Goodrx fined for sharing health data of customers
In a first-of-its-kind enforcement, the Federal Trade Commission has imposed a $1.5 million penalty on telehealth and prescription drug discount provider Goodrx Holdings Inc. for sharing users’ personal health data with Facebook, Google and other third parties without their consent.
Under a settlement, California-based Goodrx also accepted that it will be prohibited going forward from sharing user health data with third parties for advertising purposes, the FTC said. Goodrx admitted no wrongdoing and said in a blog post that it settled “to avoid the time and expense of protracted litigation.” The agreement is pending federal court approval.
Consumer protection advocates hailed Wednesday’s announcement as a potential game-changer that could seriously curtail a little-known phenomenon: The trafficking in sensitive health data by businesses not strictly classified as health care providers.
“Digital health companies and mobile apps should not cash in on consumers’ extremely sensitive and personally identifiable health information,” Samuel Levine, head of the FTC’S Bureau of Consumer Protection, said in a statement. “The FTC is serving notice that it will use all of its legal authority to protect American consumers’ sensitive data from misuse and illegal exploitation.”
The enforcement is the first under a 2009 law, the Health Breach Notification Rule, which applies to personal health record vendors and related providers not covered by HIPAA, the federal privacy rules that govern the health care industry,
It comes three years after Consumer Reports discovered that Goodrx was sharing people’s personal health information with more than 20 companies. “People told us they’d never expected that their sensitive information was being shared with the likes of Google and Facebook,” Marta Tellado, president and CEO of Consumer Reports, said in a statement Wednesday. “This is a win for consumers, and it could have a profound effect on how our health information is kept private moving forward.”
In a legal complaint filed on the FTC’S behalf, Justice Department lawyers said Goodrx’s actions had “unjustly enriched” the company at the expense of users — many sufferers of chronic health conditions — who could face “stigma, embarrassment or emotional distress” as well as discrimination if facts it shared were disclosed.
Goodrx said the focus of the FTC’S concerns was “proactively addressed” nearly three years ago, before the FTC inquiry began.
Justin Brookman, the director of technology policy at Consumer Reports, said he believed the FTC inquiry began after his organization’s report on Feb. 25, 2020. Prior to that, the government said, “Goodrx had no sufficient formal, written, or standard privacy or data-sharing policies or compliance programs in place. And, even after Goodrx’s practices came to light, it failed to notify users that their health information had been disclosed without authorization.”
Company spokeswoman Lauren Casparis said via email that Goodrx “used vendor technologies to advertise in a way that we believe was compliant with all applicable regulations and that remains common practice among many websites.”
Those technologies included embedded web beacons known as “pixels” and other tracking and data-collection tools from companies including Google and Facebook, the government said.