Within the next few years, it should become fairly easy and inexpensive to get a rough-and-ready readout of your own genetic code, one that you can scan for information on which diseases you’re most likely to contract, which drugs will help you the most, and ultimately even how your children might turn out. In other words, a brave new world of genetic transparency is on its way, one that promises to empower individuals to an extent that’s still difficult to grasp. (For some preliminary thoughts on that subject, see here, here and here.)
At the same time, there is a persistent, if not growing, fear that individual genomic information will be available to insurance companies, who would undoubtedly use the information to restrict coverage for those with “bad” genes — or even to deny it altogether. Anyone who doubts the bedrock economic incentives that drive such insurance decisions should take a look at Jonathan Cohn’s terrific book Sick — not to be confused with the Michael Moore movie of similar name.
This fear is the primary driver behind the Genetic Information Nondiscrimination Act, which would bar insurers and employers from discriminating on the basis of genomic information or services. GINA, as the bill is affectionately known by its supporters, passed the House by an enormous margin earlier this year, but is currently held up in the Senate by an obstreperous Oklahoma senator, even though President Bush has pledged to sign it. (There’s more info here, here and here.)
Assuming GINA eventually passes as expected, what happens as personal genomics turns into a reality? One main consequence is that insurance companies suffer, because suddenly consumers will — for perhaps the first time ever — hold an information advantage over them. Say your own genome scan shows that you’re not predisposed to cancer, heart disease or diabetes — you might very easily opt for a low-cost, high-deductible healthcare plan that wouldn’t have to do much more than cover you in the case of an unexpected accident. By contrast, if you find you’re particularly likely to develop early-onset Alzheimer’s disease, as you enter middle age you might not only load up on health coverage, but also pick up a long-term care plan to ensure you’re not a burden to your family.
These sorts of informed choices cost insurers money, because their business model assumes that people will buy insurance they don’t need in order to subsidize the costs of those who do end up needing it. (That’s the fundamental logic of insurance, not a critique.) Extrapolate this far enough forward and it basically leads to the death of both health and life insurance, neither of which can survive without some pooling of risk — however much that’s been undermined by insurers’ recent willingness to slice and dice their applicant populations into profitable and unprofitable segments — and fundamental uncertainties that prevent individuals from cherry-picking the policies they buy. Insurers will doubtless try to devise proxies for genetic information, a prospect envisioned in this recent Economist article, but given that GINA outlaws insurance discrimination even based on the knowledge that someone has taken a genetic test, it’s difficult to see how effective such measures could be — although they might be very successful in spawning a new wave of ill-will against insurance companies.
I’m not about to shed crocodile tears over the plight of insurance companies, not least because the evidence that they’ve brought any sort of efficiency to the healthcare system is so thin on the ground. The possibility of their impending demise should at least give us pause, though, in part because so few Americans have given much thought to what ought to replace the private-insurance system.
Of course, the government is likely to rush in to fill any void, and in my view that’s not such a terrible outcome, since at least it’s big enough to spread risk properly across the entire population. (Genomics only minimizes risk — it doesn’t eliminate it.) And there’s still the question of what to do with those who’ve drawn bad numbers in the genetic lottery, for whom government support may be the only answer.
Others, of course, will likely disagree, although I’d point out that ideas such as the Economist’s preferred notion of “health savings accounts” — in which you’d save for future healthcare costs the way you save for retirement — seem unlikely to work terribly well when a single unexpected medical crisis can wipe out a family’s life savings. That means startups like Red Brick Health — also touted by the Economist — probably aren’t going to do the job, either. While this all may seem like far-off speculation to many, chances are good that we’re all hurtling into an uncomfortable (but not necessarily bad) new world far faster than we realize.
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