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Businesses Have a Stake in Medical Identity Theft

People used to scratch their heads at the thought of medical identity theft. Of course some still do, but, more and more, people can tell you what it is and name someone who’s experienced it.

The Ponemon Institute’s Third Annual Study on Medical Identity Theft shows that instances of the crime grew 22% from 2011 to 2012. Also increasing is the number of people who can define what the crime is. Ninety percent could in 2012 vs. 77% in 2011.

With the level of consumer awareness and the rate of incidents growing, businesses need to take note. Medical identity theft doesn’t just impact patients. It’s a monetary drain for providers and other medical entities too.

The Ponemon study, sponsored by Experian’s ProtectMyID®, clearly shows that medical identity theft robs victims of the trust and confidence they previously had in their healthcare providers. That’s one way that providers suffer: Loss of business due to loss of trust. The kicker? The study also shows that providers aren’t to blame in 65% of medical identity theft cases. Yet the crime affects businesses all the same.

Need more proof that providers have a stake in medical identity theft? On average, victims estimate the value of medical services stolen in their names at $29,464 per incident. It’s a costly mistake to assume providers and other entities don’t share in that loss.

Both consumers and businesses lose when it comes to medical identity theft. Victims pay, on average, $22,346 each to resolve the crime. Many pay out of their own pockets just to have their medical insurance reinstated after the crime occurs.

It’s a stressful situation. Some patients incur legal fees, see their credit scores diminished and receive inaccurate care at the doctor’s office. For some (41% in the Ponemon study) the termination of their healthcare coverage leaves them without affordable access to medical care.

On the business side, there’s no room for attitudes like, “it’s not our fault” and “we won’t lose patients because of this.” In the study, only 34% express that it would be too difficult to change providers if they couldn’t trust their current one to protect their medical data. That means, for 66%, switching providers is not too daunting of a task.

Providers have all of this to consider, even when they aren’t at fault for medical identity theft. But what about those instances when something akin to a medical data breach is the reason why patients are at risk for medical identity theft? In those instances, according to the study, the top three expectations of patients are:

  1. Reimbursement for the costs of finding another health provider
  2. Prompt notification of the loss or theft
  3. Free identity protection for one year

These expectations add up to even more costs for providers to consider in relation to medical identity theft. But, first and foremost, providers need to consider their level of data security and employee training – two things that can help to minimize the costly damage of both medical breaches and medical identity theft.

Protecting data and helping patients who discover they are victims of medical identity theft are part of operating in healthcare today. There aren’t any excuses for not being prepared. Patients highly value the privacy of their data and expect businesses to do the same.

Download the Third Annual Study on Medical Identity


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