
Chinese insurer’s facial-recognition software offers a cautionary tale - pseudolus
https://www.bloomberg.com/opinion/articles/2019-06-14/china-knows-how-to-take-away-your-health-insurance
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tomxor
Yes this is horrible but... wont this inevitably self correct?

The further they go down this road, the more their acceptance criteria will
converge on insuring people that never need a payout. Once people clock onto
that fact, the insurance becomes worthless - At which point other insurance
companies will be able to come in and compete on a non-discriminatory basis
and operate on the principle of a tax that spreads cost rather than a gamble
that attempts to never actually deliver value to the customer.

... or you could just skip straight to an actual tax based health system and
cut out the profiteering middle man. Yes I like the NHS.

~~~
seanmcdirmid
China already has universal healthcare, it’s just not very good yet.

~~~
rqs
Universal healthcare? What does that mean?

In China, we only have one type of healthcare, the one that needs to be paid.
There is no healthcare for free here.

(Unless of course, you're a high ranking CCP party member, that way you can
enjoy all the goodies from all over the country for free, including free blood
plasma from young people* to keep you feel good when you're old. *Caution: HIV
maybe included due to technical difficulties).

~~~
seanmcdirmid
Technically we (and our employers) pay for it via payroll deductions from our
paycheck (the one labeled social health insurance? They then gave us a
healthcare benefit account (in my case linked to bank of Beijing). It was all
very useless, but technically China is listed as a country with universal
healthcare.

Never donate blood in China, unless you are forced to by your school/work
unit/whatever.

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devoply
Phrenology makes a hearty comeback this time with the help of AI.

Psychology based on the skull vs psychology based on the face and "micro-
expressions"

[http://www.victorianweb.org/science/phrenology/intro.html](http://www.victorianweb.org/science/phrenology/intro.html)

1.The brain is the organ of the mind.

2\. The mind is composed of multiple distinct, innate faculties.

3\. Because they are distinct, each faculty must have a separate seat or
"organ" in the brain.

4\. The size of an organ, other things being equal, is a measure of its power.

5\. The shape of the brain is determined by the development of the various
organs.

6\. As the skull takes its shape from the brain, the surface of the skull can
be read as an accurate index of psychological aptitudes and tendencies.

~~~
owens99
#4, 5, 6 are very dubious.

Elephants have huge brains yet they don’t rule the world.

~~~
dredmorbius
Other things aren't equal.

Brain size correlates strongly with body size.

Also: Phrenology is bunkum.

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joshuaellinger
BTW -- The author (Cathy O'Neil) is awesome.

This particular problem has always existed in insurance. The best way to make
a profit is to not insure sick people. I was hoping the cautionary tale was
that it didn't work for the insurer, rather than it being a ripoff for the
customer.

Digging a little deeper, it looks like their plan is to implement a
telemedicine+drug kiosk system at Chinese scale which is interesting. That
should work.

Their PR person claims they hit 80% 'positive' rate on detecting lies using
micro-expressions. Seems... unlikely. When the dust settles, it will probably
just turn out that that preventing people from lying about identity so you
can't escape your past has all the value and the rest of it is worthless to
the insurer.

[https://www.mobihealthnews.com/content/ping-good-doctor-
show...](https://www.mobihealthnews.com/content/ping-good-doctor-showcases-ai-
powered-unstaffed-clinics)

[https://www.forbes.com/sites/shuchingjeanchen/2018/06/06/chi...](https://www.forbes.com/sites/shuchingjeanchen/2018/06/06/chinese-
giant-ping-an-looks-beyond-insurance-to-a-fintech-future/#af5feab48f33)

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dredmorbius
The future resembles the past.

Dan Bouk, of Colgate University, is a historian of bureaucracy, including
insurance, which has a long history of discrimination:

 _His work investigates the ways that corporations, states, and the experts
they employ have used, abused, made, and re-made the categories that structure
our daily experiences of being human. His first book,_ How Our Days Became
Numbered: Risk and the Rise of the Statistical Individual _(Chicago, 2015),
explored the spread into ordinary Americans ' lives of the United States life
insurance industry's methods for quantifying people, for discriminating by
race, for justifying inequality, and for thinking statistically._

[http://www.colgate.edu/facultysearch/facultydirectory/dbouk](http://www.colgate.edu/facultysearch/facultydirectory/dbouk)

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nabla9
These systems can be extremely profitable even when they give massive amount
of false positives.

Example:

Without algorithm:

For every 100,000 customers true 1,000 positives. Each positive leads to
$1,000 payoff (on average). The cost is $10 per customer.

With algorithm:

For every 100,000 _potential_ customers the algorithm identifies 9,500 false
positives and 500 true positives. You reject these 10,000 customers. Now you
have 500 true positives for each 90,000 customers. The cost is $5.56 per
customer.

The end result of extensive customer profiling is that wrong friends in the
social media, wrong words, or any physical trait that has little correlation
with something cost incurring can increase the cost of your life.

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harry8
The AI Winter is coming. Are you strong enough to survive?

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tomrod
These are all great points.

1\. How can you expect the AI to determine liars?

2\. Risk pooling versus segmentation is bound to be controversial, especially
in health.

~~~
devoply
At the end of the day it's a con to bilk people out of more money or deny
insurance to those that they don't like or maybe they have some "secret"
stolen information that the person is a insurance risk.

------
Canada
It’s reasonable to charge fat people more. It’s something you can measure
objectively. It’s also something under your control.

The lie detector is just bunk though. If something is really a factor then
measure it or test for it objectively.

~~~
CapacitorSet
>It’s reasonable to charge fat people more.

It's only reasonable insofar as you view insurance as a profit-maker and
deprive it of its social function of financial relief.

~~~
logicchains
Not allowing insurers to charge people who engage in unhealthy behaviour is
effectively forcing people who make good health decisions to subsidize people
who make bad health decisions. From an economic perspective this has a
negative social function, incentivising bad behaviour and punishing good.

