Medical ID Theft – The New Threat to Your Privacy, Health, and Finances

Identity theft, an on going threat to everyone’s privacy and finances, has resulted in numerous calamities for hundreds of thousands of citizens. Many safeguards have been instituted to stop its spread but it continues. And now a new ID theft has surfaced which presents even more serious problems. Medical identity theft, the new id theft problem is growing at an alarming rate. Daily 1000’s of accounts of privacy, health and finances improprieties, as a result of medical identity theft, are reported.

Medical identity theft can create life-threatening problem, especially for senior citizens. For this reason, local and federal law makers are considering drafting legislation which will make the criminal punishment for medical id theft far more harsh than current id theft laws. New proposed laws will go beyond just slapping hands and firing employees. New laws are to include significant fines and sentencing the guilty party to substantial jail time. It is important to announce medical id theft will not be tolerated with a stricter message to deter this type of crime.

Like standard id theft, medical identity thieves steal the victims name, insurance information, and Social Security Number and use it without its real owner’s knowledge. Medical ID identity thieves have the potential to endanger not only the victims finances, but their health as well as they utilize the stolen information to get medical services, obtain fraudulent prescriptions, or, more commonly, to apply for credit.

Over the past ten years the economy for personal information has really matured. The institutions which had the most to lose from the negative reports about wide spread id theft, like banks and online merchants started doing a much better job of protecting data.

Today’s identity thieves go where the cap on resistance is the least and where the financial opportunities are the greatest. Consumers’ medical insurance information is their new venue and electronic medical records are the in road they use to take advantage of this new opportunity. Individual medical information is quickly becoming as valuable as their financial information counter part,” according to Scott Mitic, chief executive officer for TrustedID, an identity theft protection company.

According to market research firm Javelin Strategy & Research new report, data theft related to exposure of medical records rose in one year more than 100%, from 3% in 2008 to 7%, or 275,000 cases, last year.

Once in the hands of these crooks, there is no shortage of ways the hijacked medical information can be put to use. In a number of cases, employees with access to this personal information steals patient credit card information and go on shopping spree. Other cases, involve obtaining and falsifying prescriptions for abuse and resell and more seriously, use of a stolen identity to submit bogus claims to insurers and falsify medical records to support those claims.

“In situations where the intention is to defraud the insurance companies, the medical id thieves are usually more sophisticated individuals who are part of a networked effort. But the origin of the information theft usually remains low-tech and originates from person-to-person communication,” Mitic added.

Seniors, who generally use health care services more frequently, and may not be as aware of identity theft risks, have been the most likely victims of medical identity fraud. Their lack of knowledge of this fraud also make them more susceptible to the deceptive persuasion used to obtain their personal information.

A recent Medicare phone scam conducted in several states targeted elderly consumers by pressuring them to divulge personal details on the pretext they were being issued new Medicare cards. An official sounding organization calls on the phone saying they are updating the victims Medicare data information prior to issuing the new card.

One Medicare scheme, reported in the New York Daily News, involved a 72-year-old woman from Grahamsville, NY. She learned she had become the victim of medical ID theft when she began receiving strange insurance bills. The paperwork showed Medicare had been billed, in her name, for a pregnancy test, a prostate exam, semen analysis, and other medical services she had not had performed. Bureaucratic hurdles prevented her from stopping the fraud, despite that she repeatedly called Medicare to alert the agency. At the end of her three-year ordeal with Medicare, the total fraud in her name amounted to close to $50,000.

Consumers most be vigilant to prevent medical ID theft, both proactively and re actively. All information, including medical insurance information, Social Security information, dates of birth and PIN numbers should be treated equally valuable and never shared unless you are thoroughly familiar with the source you are giving it to. It is important that you check your medical benefits statements as diligently as you do your credit card statements. Also be aware you have the right to request an annual disclosure record from their insurer and do so. Medical id theft is growing. In the wrong hands, this information has the potential to endanger not only your finances, but your health.