Medical identity theft is one of the most dangerous forms of identity fraud, the consequences created for the victim are overwhelming and in many cases permanent. The health care system does not seem to have a hold on the battle against medical fraud, in most cases patient identity verification is not only inadequate but it’s downright criminal.

Patient information is traded daily on many online illegal sites and this is typically the work of identity theft rings and scammers who make a handsome living from stealing and trading personal information like credit card numbers, social security records and health care records. How do these medical identity theft scams occur? How can someone’s information leave the confines of a medical facility and end up for sale somewhere on the internet?

In many cases these are inside jobs, medical care employees may be tempted to capture and farm patient information with the intention of selling it to identity theft criminal groups or trade it themselves. The information is then used to create fraudulent medical billings. Medical identity theft involves more than just someone using your medical benefits as if they were you.

The scams that surround medical identity theft

Bogus treatment billing – with the aid of dishonest health care employees, medical identity thieves can bill your health care provider for fake or inflated treatments. In many cases the people responsible for these acts are not even criminal gangs or outside people, but doctors and their staff who understand exactly how the insurance billing system works and are very aware of the discrepancies of the security and verification process when rendering services and producing billing statements.

Purchasing of legal narcotics with your health benefits – whether a criminal group or medical staff initiates this, your health care benefits can be used to purchase prescription drugs to sell or often feed addictions. Any kind of controlled narcotic substance can be billed to your insurance company without you even suspecting.

Getting free medical treatment – people who do not have their own medical benefits can receive medical treatment under your policy if they possess the needed information. Again the identity verification process is poorly done by health care facilities and the law does not require them to be experts in this area. When this happens the victim’s life is endangered because someone else’s medical history is now being recorded onto theirs.

Additional steps to prevent medical identity theft?

In our introductory article on The Truth About Medical Identity Theft, we listed some basic steps for protecting against this crime, here are some additional steps that everyone should practice routinely.

One thing you can do on your own is to review your medical benefit statements often, if your health care provider does not automatically send you statements about your benefits and how they’re being used, then ask for a statement if not monthly, at the very least quarterly.

Any letter or notification you receive from your health insurance you should open and read immediately, it is here where they may be bringing to your attention the use of specific treatments for conditions you do not suffer from. If you are being notified of a treatment or service you did not receive, you must dispute immediately.

Always shred old medical statements and old insurance cards, if your insurance card has your social security number on it, make a copy of it cut out the last four digits of your social security number, this way you can always use the copy for reference and take the actual card with you only when you need it.

Check you credit report diligently and as you check for any discrepancies and invalid credit account, look for anything related to medical costs, this would be a sign that your name has been used for medical services somewhere.

When you receive letters or bills from health care providers, doctor’s offices or other medical institutions, do not dismiss them as junk mail. These could be clues that your information has been used to start medical services.

If you do discover that your information has been used for the purpose of obtaining medical benefits illegally, you must report this to the credit bureaus and place fraud alerts on your credit files just as you would if your credit card number was being used.

Identity fraud and identity theft protection are an ongoing and ever changing task. In the case of medical fraud there aren’t many things that subscribers can do on their own to protect against it besides the tip mentioned above. What goes on within medical facilities and who has access to your information is in fact out of your hands so you must resort to a more sophisticated system of protection if you’re to avoid medical fraud.

Not every company that offers identity theft protection has medical identity theft prevention features available as well. This is more complicated task when it comes to identity theft and needs to be approached differently than credit and social security related thefts.

Companies that offer medical identity theft protection

Trusted ID is the only company we have found so far that specifically lists medical benefits protection as part of their identity theft protection system called ID-Freeze. This company can help you review your medical benefit statements to ensure that you and your family are the only ones being treated with your medical benefits. It can simplify the task if you use your medical benefits often.

More companies will be listed here if they truly cover you for medical benefits in the future.