Earlier this month, the Federal Trade Commission (FTC) sued GoodRx, a California-based company that offers discount coupons for prescription drugs. In its complaint, the FTC accused the company of violating federal law when it shared user’s health information – without notice or authorization – to Facebook, Google, and other advertising companies.
Millions of Americans have saved money on prescription drugs using GoodRx discount coupons. But in its lawsuit, the FTC claimed GoodRx was “unjustly enriched” at the expense of its customers who could face “stigma, embarrassment or emotional distress,” if their health conditions were disclosed.
“It is a very big deal that the FTC decided to file this case,” said Pam Dixon, executive director of the World Privacy Forum.
Dixon says the federal government used this case to send a message to the growing list of companies that collect personal health information, but are not covered by federal privacy laws (HIPAA). The FTC is putting them on notice that they face legal action if they sell or share health-related information without getting explicit permission from their customers.
“When most people share their health information online, especially if a website has a medical sounding name, most people assume that it’s covered under some kind of privacy law,” Dixon told Checkbook. “The truth is that for health privacy laws, those apply only to health care providers. The data is protected when it’s at certain businesses like a hospital, or a health care provider, or a pharmacy.”
Under the proposed settlement filed in federal court a few weeks ago, GoodRx agreed to pay a $1.5 million fine and to stop sharing health data with third parties for advertising purposes. That settlement must still be approved by the court.
GoodRx did not admit to any wrongdoing, and it disagreed with the FTC’s allegations.
In a statement the company said: “We are thoughtful and disciplined about what information we gather and how and why we use it. GoodRx said it agreed to the settlement “to avoid the time and expense of protracted litigation.”
More Info: FTC Charges GoodRx with Illegally Disclosing Customers’ Health Information
Herb Weisbaum, The ConsumerMan, is a contributing editor at Checkbook.org, a nonprofit organization with a mission to help consumers get good service and low prices. It does this by providing unbiased ratings, advice, and price information. Checkbook is supported by consumers and takes no money from the service providers it evaluates.
