Adam Kennedy – CSID Restoration Supervisor; Certified Identity Theft Risk Management Specialist
I recently began a series covering the severity of medical identity theft. In Part II of this series, I am going to cover some of the ways Identity Thieves are using medical information to commit fraud and put both your health and financial identity at risk.
What are the ways an Identity Thief can use my Medical information?
- Reporting false claims: The most common use is reporting false treatment claims to your medical insurance provider. Often the false reporting is from doctors or other medical personnel who are familiar with the billing system. The theft is usually hidden in large electronic payment systems in widely dispersed databases of medical files.
- Getting free treatment: Medical ID thieves who don’t have their own health coverage can use your identity to get free medical treatment based on your policy. They sign into a hospital or clinic using your identity and your policy receives the bills. At the same time, the thief is providing medical history information of their own, which may conflict with yours – such as allergies – altering your medical records in a potentially fatal manner.
- Cashing in on Fake Clinics: The profound amount of money being collected from medical identity theft has drawn in much attention from organized crime rings looking to cash in on what they consider the un-traceable crime. The National Insurance Crime Bureau reports that insurance fraud costs the insurance industry an estimated $30 billion each year. Organized theft rings will buy doctor’s stolen information on the black market and use them to set up fake clinics all over the nation. Once the fake clinic is set up with the doctor’s medical license number they can now claim several thousand dollars worth of x-ray machines, profile scanners, wheelchairs, prosthetics, lab-work, etc. and be reimbursed for medical equipment they never had to begin with.
What many do not know is that medical claims in collections are reported to your credit profile, dramatically reducing you credit FICO Scores. The severity of the drop can increase your interest rates and raise your mortgage and auto premiums to alarming heights. In a time of economic hardship, most employers are pulling credit checks before hiring a prospective employee. The damaging effect to your credit profile could potentially deny you a job in a time of need. This can also lead to your medical insurance being maxed out by fraudulent claims and the possibility of being denied treatment in the case of an emergency.