Nope, I know 100% it sends the record off to the government server and then when a location has a reported case, they call you using the info they have. Know the guy who built the system and he says while the data is encrypted in the db, the government also has the key to access everything.

Its also partly about the precedent it sets. Its now becoming required to carry a phone around with you and hand over more of your data without any opt out.