Health and life insurers companies have access to a powerful new tool for evaluating whether to cover individual consumers: a health “credit report” drawn from databases containing prescription drug records on more than 200 million Americans, The Washington Post writes.

Collecting and analyzing personal health info is poised to take off as the nation enters the age of electronic medical records. While lawmakers debate how best to oversee the shift to computerized records, some insurers have already begun testing systems that tap into not only prescription drug info, but also data about patients held by clinical and pathological labs.

Traditionally, insurers judge an applicant’s risk by gathering medical records from physician offices, but the new tools are “electronic, fast and cheap,” Mark Franzen, managing director of Milliman IntelliScript, which provides personal drug profiles to insurers, tells the paper. Millman and Ingenix, a health information services company, say the drug profiles are an accurate, less expensive alternative to seeking physician records, which can take months and hundreds of dollars to obtain.

But the practice also illustrates how electronic data gathered for one purpose can be used and marketed for another - often without consumers’ knowledge, privacy advocates say. And they argue that although consumers sign consent forms, they effectively have to authorize the data release if they want insurance, the Post writes.

“As health care moves into the digital age, there are more and more companies holding vast amounts of patients’ health information,” Joy Pritts, research professor at Georgetown University’s Health Policy Institute, tells the paper. “Most people don’t even know these organizations exist. Unfortunately the federal health privacy rule does not cover many of them…The lack of transparency with how all of this works is disturbing.”

Here’s the rest…