By Randy Hutchinson
President of the BBB of the Mid-South
Reprinted from The Jackson Sun
Resolving financial identity theft is a hassle, but can usually be accomplished at little cost to the victim and with no lasting impact. Medical identity theft is far more difficult to recover from, can cost victims a lot of money, and could have a disastrous impact on their lives.
Medical identity theft occurs when someone uses your personal information to submit fraudulent claims to Medicare or another health insurer. For example:
- Someone uses your information to obtain medical procedures with the bill sent to your insurer.
- Someone uses your information to buy medical equipment or prescription drugs.
- A health care provider submits fraudulent insurance claims in your name.
In a 2015 study, the Ponemon Institute estimated that 2.3 million people had been victims of medical identity theft in 2014, a 21.7 percent increase over 2013. The FTC reported a 101 percent increase in 2019 over 2018. Ponemon estimates the economic impact is over $41 billion annually.
Victims of financial identity theft are generally protected from monetary loss. The Fair Credit Billing Act limits their liability in fraudulent use of their credit card to $50 and issuers rarely even collect that. Ponemon found that 65 percent of medical identity theft victims spent an average of $13,500 to resolve the crime. That included legal bills and, in some cases, paying healthcare providers or repaying insurers for the services obtained by the thief.
The impact on a victim’s life can be even more serious. Consumer Reports tells the story of a lady who was arrested two years after her purse was snatched for allegedly acquiring more than 1,700 prescriptions for opioid painkillers through area pharmacies. The thief had used her health insurance card and altered driver’s license to get the prescriptions. A judge dismissed the charges, but it took five years to get the drug arrest expunged from her record.
In another case, a pregnant woman used another woman’s information to get maternity care at a hospital. After the infant was born with drugs in her system, the authorities assumed the woman whose identity had been stolen was the mother and threatened to take her own kids away. She had to take a DNA test to prove her innocence.
Signs that you may be a victim of medical identity theft include:
- A medical bill, Explanation of Benefits, or Medicare Summary Notice showing services you didn’t receive.
- A call from a debt collector about a medical debt you don’t owe.
- Medical collection notices on your credit report that you don’t recognize.
- A notice from your health plan saying you reached your benefit limit.
- Denial of insurance because your medical records show a condition you don’t have.
The BBB offers these tips for protecting yourself from medical identity theft:
- Guard your Social Security number, insurance information and other personal information.
- Don’t provide information in response to an unsolicited contact of any kind.
- Read bills and summaries of charges paid by Medicare and insurers to be sure they’re legitimate.
- Shred medical-related documents before discarding them.
- Check your credit reports annually to be sure there aren’t any fraudulent medical collection accounts.
You need to protect your information even from people you know. In Ponemon’s survey, 47 percent of respondents said the identity thief was a relative or other acquaintance.