The FTC is taking legal action against Hims & Hers for disclosing patients' health information to Meta and Snap.

      The Federal Trade Commission is taking legal action against Hims & Hers, alleging that the telehealth provider improperly shared customers' sensitive health information with advertising companies like Meta and Snap. The complaint, submitted on July 29 and supported by Utah and California, further claims that the company billed individuals without their explicit consent and made it intentionally difficult to cancel subscriptions.

      The privacy accusations are particularly severe. The FTC asserts that Hims & Hers disclosed customers' health information to third-party advertisers through uploaded customer lists and automatic tracking that reported user activities to these platforms, resembling how hospital websites have inadvertently revealed patient data despite assurances of safeguarding it.

      The data in question is significant, as Hims & Hers offers treatments for topics that are often considered private, such as hair loss, erectile dysfunction, and mental health, making any alleged leaks to ad platforms especially sensitive. Hims & Hers has emerged as a prominent telehealth entity within these categories and has expanded into weight-loss medication, creating a subscription model that has transformed stigmatized prescriptions into a mainstream online business, highlighting the sensitivity of the data involved.

      Alongside the privacy issues, there are billing concerns. The FTC states that customers were charged as soon as they completed an intake form, despite the company suggesting they would have a conversation with a provider first, and they were automatically enrolled in recurring subscriptions without a clear opportunity to review their options.

      The challenge of cancellation was also significant. Prior to 2023, customers had to contact customer service via phone, email, or chat to cancel, and even after Hims added an online cancellation option, the FTC claims they obscured the cancel button behind several steps, a classic example of dark patterns that the agency has been actively pursuing online.

      The FTC's comments were direct, indicating that consumers were “unknowingly locked into recurring subscriptions” while their “most private health information” was shared with third parties, according to Christopher Mufarrige, the FTC’s director of consumer protection.

      The legal framework involves multiple laws. The complaint is based on the FTC Act, the Restore Online Shoppers' Confidence Act, and both consumer protection and false advertising laws from Utah and California, making it a multi-faceted case rather than just a single charge.

      The market responded immediately. Hims & Hers’ shares dropped approximately 10% following the announcement, reflecting investor concerns about the lawsuit posing a genuine threat to a company that has thrived on seamless online sign-ups.

      This legal action is part of a broader scrutiny of the health and wellness sector, as regulators have been investigating services that discreetly transmit sensitive data to advertising platforms. Given its scale and the intimate nature of its offerings, Hims & Hers is a prominent target.

      While Meta and Snap are not named as defendants, they factor into the case. The disputed tracking mechanisms involve the advertising pixels and data channels integral to much of the online ad industry, and the issue of health data being funneled into these systems has become a frequent legal point of contention.

      The existing legal gaps contribute to the issue. Federal health privacy laws were designed for hospitals and insurers rather than advertising-supported applications, permitting sensitive data to be shared with platforms in ways that patients often do not comprehend.

      The dark-pattern allegations may resonate broadly, as difficult-to-cancel subscriptions are a well-known source of consumer dissatisfaction, and the FTC has prioritized addressing these issues. Hence, a case that links privacy violations with hard-to-find cancellation options is one that the agency aims to win in the public eye.

      Hims & Hers did not provide a comment in response to the FTC's announcement. The company has rapidly expanded by making telehealth as convenient as ordering products online, and the lawsuit claims that some of that convenience came at the cost of the customer.

      The commission unanimously voted 2-0 to proceed with the filing. The case is now set to be heard in federal court in northern California, where the focal points will be whether the data sharing violated legal standards and whether the processes for signing up and canceling subscriptions crossed the line from aggressive practices to deceptive ones.

      For a sector predicated on convenience, the implications are clear. Telehealth has promised to eliminate barriers to accessing care, and the FTC is now examining how much of that convenience has been shifted onto customers, adding friction on their side.