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The Federal Trade Commission cited privacy as a key focus — and reason it needs more funding — in its 2024 budget request released Tuesday.
The agency has become increasingly aggressive against companies that trade in sensitive consumer health data, with recent enforcement actions against digital health companies GoodRx and BetterHelp, including multimillion-dollar settlements.
The FTC seeks to further increase its scrutiny over healthcare by increasing its ability to take on larger and more complex cases, both to protect consumer privacy and to crack down on it anti-competitive Healthcare consolidation, the agency said.
“Additional staff will enable the agency to investigate and process increasingly complex matters, such as those affecting data protection,” the budget proposal reads.
The FTC’s proposal calls for a $160 million increase in funding for fiscal 2024, which would increase the budget by 37% compared to 2023. The proposed total budget of $590 million would help the agency hire more than 300 additional employees, the proposal said.
The increase is necessary because significant merger activity, signs of market concentration and related competitive concerns have “dramatically increased” pressure on the FTC’s resources in recent years, the budget request said. FTC Chair Lina Khan said in an interview with CNBC last year that the agency is “severely” understaffed and understaffed.
The FTC has devoted more of its resources to protecting sensitive medical information since last summer’s Supreme Court decision overturning federal abortion rights.
In the wake of the controversial ruling, bans on the procedure emerged in dozens of conservative US states, and fears grew that health data could be used to prosecute those seeking the procedure in states where it is illegal. Digital records such as text messages, browser histories, and emails have historically been used to track pregnancy-related criminal charges.
The FTC has filled the loophole in US consumer privacy laws by stepping up action against companies that collect and share sensitive information from users. Just months after the Supreme Court decision, regulators sued data broker Kochava for selling geolocation data from hundreds of millions of mobile devices that could be used to track people, including to and from sensitive locations like reproductive health clinics.
In February, the FTC banned GoodRx — best known for offering discounts on prescription drugs — from sharing users’ health data with third parties for advertising purposes after regulators found the company had been monetizing that data for years. GoodRx also agreed to pay a $1.5 million fine.
Regulators also banned psychiatric company BetterHelp from sharing consumer data with advertisers earlier this month. BetterHelp, a subsidiary of telemedicine giant Teladoc, allegedly shared users’ sensitive medical information with advertisers like Facebook from 2013 to 2020. BetterHelp was fined $7.8 million.
And collecting, analyzing, and profiting from Americans’ intelligence may soon become even more difficult. The FTC proposed a rule last summer to enact stronger privacy protections by further cracking down on companies that collect and sell consumer data.
The FTC has also been active in challenging healthcare mergers, which it considers anti-competitive. In 2022, regulators decided to block three healthcare system mergers, resulting in all parties abandoning the proposed deals, according to the budget motion.
The mergers that failed as a result of the FTC are Lifespan and Care New England in Rhode Island; HCA and Steward Health Care in Utah; and RWJBarnabas and St. Peter’s Healthcare System in New Jersey.
The proposed budget for 2024 “reflects the continued growth of our investigative and litigation capabilities to meet increasing, broad-based demand anti-competitive Challenges in the healthcare and technology markets,” says the budget proposal.
But historically, the agency doesn’t get as much as it asks for. Last year, the FTC requested a $139 million increase in its funding but received only a $53 million increase, resulting in a total budget of $430 million in 2023.