Data spill in California shows risk of online health files

Until recently, medical files belonging to nearly 300,000 Californians sat unsecured on the Internet for the world to see. There were insurance forms, Social Security numbers and doctors' notes. Among the files were summaries that spelled out, in painstaking detail, a trucker's crushed fingers, a maintenance worker's broken ribs and one man's bout with sexual dysfunction. At a time of mounting computer hacking threats, the incident offers an alarming glimpse at privacy risks as the nation moves steadily into an era in which every American's sensitive medical information will be digitized. Electronic records can lower costs, cut bureaucracy and ultimately save lives. The government is offering bonuses to early adopters and threatening penalties and cuts in payments to providers who refuse to change. But there are not-so-hidden costs with modernization.