Widespread collection and use of identifiable information can promote social goods while, at the same time, infringing on personal privacy. Information systems are developing within the context of a fundamental transformation in the organization, delivery, and financing of health care. Changes in the health care system include rapid development of employer-sponsored health coverage, managed care organizations, and integrated delivery systems. These complex, multifaceted arrangements for delivering and paying for health care require ever-more-sophisticated information systems that facilitate extensive sharing of personal data. Systemic flows of sensitive health information occur both vertically and horizontally among employers, hospitals, insurers, laboratories, and suppliers. Beyond this complex web of vertical and horizontal sharing are the multiple demands for information management, quality assurance, research, governmental regulation, and public health. Theoretical problems exist with the law and ethics of informational privacy. The traditional method of exercising control over personal health information is through informed consent. Informed consent, however, within a modern health information infrastructure becomes highly complex. In this kind of environment, the doctrine of informed consent is flawed and does not provide sufficient control over personal information to assure adequate protection of privacy.