Privacy Crackdown Complicates US Health Industry’s Marketing Services

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A recent federal data privacy crackdown has complicated how health care companies market their services online.

A report states that, the Federal Trade Commission has led the way in the new enforcement push, fining telehealth companies for violating their customers’ privacy and barring them from doing so in the future. The director of HHS’ Office for Civil Rights said her staff has launched its own investigation, calling online health data collection “problematic” and “widespread.”

That’s upending longstanding business practices and sending the health care industry scrambling. Firms are in some cases cutting ties with tech giants like Google and Facebook as they try to understand the regulatory landscape and measure the fallout to their bottom lines.

For consumers, health care industry experts said, the shift offers more privacy, but could also make it more difficult to find primary care, mental health and other medical services online.

“Legal and compliance teams … are telling the marketing team that these tools are dead men walking, you need to shut it off immediately,” said Ray Mina, head of marketing at Freshpaint, a San Francisco firm that provides software to health care firms for managing customer marketing data.

The backdrop for this new concern is a rising trend of Americans receiving information or services from mental health apps, telehealth services and hospital websites. People may not know these services are capturing detailed personal information that is then used for marketing and advertising.

Now, as regulators set new limits on how this data is used and shared, Mina said clients have swamped his firm with questions about what data it’s collecting and with whom it is sharing it. So Freshpaint has to ensure it doesn’t run afoul of the regulators.

In the first three months of 2023, telemedicine firms spent a quarter of what they did on targeted Facebook and Google ads during the same period last year, according to data from MediaRadar, an ad industry intelligence platform. Meanwhile, MediaRadar data shows non-profit health systems also halved their spending on targeted ads during that same three-month period year-over-year.