Will Insurers Drop Health, Life, and Disability Insurance Thanks to Consumer Genetic Testing?

Arthur L. Caplan, PhD


October 08, 2018

Hi. I'm Art Caplan. I'm at the Division of Medical Ethics at the NYU School of Medicine. Has anyone received a direct-to-consumer genetic test for a Christmas or birthday present? With many of these tests, you can find out medical information and a little bit about your ancestry. Certainly, many patients and other people in the public are using these direct-to-consumer genetic tests. There are the 23andMe tests and AncestryDNA tests, and many other companies that offer these insights into the genetic risk factors of disease.

Normally, critics—and I am sometimes critical of these genetic tests—complain that the tests aren't very accurate. Critics also argue that, for many people, finding out they're at risk for a particular disease isn't very meaningful because there isn't anything they can do about it. In other instances, the test results may scare people because they overinflate risks for diseases that are so rare that it isn't worth worrying about; they're ultra-rare diseases that most people will not develop.

There's a different angle on genetic testing of this type that raises questions for the future about how to handle who undergoes genetic testing and who needs to know the results. Genetic testing has some protection of privacy in law, including statutes like HIPAA. The Affordable Care Act has protections governing genetic or inherited disease; so does GINA, which is the federal legislation that governs what can be done with genetic testing information.

At the federal level, none of these laws cover disability or life insurance. Recently, some companies that sell life insurance, long-term care, and disability insurance policies have communicated concern that people are going to use these direct-to-consumer genetic tests; find out that they are at risk for serious, common diseases; and then purchase those forms of insurance.

For the most part, when it comes to thinking about protections, we don't want patients to be harmed by being unable to find a job or health insurance. However, the other viewpoint is that they may be able to use information from direct-to-consumer genetic tests to buy more health, life, or disability insurance.

Economists call this adverse selection, which puts insurance companies at grave risk because they're trying to get a large enough pool of people so that they're not only trying to sell long-term care or disability insurance to people who are likely to use it; the companies are spreading the risk.

The idea behind this is that people really don't know if they're going to need the insurance, which makes the whole economic case viable. With genetic testing, however, patients and their families may be able to undermine these insurance markets, which would mean the end of disability, life, and other forms of insurance.

We have something else to think about as we roll forward into our genetic future. It's great to find out your health risks. As the tests improve, it will be possible to learn what your child might have, or even your fetus or baby, in terms of risk factors.

However, this knowledge will have serious implications for the way we currently make life, health, disability, and long-term care insurance available. Politicians and the medical community need to start thinking about those challenges now.

I'm Art Caplan, at the Division of Medical Ethics at NYU School of Medicine. Thanks for watching.


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