Teladoc's Betterhelp Will No Longer Be Able To Share Mental-Health Data With Facebook Or Snapchat For Targeted Advertising Under A FTC Ban

According to the FTC, BetterHelp will have to reimburse consumers $7.8 million. The therapy program denied misconduct.

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After charges that the online counseling division of Teladoc Health mishandled client data over a three-year period, U.S. trade officials will forbid BetterHelp Inc. from sharing client data, including sensitive mental-health information, with social-media businesses.

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Teladoc's TDOC, +1.93% BetterHelp would also be obliged to pay $7.8 million to consumers as part of a deal with the Federal Trade Commission.

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The FTC said that BetterHelp shared private information with companies including Facebook and Pinterest Inc., both of which are owned by Meta Platforms Inc. Even though BetterHelp had vowed to keep such information private, PINS, +2.62% and Snap Inc.'s SNAP, +2.03% Snapchat allowed the companies to target advertisements to their clients.

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According to Trade Algo, this is the first time the FTC has taken action to reimburse individuals whose health information was exposed.

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According to the FTC, the monies would be used to partially repay customers who paid for BetterHelp's services between August 1, 2017, and December 31, 2020.

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The pandemic led to a surge in telehealth services, increasing Teladoc's revenue from $553 million in 2019 to $2.4 billion in 2022. BetterHelp was purchased by Teladoc in 2015 for $4 million.

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Also, BetterHelp operates under identities that aim to establish a closer relationship with specific clientele, such as Adolescent Counseling, Faithful Counseling, and Pride Counseling.

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Also, the ruling forbids BetterHelp from disclosing personal data for the purpose of re-targeting, which is the practice of displaying adverts to users who have already visited BetterHelp's website or used its app, even if they haven't signed up for the company's counseling service.

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In a statement, BetterHelp acknowledged that company had settled with the FTC but refuted any wrongdoing.

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According to the report, the advertising techniques utilized between 2017 and 2020 were "industry-standard" and "often used" by some of the biggest healthcare organizations, systems, and brands.

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To be clear, the business maintained it never shared sensitive information, such as member names or clinical data from therapy sessions, with advertising, publishers, social media platforms, or any other comparable third parties.