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Understanding And Preventing Medical ID Theft

posted by Winthrop Cashdollar

on August 30, 2017

Two-thirds of medical identity fraud victims suffer a loss of more than $13,000. The ill-gotten gains of identity fraud – including medical identity fraud – are an important source of funding for criminal activity, such as drug, human, and weapons trafficking. These were among the alarming facts shared by representatives of the Medical Identity Fraud Alliance (MIFA) and the Federal Trade Commission (FTC) during an audio conference hosted by AHIP.

Medical identity fraud is the use of stolen protected health information (PHI) for financial gain or to unlawfully obtain medical goods or services. In addition to the person whose identity has been stolen, victims of medical identity fraud include health care providers, insurers, taxpayers, and consumers who, because of medical identity fraud, pay more for their health coverage and care.

Medical identity fraud is growing, warned MIFA Executive Director Ann Patterson. A MIFA study found the number of adult-age victims of medical identity fraud in the United States reached 2.3 million in 2014 – an increase of nearly half a million victims from 2013.

Some of the ways medical identity fraud can endanger patients include corrupted medical records, misdiagnosis and mistreatment, and legitimate health plan claims denied. Children and the elderly are especially vulnerable to medical identity fraud – and the consequences of the fraud can follow victims for many years, reappearing at times much like a disease that has been in remission, Patterson said.

Although internet technology has been a boon to fraudsters, medical identity theft is still often a crime committed by the victim’s friends or family. A lost or stolen wallet or stolen mail can all lead to medical identify theft.

Why is medical identity information so valuable? It’s because fraudsters can quickly use the stolen information – everything from name, DOB, Social Security Number to driver’s license, payment information, and information about family members – on the dark web, explained John Krebs, an attorney with the Federal Trade Commission’s Division of Privacy and Identity Protection.

Both Patterson and Krebs called for greater collaboration and information sharing on the part of public and private sector health care stakeholders. For resources that help victims recover from stolen IDs and can aid stakeholders in fighting identity theft and fraud, visit www.identitytheft.gov.

Winthrop Cashdollar is executive director of Product Policy at AHIP.