I recently signed into a medical-related service that used a verification system like this.
They asked three questions. All of which were multiple choice and populated with a lot of obvious wrong answers.
Two of them were the year and model of a car I (no longer) leased, and one was a direct "what county do you live in?" which is trivial from the address.
If you physically drove by my house any time when the garage door was open in the last three years, you had a decent chance of knowing the right answers. If you had access to the DMV records, you had the right answers. And on the flip side, I hate to imagine how this would have worked for, say, a scholarship student at age 20 with no credit file.
Enjoy reading my lab test results. I feel so secure.
That said, given the equifax breach, I literally can't think of someone I'd trust less to handle it.