Why are privacy and confidentiality preconditions for good medicine, not just personal preferences?

Because they are preconditions of autonomy and of treatment quality: if patients had to assume that everything they tell their doctor is passed on, they would confide much less, and diagnosis and treatment would suffer.

• People need an unsupervised private space; privacy and confidentiality are preconditions for being able to act autonomously.
• They also matter for the quality of treatment. A patient who expects disclosure withholds information: about drug use, sexual health, mental health. The doctor then treats an incomplete picture. Even a multi-bed hospital room where others can overhear has this effect.

The two principles that protect this space in a digital system are informational self-determination (the person decides about disclosure and use of their data, with rights to information, correction, export, withdrawal and deletion) and contextual integrity (data shared may only be used according to its original purpose).

So privacy here is not opposed to good care; it is one of its working conditions. That is also why doctor-patient confidentiality is protected by professional secrecy law.

Go deeper:

• Stanford Encyclopedia of Philosophy: Privacy and Medicine — why confidentiality matters for patients and for care.
• Wikipedia: Physician–patient privilege — the legal protection of what patients tell their doctors.