I work for an international staffing company and that question is included on one of our hiring documents. I can only speak for how we do things in our office, but once the form is filled out and answered, I literally file it in a drawer where no one ever sees it again. As I understand, it is so that if there is ever a labor dispute with our client (the company we hired you for), we can pull that up to show that the applicant had an opportunity to disclose. Our particular form lists a number of potential disabilities, then you choose which answer best applies: "Yes, I have a disability", "No, I don't have a disability" or "I prefer not to answer". Applicants are asked to please not disclose any personal medical information, it is just a simple "yes" or "no" question.
As a person with PsA, though, I admit that I would be scared to mark a box for fear of earning a label. How would you ever be able to prove that your disclosure didn't affect the hiring decision?