Perspectives Newsletter

Issue 1 | May 2011

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On Demand Webinar

Medical Identity Theft Trends: The Importance of Securing Healthcare Data

Find out the latest findings from the Ponemon Institute on the evolving pervasiveness of medical identity theft and how it affects American consumers.

Presenter: Dr. Larry Ponemon

Ponemon Institute’s Second Annual Survey 2011

Ponemon Institute’s Second Annual Survey on Medical Identity Theft Shows Marked Increase in Theft Incidents and Overwhelming Need for Public Awareness

The results of the Ponemon Institute’s Second Annual Survey on Medical Identity Theft, released in March 2011, indicates that the crime is rising steadily in the U.S. and that a significant percentage of the population is unaware of it and its severe repercussions. The study reveals that medical identity theft is a multi-billion dollar crisis that is growing by $2.3 to $30.9 billion per annum.

Medical identity theft is defined in the study as occurring when someone uses an individual’s name and personal identity to fraudulently receive medical services, prescription drugs and/or goods, including attempts to commit fraudulent billing. Ninety-one percent of respondents in the survey’s general sample acknowledged that they did not know the definition of medical identity theft before completing the survey. And while some respondents had prior knowledge, the source of information was family or friends who shared their experiences.

A preliminary extrapolation on the total cost of medical identity theft in this country shows that in 2010 the approximate number of adult-aged consumers was 269 million with 1.42 million affected by medical identity theft costing around $28.6 billion for the year. The extrapolated cost per victim was $20,160. The 2011 figures reflect an adult-aged consumer population of 271 million with 1.49 million being affected by medical identity theft at an annual cost $30.9 billion, or $20,663 per victim.

The majority of medical identity theft victims are in the 26 - 55-year-old range with 36 percent stating that a family member stole their identity. Seventeen percent did not know how it happened. About 29 percent said that their identity was stolen by accessing a credit report or healthcare records. And upon learning of the theft, only half of the victims reported it to law enforcement.

At 67 percent, the survey indicates that a large number of the thefts occur in order to obtain healthcare services or treatments. Thefts to obtain prescription pharmaceuticals or medical equipment are next at 63 percent. Forty-five percent of survey respondents said that their medical information was stolen to obtain government benefits, including Medicare and Medicaid.

Medical identity theft poses some devastating consequences with 49 percent of medical identity theft victims having had their plans terminated by their insurance provider. Fifty percent incurred additional out-of-pocket expenses. Most victims learned of the theft through collections letters, mistakes in health records and a drop in their credit scores. Other adverse effects include receiving the wrong medical treatment and finding that health insurance benefits have been exhausted.

To prevent future incidents, 29 percent of survey respondents stated that they will monitor their credit reports and 25 percent said that they would review their medical records. Forty-nine percent indicated that they would not take any new precautions.

For more information on the Ponemon’s Institute’s study on healthcare data breaches and medical identity theft, visit the Experian Data Breach Resolution Resources site.

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