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Learn the effects of medical identity theft and what you can do to help your consumers mitigate the risk of fraud.
Every year, the Federal Trade Commission compiles a list of the top consumer complaints. For more than a decade straight, identity theft has topped the list. The crime can cost a consumer thousands of dollars, and the damage can follow a victim for years. But there’s one version of the crime that’s particularly dangerous – most consumers don’t even know it exists.
On average, medical identity theft can cost a victim $20,000 in out-of-pocket expenses. 1 Yet a recent survey found that 91 percent of respondents were unable to give a definition of the crime.2 The percentage is surprising considering that nearly 1.5 million Americans deal with medical identity theft every year.3 It’s also alarming. If consumers are unaware of the crime, they may also be unable to identify the signs it has occurred or resolve it if it does.
A healthcare data breach is one of the many crimes that facilitate medical identity theft. Nearly 80 percent of healthcare practitioners who manage personal health information have experienced one or more data breaches involving the loss of such information.4 A criminal may also steal someone’s medical insurance card or purchase stolen health information online. In the wrong hands, the data can lead to the fraudulent receipt of medical care or collection on insurance claims.
Since medical identity theft is difficult to spot, the resolution process might not begin until a consumer receives a collections notice. By then, the late payments on fraudulent bills have likely been adding up for at least a year. The extent of the damage makes the crime all the more costly and difficult to unravel.
One of the first steps for potential victims who suspect medical identity theft may have occurred is to place a fraud alert on their Experian® credit reports. A fraud alert notifies lenders to get prior approval from the borrower before opening a new account in his/her name. Since medical files often contain a great deal of personal information, the thief may have the needed birthdate, Social Security number and other details to perpetuate a wide variety of identity crimes.
Filing a police report is another important step. This gives the victim the needed validity that a crime has occurred. In cases of identity theft, the victim has to prove his/her innocence. For victims of medical identity theft, alerting health insurance providers is also among the first steps. The victim may need new insurance cards and possibly new identification numbers. Closing out an old number on a stolen insurance card can help prevent further fraud from occurring under that number, just like with a credit card.
The next steps get more complicated, depending on the severity of the crime. If a victim has received a fraudulent collections letter, he/she will need to contact the collections agency and inquire about clearing his/her name. Various creditors or agencies will require different documents, from a police report to a notarized Identity Theft Victim’s Complaint and Affidavit form.
Medical identity theft is a serious crime. The consequences don’t just include fraudulent bills. Identity thieves’ personal medical histories may become entangled with their victims’. Meaning when victims seek medical care, they may receive treatment or prescriptions based on an imposter’s conditions or blood type rather than their own.
Once someone has already been a victim of identity theft, the chances of it happening again increase. That’s why victims need to closely monitor their personal information for signs of fraud and act quickly if they detect additional misuse.
Experian® Data Breach Resolution helps consumers who have been affected by a data breach protect their identities with constant monitoring and an early warning alert system. Experian’s highly trained Fraud Resolution Agents help identity theft victims handle all of the important steps leading to recovery. If needed, our agents help with completing complex paperwork, building proof of innocence and contacting the necessary parties, from the IRS to the DMV.
1Ponemon Institute’s Second Annual Survey on Medical Identity Theft, released in March 2011.
2Ponemon Institute’s Second Annual Survey on Medical Identity Theft, released in March 2011.
3Ponemon Institute’s Second Annual Survey on Medical Identity Theft, released in March 2011.
4Ponemon Institute’s Electronic Health Information at Risk, released October 15, 2009.