Since January, the Trump administration has rolled out policy after policy attacking the civil rights and well-being of LGBTQ+ students, immigrants, and students of color. The anxiety, depression and trauma wrought by these policies has been compounded by the terror campaign and occupation that families in neighborhoods across Chicago have experienced for the past six weeks. This is, of course, on top of all the other longer-term sources of stress impacting so many of Chicago’s children and young people.
Disturbingly, one of the resources that Chicago Public Schools (CPS) has directed families to in response to life under siege by federal agents is Hazel Health, a for-profit, mental health tech company. After a recent corporate merger, Hazel now has deep ties to the data-and-surveillance tech behemoth Palantir, “the corporate backbone of ICE that the agency is relying on for surveillance and deportations,”
In March 2025, Hazel Health began providing CPS high school students with counseling services under a no-cost contract with the school district. If students don’t have public or private insurance for Hazel to bill, United Healthcare underwrites these “free” services.
Hazel is a privately-held company with tens of millions of dollars in venture capital from firms like Bain Capital and Fiore Ventures, a fund founded by a Walton heiress. It has been rapidly expanding in recent years, and now has contracts in 180 school districts in 19 states.
As a privacy advocate and a CPS parent, I became concerned about Hazel when I first looked at the district’s contract with Hazel and found no information about what types of medical records or mental health data Hazel was collecting and holding—a requirement that parents fought successfully to add to our Illinois state privacy law, the Student Online Personal Protection Act (SOPPA), back in 2019.
Researching further, it was clear that the parental consent form that Hazel uses is filled with violations of that same state law. Parents must agree that their child’s identifiable data can be used for unspecified development and research purposes and that their child’s data may be “illegally accessed”. The webpage where parents sign their child up for services has marketing trackers from Google’s parent company and Amazon—also a violation of SOPPA.
Earlier this month, the advocacy group I lead, Illinois Families for Public Schools, sent a letter along with four other groups to the Chicago Board of Ed and our superintendent/CEO urging them to review the contract with Hazel before it automatically renews on December 31st, to fix any illegal provisions in the consent form and end the tracking of CPS parents and students on Hazel’s website.
After sending our letter, we learned that Hazel recently merged with another mental health tech startup, Little Otter. Little Otter has an AI-based platform and uses the data from its clients to train its algorithms. All of Little Otter’s therapy sessions are recorded, and it’s unclear whether content from those recordings is being utilized to train its algorithms.
Little Otter’s founder and CEO, Rebecca Egger, was recently featured in a profile of Palantir alumni who have now launched their own startups. Little Otter’s tech leads, including their previous CTO, COO and head of data engineering, are also all former Palantir employees. Little Otter still has close ties to Palantir as one of its “Global Builder” startups that use Palantir’s services and technology in their own products.
Palantir has been a federal contractor for many years, and is now playing a key role in the Trump administration’s plan to merge data across federal agencies. One of those agencies is ICE, and Palantir is a—if not the—major tech partner in the Trump administration’s mass deportation plan, which is being carried out by ICE.
Is data from CPS students’ online counseling sessions already being used to train AI algorithms? Will it be used that way in the future because of Hazel’s merger with Little Otter? Could recordings or transcriptions of teen’s counseling sessions eventually end up in a federal database? (The Chief Information Officer at the Department of Health and Human Services is also ex-Palantir.)
The issues that Hazel’s mental health services raise, however, are broader than just these deeply concerning and unanswered questions about students’ privacy.
Faced with cuts to federal funding for school mental health programs, Medicaid and other federal education dollars, it will be ever more tempting for administrators to sign up for any service marketed to schools as low-cost or free. But no matter how sympathetic they may be, an adult on an app (much less an AI chat bot) doesn’t know what happened yesterday in the cafeteria or around the corner from the school, evictions in the wake of gentrification-caused rent hikes, or angry parents targeting an inclusive literature syllabus. And a therapist in a remote office in another state can’t feel what it feels like to be a young person in Chicago today including wondering if a family member, a neighbor or they themselves could be apprehended by ICE—or beaten or tear-gassed for resisting—making their way to school in the morning or pulled out of their bed at night.
So, we—families, educators, and students, in Chicago and everywhere—must push back on “solutions” that purport to provide care, but in reality aim to replace human connection with commercial exploitation. Instead, we must demand for our schools the resources they need to educate and nurture all our children in an uncertain world during unstable times.
Cassie Creswell is the executive director of Illinois Families for Public Schools, a volunteer-led, grassroots, pro-public school advocacy group she co-founded in 2016. She has been advocating on public ed issues in Illinois since 2010, including funding, privatization, standardized testing, data privacy and governance. She is also a co-chair of the Parent Coalition for Student Privacy. She is the parent of a current student and a recent graduate from Chicago Public Schools.
