Consumer Law

Medical Identity Theft

By M. Stan Herring

Our friend Denise Richardson has posted an article about the growing concern of medical identity theft. In 2007 more than 250,000 people reported being victims of medical identity theft, which is even harder to correct than kinds of financial identity theft.

Richardson links to a New York Times Article that discusses how medical identity theft happens.

...someone can use stolen insurance information, like the basic member ID and group policy number found on insurance cards, to impersonate you ? and receive everything from a routine physical to major surgery under your coverage. This is surprisingly easy to do, because many doctors and hospitals do not ask for identification beyond insurance information.

Even more common, however, are cases where medical information is stolen by insiders at a medical office. Thieves download vital personal insurance data and related information from the operation?s computerized medical records, then sell it on the black market or use it themselves to make fraudulent billing claims.

Sometimes employees in a medical office stealing information will sell it or use it themselves and file fraudulent claims.

In a widely reported case in 2006, a clerk at a Cleveland Clinic branch office in Weston, Fla., downloaded the records of more than 1,100 Medicare patients and gave the information to her cousin, who in turn, made $2.8 million in bogus claims.

Fraudulent claims can result in an exponential amount of unpaid balances, but can also be physically dangerous. The victim's medical information may have been amended to list different allergies, surgeries and medications that are not the victim's. This can be especially dangerous because it impacts future medical treatments.

Privacy laws work against the victim once the theft is discovered, in that the thief's medical records are also considered to be confidential, even though they are intermingled with the victim's. This makes the problem exceptionally hard to fix, since the victim is not technically supposed to see the other person's records.

If you have had problems with identity theft, feel free to contact us.

Full post as published by Alabama Consumer Blog on August 21, 2009 (boomark / email).