A 1998 incident in which patients' prescription information was used to adv
ertise anew drug exemplifies the importance of confidentiality in the era o
f managed care and computers. The ethical concerns voiced about this incide
nt can also apply to pharmacy benefits management programs. The use of pers
onal health information in pharmacy benefits management is particularly imp
ortant because of increased pressures to control rising drug costs. Specifi
c confidentiality concerns include whether the goal of benefiting patients
will be achieved and whether the means are appropriate. The means may be pr
oblematic because of financial conflicts of interest, lack of patient autho
rization, inappropriate access to information by third parties, and inadequ
ate safeguards for confidentiality. Policies should be crafted that protect
confidentiality while allowing appropriate use of personal health informat
ion in pharmacy benefits management. Sound policies should require clear ev
idence of benefit to patients, an oversight committee, patient authorizatio
n, disclosure or prohibition of conflicts of interest, additional safeguard
s for sensitive medical conditions, strong confidentiality protections, and
restrictions on advertising.