Labor leaves genetics loophole for life insurers

One of the last barriers to widespread genetic testing – discrimination against obtaining life insurance – remains in place despite a promise by the Albanese government to clear it.

Genetic tests give insight into an individual’s probability of developing certain diseases, and how heritable that aspect of them is. Picture: istock

One of the last barriers to widespread genetic testing — discrimination against obtaining life insurance — remains in place despite a promise by the Albanese government to clear it.

“I am getting multiple emails every week from clinicians, researchers and the public, asking me whether the law has changed and what the situation now is,” Monash University genomics researcher Jane Tiller says.

“Doctors don’t know what to tell their patients who are considering having genetic testing right now. I constantly have to tell people there is no legislation yet – the protection that’s been promised isn’t in place yet. People don’t understand the difference between the announcement and an actual change in law, and it’s creating all this uncertainty.”

Assistant Treasurer Stephen Jones announced in September the Labor government would legislate a ban on life insurers using genetic results to deny service or alter premiums, a practice that led many patients to avoid screening entirely.

Assistant Treasurer and Minister for Financial Services Stephen Jones championed a genetic discrimination ban on life insurers, though its future now looks unclear. Picture: NewsWire / Martin Ollman

“No Australian should be discouraged from undertaking testing out of fear it may impact their ability to get life insurance,” the minister’s announcement said.

“This decision places Australia as a world leader in removing barriers to genetic testing by stopping the use of adverse predictive test results in life insurance.”

But the policy is now in the political wilderness, with no legislation drafted, no further sittings of parliament this year, and an election looming early next year.

Genetic tests give insight into an individual’s probability of developing certain diseases, and how heritable that aspect of them is. It is largely unlawful to discriminate based on information in these tests, with one major caveat.

Risk-rated insurance, namely life insurance, is the one sector still cleared to change rates or refuse service based on someone’s predisposition to heritable diseases.

It’s why, through recent years, many patient groups, scientists, businesses and academics have made it their mission to protect patients’ genetic information from insurance companies.

Despite insurers holding themselves to a partial prohibition on the practice since July 2019, with its own caveats, insurance discrimination remains the largest factor in why patients avoid seeking out testing.

From more than 1000 submissions to Treasury’s consultation, 97 per cent advocated for a total ban.

Labor’s delay on the policy has particularly concerned teal independents, with North Sydney MP Kylea Tink questioning Mr Jones in Question Time in late November, and Goldstein MP Zoe Daniel writing to Mr Jones on behalf of her electorate.

Independent MPs Kylea Tink and Zoe Daniel have pushed for a ban. Picture: NCA NewsWire / Martin Ollman

“This (ban) makes absolute sense – people should be able to get tested for genetic conditions without fearing that if they do they, and possibly their family members, will be precluded from insurance,” Ms Daniel said to The Australian.

“I’ve written to the minister on behalf of affected members of the Goldstein community in support of this reform and urge the government to act quickly to deliver on its commitment.”

Law professor Margaret Otlowski leads the University of Tasmania’s Centre for Law and Genetics, and was impatient to see the ban instituted given its near-universal support.

“This delay seems to be more to do with a queue of work for the parliamentary draftsmen (The Office of Parliamentary Counsel). So it’s very frustrating,” Professor Otlowski said.

“There’s clear data that it turns people off having necessary genetic testing. It’s a public health issue that’s actually quite significant.”

Professor Otlowski argued there was a financial impetus for life insurers to spruik genomics.

“If people are encouraged to have genetic testing, they’re more likely to screen and identify issues early. They’re more likely to successfully have interventions or take precautionary steps,” she said.

“There will actually be a boost to people’s health and longevity, which will benefit insurers (once) the deterrent effect of genetic testing is removed.”

Contributing to the proposed legislation’s runaway popularity, Professor Otlowski argued, was its targeted nature, distinguishing it from the efforts of Canada and the UK to ban genetic discrimination.

The UK’s ban, which also began as a moratorium, has since become the Code on Genetic Testing and Insurance, a voluntary agreement between government and the Association of British Insurers.

Canada’s expansive 2017 legislation largely bans genetic discrimination in all goods and services, including insurance.

Monash University researcher Jane Tiller.

“Australia’s proposed ban is narrower because we already have legislation that broadly prohibits discrimination based on genetic status, which Canada did not have,” Professor Tiller said.

“When passed, this legislation will align life insurers’ insurance protection with health insurance, which is community rated — meaning health insurers can’t refuse cover or change premiums on the basis of any risk information, including genetics.”

While the details of the Labor legislation are not yet available, Mr Jones outlined the main intentions in his September announcement.

Life insurers would be barred from altering rates or refusing service based on the outcomes of genetic testing, regardless of whether or not it showed likely inherited diseases for a patient or their family. Life insurers would still be able to use family history or personal diagnosis of

disease in their underwriting, however.

He also confirmed the legislation would be enforceable by the industry regulator, the Australian Securities and Investments Commission. It would make the edict against discrimination a duty under insurers’ regulatory obligations.

Law professor Margaret Otlowski.

Geneticist Paul Lacaze. Picture: Alex Coppel

Geneticist Professor Paul Lacaze has been one of the most enduringly vocal supporters of a ban on genetic discrimination as a co-founder of the Australian Genetic Non-Discrimination Working Group, which convened researchers, clinicians, lawyers and ethicists to bring the issue onto the national agenda.

He argues that as genomics progresses through a process of “mainstreaming”, as he refers to it, we will see debate over the technology generally in parliament become far more frequent, and likely far more contentious. This has already been the case this year with life insurance.

“This has gotten genomics into the spotlight. There’s the actual practical benefit that it will lead to … but it’s also about the broader signal that it sends to society. We want to pave the way for the future for genomics, and we must address this barrier in relation to life insurance in order to do that,” he said.

Among these future issues of debate are rights to genetic data privacy, and issues of ownership over genetic material provided to medical corporations. In the future, the country may well face questions over the protections that must be in place as population-wide genetic information amasses, amid real concerns over the potential risk of biohacking.

“There’s millions of samples being collected, and there’s huge amounts of genetic information being stored, (and) it potentially could become a national security concern,” Professor Lacaze said.

“If a foreign actor could come in and access all of the country’s genetic profiles, they could potentially use it in nefarious ways, and maybe countries need to start thinking about that.”

Professor Lacaze said forensic use of DNA during criminal investigations, and the potential matching of those samples with large public databases, raised difficult dilemmas.

“Is that going to be legal and permitted? And is that potential acceptable to people who are signing up for a research study? Those kinds of issues are emerging as the scale of genomics gets bigger.”

But to Professor Lacaze, the argument on genetic discrimination by insurance companies was not “futuristic”.

“There’s lots and lots of future issues that are going to have to be dealt with, but … this particular one is not hypothetical,” he said.

“Life insurers should want more people signing up and staying healthy for a long time, rather than trying to exclude people from their market.

“But insurers of all types don’t necessarily think in the long term or (of) social good as their first priority. A lot of them think of how they can make the risk pool de-risked as much as possible so they can minimise the amount of payouts that they face.”

The question of how demand for genomic services will likely surge after the ban is instituted, is also far from hypothetical.

“It’s not necessarily about the service infrastructure, it’s about the reimbursement,” Professor Lacaze said. “There’s not enough funded testing for people versus the demand that’s out there already today,” he said.

“When this legislation comes through the demand will just go up even more. The only testing that’s reimbursed now is for people who have already had a disease, by and large. You have to have had a cancer and a strong family history to qualify for a genetic test in the federally funded … system. For anyone who wants to do proactive genetic testing, there’s no option for them other than to pay out-of-pocket.”

Access to out-of-pocket genetic testing services is also currently limited, given the lack of incentive for Australians to pay for a service that could later threaten the value of their life insurance.

Advocates have pushed for a nationally regulated screening provider to allow proactive testing, a preventive measure it is argued that would pay for itself generously in reductions to hospital presentations and prevention of treatable disease.

“We already had a pilot study funded to test 10,000 people in that way,” Professor Lacaze explained.

“Ten thousand people signed up on the first day we made it available, and 20,000 in the first three days. We had to turn all the advertising off because we were inundated.

“We have the infrastructure to actually do the testing. We can scale our labs to test tens of thousands and hundreds of thousands of people. It’s about the access and reimbursements of testing that doesn’t currently exist.”

Despite the study’s popularity, it did see a number of participants exit part way. When surveyed about their reasons, more than half cited fears of life insurance discrimination.

The government, meanwhile, maintains it has not given up on legislation.

“The Albanese government has announced we will ban the use of genetic tests to discriminate in life insurance underwriting,” a spokesperson for Mr Jones said. “The government intends to introduce legislation as soon as possible.”