Most of us think of identity theft as a financial crime, but one type-medical identity theft-can have consequences that go beyond impact to your wallet and your good name. If someone steals your insurance information or tampers with your medical history to make fraudulent claims to your insurer, both your insurance coverage and your health could be seriously compromised.
Medical identity theft occurs when someone else abuses your insurance information for his or her benefit. Most often this happens when someone-all too often a family member-steals your identity and uses your insurance to obtain health care services, prescriptions, or medical devices without paying for them. Other scenarios include abuse by crime rings stealing identities in order to submit fraudulent claims to insurers, Medicare, or Medicaid, or even insider fraud by employees of a physician or medical center who falsify records by adding diagnoses and treatment to patients´ records without their knowledge in order to submit fraudulent claims and pocket the payments.
A Stolen Identity That Could Be Life Threatening
The consequences of financial identity theft are bad enough, but a medical identity theft carries the extra danger that errors in your medical file could lead to a misdiagnosis or mistreatment when you seek medical care in the future. Even if changes to an individual´s medical records are not a deliberate part of the thief´s scam, they may nonetheless be the result.
As more and more of your health care providers and insurers use technology to track and maintain your medical history, it becomes increasingly likely that diagnoses, treatments, and prescriptions will become part of your medical file even if provided by someone other than your usual physician.
Because doctors diagnose illnesses and recommend treatment plans in a holistic fashion, taking into account the patient´s overall medical history, existing prescriptions, etc., it is possible that erroneous information in your medical file could have a meaningful impact on your health. Illnesses might be misdiagnosed, delaying appropriate medical treatment, or effective treatments might be rejected based on incompatibilities with conditions or prescriptions that are not actually yours.
Medical Identity Theft May Rob You of Insurance Coverage
Among the most common consequences of medical identity theft are temporary or even permanent losses of insurance coverage for the victim. A recent Ponemon study found that nearly half of all medical identity theft victims lose insurance coverage as a result of the crime, and over half must make out of pocket payments to insurers or health care providers to restore coverage that has been suspended. Nearly a third reported increased insurance premiums after the fraud.
Victims may be denied coverage for specific procedures based on inaccurate information in their files or because an identity thief has used up their annual benefit for a certain type of health care service. Victims may also be denied any coverage at all by an insurance plan they believe is in full effect because a thief has drained away the lifetime cap on their policy. And even if these issues can be resolved, denials of coverage may delay needed medical care and bring extra stress to a patient or family already dealing with an illness.
Medical ID Theft Is Tough To Detect On Your Own
The structure of most insurance plans means you´re unlikely to learn of a medical identity theft until long after it occurs. Doctors´ and pharmacies´ fees are often billed directly to the insurer, so a medical identity thief can rack up big bills using a stolen identity without triggering any warning signs for the victim. In fact, research suggests that most victims of medical identity theft don´t find out about it until they receive a collections notice for bills the insurer has denied or discover mistakes in their medical files, usually at least a year after the crime occurs.
How Can You Protect Yourself?
If your wallet is lost or stolen, make sure your insurer(s) are among those notified.
Read carefully all medical bills and insurance statements you receive.
Be on the lookout for fees from health care providers you do not recognize or statements describing benefits paid out for services you did not obtain.
Consider an identity protection service like ProtectMyID™, which will help you detect most kinds of identity theft, including medical, much earlier than you might on your own and assist you through the fraud resolution process if your information is stolen.
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