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    New York Times: Revelations by AOL Boss Raise Fears Over Privacy

    The New York Times reports on fears about medical privacy amid the controversy over AOL CEO Tim Armstrong discussing two “distressed babies” and their connection to his company’s decision to cut employees’ benefits.

    Tim Armstrong, the chief executive of AOLapologized last weekend for publicly revealing sensitive health care details about two employees to explain why the online media giant had decided to cut benefits. He even reinstated the benefits after a backlash.

    But patient and work force experts say the gaffe could have a lasting impact on how comfortable — or discomfited — Americans feel about bosses’ data-mining their personal lives.

    Mr. Armstrong made a seemingly offhand reference to “two AOL-ers that had distressed babies that were born that we paid a million dollars each to make sure those babies were O.K.” The comments, made in a conference call with employees, brought an immediate outcry, raising questions over corporate access to and handling of employees’ personal medical data. […]

    In response to a query about how Mr. Armstrong learned the specifics of the AOL employees’ situations, Doug Serton, a spokesman for AOL, said, “We aren’t commenting on these issues.”

    The uproar over the “distressed babies” remark comes at a time of increased public dissatisfaction with employers whose efforts to hold down health care costs appear to some employees to cross the line into invasion of privacy. Last fall, Pennsylvania State University introduced a wellness plan that required employees to answer a lengthy questionnaire about their health and private lives, or pay a fee of $100 monthly; after faculty members protested, the university said it would suspend the fine. […]

    Legal experts said that if Mr. Armstrong was not authorized by the plan document to see the employee data he publicly discussed, it could constitute a violation of disclosure regulations.

    “It’s likely an impermissible disclosure,” said Lisa J. Sotto, a lawyer in New York who specializes in data privacy and security compliance. “There is a permissible group that is pinpointed to administer the health plan, and they are not permitted to disclose that information” outside specified purposes.


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