MedPriv-Bench: Benchmarking the Privacy-Utility Trade-off of Large Language Models in Medical Open-Ended Question Answering

Recent advances in Retrieval-Augmented Generation enable LLMs to ground outputs in clinical evidence, but connections to external databases create the risk of contextual leakage, where unique combinations of medical details enable patient re-identification without explicit identifiers. Existing healthcare benchmarks emphasize accuracy while overlooking this risk. To fill this gap, we present MedPriv-Bench, the first benchmark for jointly evaluating privacy preservation and clinical utility in medical open-ended question answering. Our framework utilizes a multi-agent, human-in-the-loop pipeline to synthesize sensitive medical contexts and clinically relevant queries that create realistic privacy pressure. We also establish an automated evaluation protocol using a fine-tuned RoBERTa-NLI model, which achieved an instance-level F1 score of 75.3%, sensitivity of 90.7%, and an average inference time of 0.056 s per sample against human annotations. Across nine LLMs and three privacy-preserving methods, we observed a pervasive privacy-utility trade-off. Relative to unprotected Med42-v2-8B (utility 3.87/5; leakage 72.8%), supervised fine-tuning improved utility to 4.25 and reduced leakage to 38.9%, whereas local differential privacy reduced leakage to 20.5% but lowered utility to 3.03. These results demonstrate the need for domain-specific benchmarks to validate medical AI systems in privacy-sensitive settings.