Medical Identity Theft: Defence & Prevention Measures

When someone steals your personally identifiable information (PII), which can include your health insurance number, name, Social Security number, or prescription identity, to receive medical care or services and/or to submit fraudulent healthcare claims, this is medical identity theft. 

Medical identity theft can cost patients an average of $13,500 to resolve. It can also interfere with your medical care and medical records, as someone else has been using your benefits.

It is very important to keep your protected health information (PHI) secure, as it is highly valuable on the black market. Bad actors can use this information to fill prescriptions, obtain medical care through Medicare or Medicaid, or commit insurance fraud. 

Medical identity theft is a serious concern with potentially significant health and financial ramifications. The best way to combat medical identity theft is through preventative measures.

What is medical identity theft?

Medical identity theft is a type of identity theft where someone uses your personal identity information to obtain medical care, services, or prescriptions, or to file fraudulent health insurance claims. 

Your PII can include the following:

• Full name
• Birth date
• Social Security number
• Health insurance number
• Medicare or Medicaid coverage number
• Prescription identity information

With this information, a fraudster can commit medical identity theft in the following ways:

• File a fraudulent insurance claim.
• Obtain healthcare services or Medicare or Medicaid services.
• Fill and purchase prescriptions.
• Obtain medical equipment.

Medical identity theft is especially dangerous since it can disrupt and interfere with your personal healthcare needs. For example, you can reach your annual maximum coverage amounts without ever filing a claim personally. Then, when you need care, you could be denied coverage and therefore unable to afford the care you need. 

It could lead to a medical emergency, as medical identity theft can create errors in your medical records. This can cause you to get the wrong treatment or necessary care, which can be disastrous in the event of an emergency. 

You could also end up with criminal charges if fraudsters use your personal health information to purchase large quantities of pharmaceuticals. 

Protecting your prescription identity

To keep fraudsters from stealing your prescription identity and using it to obtain unauthorised prescriptions (often while sending your insurance company the bill through a fraudulent insurance claim), you need to keep your personal and sensitive healthcare information safe from potential threats. This does not always mean a stranger, as around half of medical identity theft is perpetrated by family members. 

It is important not to share your personal medical information with anyone. This includes online or over the phone. Be very careful when sharing personal medical information, and only do so when you initiate the conversation. Go directly to healthcare sites, and do not open attachments or click on links sent via email.

Keep any and all documents containing your medical information secure, such as these:

• Prescription bottles
• Health insurance cards
• Billing statements from medical providers
• Prescriptions
• Explanation of benefits (EOB) statements from your health insurance provider
• Health insurance enrollment forms

When you need to dispose of these documents, shred them first. For prescription bottles, black out all personal identifiable information. Consider moving your mailing preferences to electronic to prevent possible mail theft. If you lose your health insurance or prescription card, or it is stolen, report this right away and request a new health insurance or prescription identification number immediately.

Best practices for preventing medical identity theft

Medical identity theft is complicated to unravel and resolve. Often, the best practices for managing medical identity theft are in prevention. Here are some tips to follow:

• Understand what measures healthcare providers are taking to keep your medical records and sensitive PII safe. Hackers often target medical information to sell on the dark web. As a result, it is important that this data is kept securely and within regulatory compliance.
• Keep an eye on your healthcare records, and pay attention to any communications or bills from your insurance, pharmacy, or healthcare providers. Look for unknown claims or suspicious activities in your medical records, insurance bills, credit, and explanation of benefits.
• Perform an annual check of your medical records and monitor your credit. Fraudsters will leave medical bills unpaid, so it is possible for these to go into collections and negatively impact your credit. Make sure that your medical records are accurate and that there is nothing out of the ordinary showing up, such as a preexisting condition that you do not have that can get you denied from insurance coverage. 
• If you notice anything that could indicate potential medical identity theft, such as errors in your medical records, unrecognised insurance claims, bills for services or prescriptions you did not receive, or a denial of service or coverage, report this immediately. Then, take the proper steps to recover your medical identity.

How to get help for prescription identity

If you suspect that you are a victim of medical identity theft, you should contact your healthcare provider and medical insurance provider right away. Obtain copies of your medical records, and begin the process of correcting the errors. 

This may involve submitting records request forms and paying associated fees. You will need to notify your healthcare provider in writing of any mistakes.

You should also review your credit by requesting your credit report from the three major credit bureaus for free from AnnualCreditReport.com. You should also report your identity theft to the Federal Trade Commission (FTC) and potentially your local authorities if you suspect major fraud or pharmaceutical dealings.

If you suspect Medicare or Medicaid fraud, you can contact the Office of Inspector General (OIG) hotline or the Senior Medical Patrol (SMP) for additional help and resources.

Additional resources

The Federal Trade Commission (FTC) offers a step-by-step guide on what to do if you are a victim of medical identity theft. 

It can also be a good idea to freeze your credit or put a fraud alert on it in the event of medical identity theft. Most of the major credit bureaus, such as Experian, offer free credit monitoring services as well as paid services for identity theft and further credit protection services.

Key takeaways

Prescription and medical identity theft can be a major headache that can cost you financially and potentially have severe health consequences. 

With medical identity theft, a fraudster steals your personal identity and healthcare information and then uses it to obtain medical services, prescriptions, or medical equipment. They often file fraudulent insurance claims on your behalf as well. This can lead to denial of necessary services or insurance coverage, unpaid medical bills that you did not incur (that often end up in collections dragging down your credit score), and errors in your medical records.

The best method for dealing with medical identity theft is preventing it from happening in the first place. Take special care with your medical records and all documents that have your personal and medical information on them. Keep them in a secure place, and do not share your healthcare data with anyone. Beware of online and phone scammers trying to obtain this information for the purposes of medical identity theft. 

Keep a close watch on your medical records, insurance bills, and credit to look for (and catch quickly) any suspicious activity. If you think you are the victim of medical identity theft, contact your healthcare and insurance providers immediately and begin a recovery plan.
 

References

Medical Identity Theft: Problems and Prevention. (February 2017). Healthcare IT News.

Fifth Annual Study on Medical Identity Theft. (February 2015). Ponemon Institute, LLC.

Annual Credit Report.com. (2022). Central Source, LLC.

IdentityTheft.gov Online Form. Federal Trade Commission (FTC).

Submit a Hotline Complaint. U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG).

Protect Yourself and Loved Ones From Medicare Fraud. (2022). The Senior Medicare Patrol National Resource Center.

IdentityTheft.gov What to Do Next. Federal Trade Commission (FTC).

Free Credit Monitoring. (2022). Experian.