Medical Identity Theft

Getting a hospital bill for $30,000 can be scary and upsetting, but medical identity theft involves a lot more than financial burdens created by someone who uses your personal information to get medical care. Medical fraud is one way that identities are abused by thieves, and the real danger is not the long term financial problems it can create, but the life threatening consequences it can have on an innocent patient.

Of the many faces identity fraud has, medical identity theft is the deadliest one. Your medical records could end up with the wrong medical history and diagnoses and these are the things that can cause serious problems for you when you do need medical care.

The majority of cases of medical fraud involve criminal rings that often work with corrupt medical staff, who even include doctors. They purposely file false claim’s with the insurance information of unsuspecting victims. Some of these rings are so well organized for this type of crime that they can even setup fake clinics. The medical billing system is complex and confusing for most people, but for medical staff that know how the system works, this is all too easy.

This type of identity fraud can be very lucrative, continuously setting up fake claims can produce millions of dollars a year and now that most medical records are electronically archived, this presents even more opportunity since now thieves can steal millions of records at once. After all the damage is done and the victim realizes that their records are wrong, they will have a very frustrating time correcting these entries, which in many cases remain on medical records permanently.

Dangers of a wrong diagnosis

If you’ve been a victim of medical identity theft, you’re immediately in danger, especially if you are not even aware that your medical records have been wrongfully altered. This could mean a life threatening diagnosis for you.

Imagine being given a medical prescription for medicine that you’re allergic to, or being denied treatment because your records show that you were already treated for a specific condition you’re now developing and the medical facility considers you a liability because of what’s on your record. What if you were told your recent xrays are keeping you from getting new xrays that you need in order to find out what’s wrong with you? What if you needed surgery and couldn’t get it because according to your medical records you’re currently recovering from a previous surgery?

These are only some of the instances in which medical identity theft can complicate and threaten your life. The consequences go on and on and even if your life is not threatened by the changes in your medical record, the financial problems you’ll face can certainly make you sick.

Medical insurance fraud costs millions of dollars every year, and if you become a liability to your medical insurance company you can also be dropped. Your medical benefits could be exhausted if someone else impersonates you and uses your information to make their claims. Insurance companies have policies for dealing with fraud and most will work with you to investigate the fraud, but if your benefits continue to be abused you could end up with no benefits.

Identity theft protection and medical fraud

Identity protection services became available as a way to combat the ongoing epidemic of identity theft crimes, which in the majority of cases still refers to credit fraud. But there are so many ways to take advantage of another person’s identity that these services make a lot of sense. Even though they have great security features to stop identity theft, their services still have not fully responded to the threat of medical identity theft. Not every identity theft protection service offers medical benefits protection and the few that do, offer only limited protection measures to prevent this threat.

For now the only company we have discovered that offers medical benefits protection is Trusted ID, the service basically includes periodically reviewing and monitoring medical services provided to the subscriber to make sure no one else other than the designated subscribers are receiving medical care.

In order to prevent medical insurance fraud and the problems it can create for subscribers, the protection offered by these companies needs to improve significantly. They can effectively stop identity theft when it comes to credit accounts and can even detect your social security number floating around black market websites on the internet, but because medical identity theft is more complex, it’s a bigger challenge to tackle it as well as credit related crimes.

In spite of these deficiencies, the services are still a great way to outsource the tasks of monitoring your identity. It’s no doubt that these services are improving and innovating to provide better protection and monitoring your medical benefits usage maybe exactly what you need to keep yourself safe from medical identity theft.

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.

Medical identity theft and health care fraud are serious crimes in the U.S. Much like getting your credit card number or name and address taken and used by someone else for their own benefit, having your “medical identity” stolen an abused has the same consequences in terms of financial burdens but it is a lot more serious in terms of your medical record being altered with someone else’s information.

Medical identity theft happens when someone uses your personal information to get money, prescription drugs, and medical care in your name. This type of identity theft creates a lot more than financial hardship, it changes your medical history and enters new diagnosis records and prescriptions that could end up endangering your own life.

Medicare fraud is basically the same thing, however this applies to medical benefits afforded to individuals by the federal or state governments and this can also have the same consequences in that if Medicare realizes that you have been using these benefits when you do not yet qualify for them you could be held liable. All a thief needs is your social security number to apply for these benefits.

Medical fraud can be committed by anyone who can’t otherwise afford to pay for any medical attention. The law does not require medical facilities or their personnel to be experts at verifying information that is rendered before they extend medical services, in most cases no verification process is in place to make sure that the person getting medical care is in fact who they say they are.

One of the reasons why your medical identity ends up in the wrong hands is because medical clinics and facilities do not really have strict security measures in place to protect your personal information. Medical insurance fraud is often the work of criminal rings that dupe or bribe clerks into volunteering this information, which is now in electronic form and much easier to transfer.

Why medical fraud is lucrative

The criminal rings that farm this information sell it for a profit, these types of operations make credit card fraud look like shoplifting candy. These are multi million dollar operations that cater to ex-cons, undocumented workers, and anyone who’s willing to pay for the information that can afford them medical care. Your information may also be traded via online financial black markets.

The consequences of health care fraud and abuse

To begin with, you could end up being canceled or suspended by your health insurance carrier once they detect that your account is at risk of fraud. Your diagnosis records change permanently and in most cases it is basically impossible to correct the entries, and this can pose a serious danger to your life if you’re given the wrong diagnosis when you seek treatment. You could also end up with a medical bill for which you never actually received treatment but are expected to pay in full. This would typically happen if your health insurance does not cover the treatment that the thief got or if your benefits were exhausted in the process.

How to protect against medical identity theft

• Only share your health insurance information with trusted sources.
• Be aware that phishing scams may also target you for your medical insurance information.
• Monitor and read your explanation of benefits from your health care provider and get quarterly summaries from your carrier that describe all the benefits you have used so far and detect any discrepancies.
• Keep copies of your medical records in case you need to prove something in a dispute.
• Check your credit report often, if there are any medical leans against you, they would be recorded there.

Your medical records are in many different places especially if you’re older and have a long medical history. So it would be very impractical to try and monitor each of the sources that have your information especially if you have had several health insurance carriers throughout your life. There are only a handful of identity theft prevention services that can monitor your health insurance benefits and protect your identity from medical identity theft, Trusted ID is one of them. Outside of outsourcing and automating the process through identity theft protection services, there isn’t much on the individual level that you can do to make sure your medical information remains filed safely.

The point of employing these services is so that the responsibility of monitoring and verification of your information is passed to an entity that is technologically equipped to detect and stop unauthorized medical transactions from taking place in your name. Fraud prevention services have evolved quickly bringing forth a lot of great security features due to the dire need to monitor medical records and prevent health care fraud and abuse from occurring to hard working individuals.