Medical identity theft is a rising threat in America, with millions of cases reported every year. It is a form of fraud that occurs when someone uses another person’s Social Security Number, date of birth, and other private information to obtain medical services or products.
Often, the medical charges get passed on to the unsuspecting victim.
Medical identity theft can occur after petty theft of purses or wallets containing health insurance cards, or it can happen as a result of online hacking and theft of personal data. Either way, staying vigilant and reporting thefts or suspicious activity can help you protect yourself from fraudulent claims and charges.
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Medical Identity Theft Definition
What is Medical Identity Theft?
Medical identity theft is the act of taking someone else’s identity to access medical goods and services. Examples include using a driver’s license and health insurance card to visit a doctor or using fake prescriptions and ID cards to get prescription drugs.
This can cause incorrect information to end up on your medical record, affecting future care. In some cases, having false medical conditions on your record can cause a doctor to give you an incorrect diagnosis or make a life-threatening error. For example, you could end up with the wrong blood type or allergy information in your file.
In extreme cases, a thief can use your identity to get elective surgeries or pay for extended hospital visits, resulting in a large bill being sent directly to your mailbox. Depending on how quickly the bill was noticed, it may take months of fighting debt collectors and filing complaints with credit agencies to get the charges resolved.
If your ID is used to obtain opioids or other controlled substances fraudulently, you could even end up under criminal investigation. This can also take months to resolve as you and a lawyer try to piece together enough evidence to clear your name.
In some cases, thieves use your information to access Medicaid and Medicare fraudulently. Though the government is the primary victim, in that case, you could still be charged for certain bills, and it creates major headaches for you as you clear the fraudulent records and try to keep it from happening again.
How does it occur?
Stolen purse or wallet
Medical identity theft occurs when someone obtains your ID cards, Social Security number, or other private information about you. This can happen after your purse or wallet is stolen from your car, vehicle, or home. In some cases, thieves might even be able to pull private information from documents like medical bills.
Medical identity theft can also occur if someone hacks an account belonging to you or a system where your private information is stored. If you keep copies of your driver’s license, taxes, or medical insurance information on your computer, that information could also be compromised if a virus or other malware infects your computer.
Black market selling
Once thieves have your ID numbers or copies of cards, it may take them or an associate several weeks or months to register for medical insurance or get medical care. Sometimes stolen data is sold on the black market, where another set of criminals begin to use it.
A lot of movement to different medical institutions
Some thieves go to great lengths to keep from being caught. If they use several different pharmacies or hospitals to get care, it can take months or years for the fraud to be discovered.
It can be especially hard to detect if the thief is covering the co-payments themselves at the time of service, and the insurance covers the rest. In that case, the fraud is usually not detected unless the victim closely examines their Monthly Explanation of Benefits from their insurance company.
Medical identity theft statistics
Case comparison of 2000 and 2014
Medical identity theft first emerged as a problem in the mid-2000s. By 2014, an estimated 2.3 million cases of fraud were occurring every year. Though the exact methods vary widely, recent corporate data breaches have likely contributed to medical identity theft.
In 2017, the World Privacy Forum released a report showing that America had seen a significant spike in medical fraud over the previous ten years. Florida and other southeastern states had seen particularly sharp increases.
Various data and investigations suggest that instead of being isolated incidents of petty theft, sophisticated crime rings are buying more patient information on the black market.
How to protect yourself from medical identity theft
1. Medical Identity Theft Insurance
The best way to protect yourself against medical identity theft is to get medical identity theft insurance. This insurance is designed to cover any fraudulent expenses someone incurs in your name. Though some medical insurance companies include this coverage, many do not, or require victims to meet very high standards to qualify.
Other consumer identity protection systems are often not designed to monitor medical identity theft or might not notify you of medical expenses until it’s too late.
When shopping for consumer identity theft protection, ask what specific measures they have regarding medical identity theft. You should be able to register your health insurance ID number with them so they can notify you of suspicious activity.
Review your medical insurance billing statements, Explanation of Benefits, and other documents carefully. If there are any documents from your insurance company or doctors that contain records you don’t recognize, contact the provider right away to see if they made a clerical error or if someone has used your account fraudulently.
2. File a report
File a police report anytime you are a victim of theft, even if you don’t think there was anything valuable in the purse or wallet. Report a lost medical insurance card to your insurance company immediately. They may be able to assign you a new ID number or take other measures to keep your insurance from being misused.
3. Shred Medical Documents
You can help prevent medical identity theft by shredding sensitive documents, especially medical bills or anything that includes medical ID numbers. Dispose of tax documents securely, as they have your Social Security Number printed at the top of each page. If you must send your tax documents to someone, redact your SSN from every page.
4. Report fake medical phone calls
Some of these may be legitimate, but others are scams that will abuse your information. Ignore and report any phone calls that claim to be from your insurance company and ask you for your ID number, as these are definitely scams.
5. Use strong and random passwords
Take care when sending information through online systems. Make your passwords as long as possible, use capital letters and punctuation, and don’t reuse passwords on different sites. If a medical provider or government agency needs a copy of a document, hand-deliver it to them, or mail it directly, instead of sending it via email.
Medical identity theft is even more difficult to identify and fix than credit card fraud or financial identity theft since many medical services are covered by insurance with only a small co-pay.
Medical identity theft is on the rise in America, so consumers of all ages and with all types of health insurance should take extra precautions to prevent it from happening to them.
Reporting theft and suspicious activity, investigating unusual medical bills, and using long passwords to secure online accounts can help protect you against medical identity theft. Shredding sensitive documents and avoiding sending information electronically can also reduce the risk of fraud via theft or hacking.
However, medical identity theft insurance is the best way to safeguard your information and prevent fraudulent bills. Though some standard medical insurance includes this, victims must often jump through many obstacles to use it. A good credit monitoring service will include medical identity theft coverage to protect you and your family.
Remember, medical identity theft can take months or years to resolve, especially if it wasn’t caught right away. Debt collectors or even law enforcement may pursue you, even if the situation is entirely not your fault. Get the best medical identity theft protection you can and take whatever precautions you need to combat this new threat.
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