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FTC says health apps must notify consumers about data breaches — or face fines

·2-min read

The U.S. Federal Trade Commission (FTC) has warned apps and devices that collect personal health information must notify consumers if their data is breached or shared with third parties without their permission.

In a 3-2 vote on Wednesday, the FTC agreed on a new policy statement to clarify a decade-old 2009 Health Breach Notification Rule, which requires companies handling health records to notify consumers if their data is accessed without permission, such as the result of a breach. This has now been extended to apply to health apps and devices — specifically calling out apps that track fertility data, fitness and blood glucose — which “too often fail to invest in adequate privacy and data security,” according to FTC chair Lina Khan.

“Digital apps are routinely caught playing fast and loose with user data, leaving users' sensitive health information susceptible to hacks and breaches," said Khan in a statement, pointing to a study published this year in the British Medical Journal that found health apps suffer from “serious problems” ranging from the insecure transmission of user data to the unauthorized sharing of data with advertisers.

There have also been a number of recent high-profile breaches involving health apps in recent years. Babylon Health, a U.K. AI chatbot and telehealth startup, last year suffered a data breach after a “software error” allowed users to access other patients’ video consultations, while period tracking app Flo was recently found to be sharing users’ health data with third-party analytics and marketing services.

Under the new rule, any company offering health apps or connected fitness devices that collect personal health data must notify consumers if their data has been compromised. However, the rule doesn't define a "data breach" as just a cybersecurity intrusion; unauthorized access to personal data, including the sharing of information without an individual's permission, can also trigger notification obligations.

"While this rule imposes some measure of accountability on tech firms that abuse our personal information, a more fundamental problem is the commodification of sensitive health information, where companies can use this data to feed behavioral ads or power user analytics,” Khan said.

If companies don't comply with the rule, the FTC said it will "vigorously" enforce fines of $43,792 per violation per day.

The FTC has been cracking down on privacy violations in recent weeks. Earlier this month, the agency unanimously voted to ban spyware maker SpyFone and its chief executive Scott Zuckerman from the surveillance industry for harvesting mobile data on thousands of people and leaving it on the open internet.

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