That sounds like leprosy. This happened in Morrowind, you could catch like 4 diseases and four plagues. Diseases are easy to cure, plagues had to be cured by a healer. Though the disease never really travelled in Morrowind, I would love to see tons of people getting sick ingame. In UO everyone hung out at Brittain Bank, so if it were in that game, diseases would travel fast, it would be awesome.