It looks like the purple defringing is not set properly for the image.
Looking at the JPG with EXIFtool, the purple defringing Amount value is quite high, and the purple defringing range (Lo and Hi) is quite wide:
Defringe Purple Amount: 19
Defringe Purple Hue Lo: 19
Defringe Purple Hue Hi: 96
Defringing works by desaturating a range of colors, so try setting the purple defringing Amount to 0 to see if the issue resolves, then adjust the values more conservatively.
If you are unaware of the purple defringing, entirely, it is in the Manual lens corrections area, and perhaps you have set your camera-raw defaults improperly, with aggressive defringing amounts. The defringing is probably something that should be zero as a default, and set, per image, where it doesn’t extend into normal image details.
Thank you very much!!! The problem did indeed disappear when the CA correction slider was set to 0. I had never seen this behavior before though - huge parts of the face and hands on another photo turned grey! But much better now (still hoping for a more robust CA correction algorithm one day).
The example photo had Defringe values were set too extreme for the picture content. Here is a lynda.com video that shows how to back things off based on what you see on screen:
Images should initially be opening with zero Amount values for Defringing. This is how my defaults are:
If not, then reset your camera raw defaults to the factory defaults:
After doing this, then if you really want something different than the factory defaults, open a new image, set those values and use the Save New Camera Raw Defaults item just above.