clinic, alleges that her 
supervisors illegally accessed her medical treatment and history through the 
hospital’s computer system. As a result, she claims two subsequent job offers 
were later rescinded by the university when her condition became known. Her 
supervisors are now countersuing for defamation. The university did not 
comment on the litigation.

"I was in a psychiatric hospital for treatment when my supervisors came in 
and basically told me I was a horrible person," Retano says. "It was so easy 
to pull up my medical records [from the hospital computer system] that I 
don’t want to see it happen to somebody else."

In recent years, insurers’ and employers’ need to obtain medical information 
has gone beyond intrusive, even becoming insensitive and humiliating. 

Insurance applications typically provide consent for the insurer to "obtain 
copies of records concerning advice, care or treatment provided to [you] 
and/or [your] dependents including without limitation information relating to 
mental illness, drugs or alcohol. Insurers are further authorized to use the 
resources of the Medical Information Bureau (MIB), a national database of 
health records maintained by health/life insurers and to disclose that data 
to other insurance companies and insurance support organizations. In a 
nutshell, most of your and your dependents’ health history could become part 
of a national database that any future insurer could access, and possibly 
share with an employer.

David Linowes, Ph.D., a University of Illinois professor who has studied 
privacy issues for more than 25 years, observes that "once companies get 
involved in administering health care, it’s tempting to use medical records. 
They can get all the medical information they want through [patients’] 
insurers, [who] obtain it through the MIB."

In response, Richard Coorsh, a spokesman for the Health Insurance Association 
of America, which represents major U.S. health insurers, denied that health 
insurers share their information or that of the MIB database directly with 
employers. With the increased use of managed care and corporate cost-cutting 
measures, however, employee medical information is now a prime commodity in 
this ongoing battle.

Open Medical Records Taint Health Care. There’s no one official survey of how 
most employers use employee medical information. Most employers probably 
handle it responsibly. It’s clear, however, that when medical files are 
judged by nonmedical decision-makers, it may set off a destructive chain 
reaction that pits the employee against the employer—with the worker losing.

Far too frequently, employees with treatable conditions or injuries who can 
be accommodated in the workplace are not hired, demoted, reassigned or fired 
outright. We found this pattern when we examined cases filed by the EEOC and 
major associations representing disabilities or chronic conditions. Worse, 
employees may not even report serious conditions—or may not report them to 
their insurer or employer through applications or insurance claims—for fear 
that this information will damage their careers or job prospects.

Denise Nagel, M.D., co-founder of the National Coalition for Patient Rights, 
notes that the medical-privacy problem has become so severe that many of her 
colleagues say that more than half of their patients choose to pay in cash 
for mental-health services over insurance reimbursement that is reported to 
their employers. This practice also tends to dissuade employees from seeking 
mental-health care in the first place because most cannot afford to pay for 
these services on a continuing basis. And when employees do file claims for 
mental-health disorders, a still-powerful stigma pushes employers to 
negatively judge medical conditions.

"I get calls all the time from people who claim they’ve been discriminated 
against by their employers but can’t prove it" says Nagel, who admits that 
few patients want to go public with their humiliation, and employers are 
unlikely to admit the abuse. Adds Rothstein, "A lot of what’s going on is 
potentially embarrassing and unlawful [on the part of employers]." Although 
no one has a complete picture of the crisis, a few snapshots are available 
that suggest widespread discrimination:

• An estimated 48.9 million Americans, or 19.4 percent of the population 
(noninstitutionalized), have a disability that interferes with common 
activities of daily living. That includes 7.2 million with arthritis or 
rheumatism, 5.7 million with back/spinal problems, 6.8 million with heart 
problems or high blood pressure, 2.8 million with lung/respiratory trouble 
and 1.6 million with diabetes, according to the U.S. Census Bureau. The EEOC 
records showed that workers have been either demoted or fired for having 
these conditions, resulting in lawsuits.

• Although many lawsuits or actions are not published, there are hundreds of 
lawsuits relating to job discrimination based on medical condition. The 
American Diabetes Association, for example, reports 44 federal and state 
suits pending that involve diabetes alone, which is treatable and easily 
accommodated by employers. Notes Mike Greene, director of legal advocacy for 
the association, "Many workers don’t want to tell their employer [about their 
diabetes] or lie about it because they’re afraid they won’t get the job."

• When employees are afraid to tell their employers about their medical 
conditions, they may also avoid treatment for those conditions or pay out of 
pocket. 

If employers and insurers make health records a fulcrum in employment 
decisions, the consequences are dark. Karen Shore, Ph.D., of the National 
Coalition for Mental Health Professionals and Consumers, says easily accessed 
medical records will "deter people from seeking treatment and prompt more 
misdiagnoses." Shore, a psychotherapist, asserts that employers are uniting 
with managed-care operations, and insurers are gathering mountains of 
information on patients in the interests of cutting costs. This information 
may be used to circumvent long-term treatment plans in every type of care. 
That means less care and may prevent doctors from providing the best-possible 
treatment. 

It’s rare for health confidentiality to be the subject of state or federal 
probes. But when it enters the public eye, it raises some troubling 
questions. Some two years ago, the Harvard Pilgrim Health Care plan, a 
managed-care organization in the Boston area, started a practice of entering 
detailed psychiatric notes into a computer system that could be easily 
accessed by a number of employees. Although the organization later said it 
would stop the practice, it led to an investigation by the Massachusetts 
attorney general.

Although few cases of mental-health-records disclosure are documented, "cases 
of [mental health] records abuse are popping up with some regularity," 
according to John Gates, M.D., director of the Carter Center Mental Health 
Program in Atlanta. "When most people sign disclosure [authorizations], 
health-care providers, processors [insurers] and researchers all have access 
to this information. And this information is being utilized for purposes for 
which it was not intended."

What Your Employer Knows May Hurt You. When it comes to your medical records, 
the dam holding back the reservoir of your health history burst a long time 
ago. Not only can your current employer gain access to details on past 
injuries or illnesses, your future employers can also get this data. This 
sensitive information is often easy to obtain and seen by pressing a few 
buttons on a computer.

Cynthia Ruoco, R.N., a 22-year-veteran nurse who was employed at Emory 
University in Atlanta, discovered how treacherous easy access to medical 
records can be in the Information Age. Although rated "excellent" in 
performance reviews by her employer, she suffered from clinical depression, 
which forced her to take a leave of absence in November of 1996. When a 
research trial she was working on encountered some difficulties, she started 
having conflicts with her immediate supervisor. Shortly thereafter, she began 
treatment for depression at the Emory Clinic. At that time, however, she was 
unaware that at least eight people were allegedly monitoring her treatment, 
including her supervisor, who was campaigning to fire her (and who later 
succeeded). Ruoco has filed an EEOC complaint and is suing the hospital and 
her supervisor for invasion of privacy and other related charges such as 
putting her medical records in her personnel file, an apparent violation of 
the Americans with Disabilities Act. The hospital had no comment on the 
matter.

"It took me two years to get back on my feet again," Ruoco says. "I went from 
driving a Mercedes to no car at all." As a result of the stigma of both suing 
her employer and having records indicating treatment for depression, Ruoco 
claims that now, "I have no career."

To what extent can employers gather information on employees through medical 
records? The scope of employment screening is so extensive that employers can 
track down medical records from decades ago and not even tell you that’s the 
reason you didn’t get a job.
Continued next e-mail