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Personal Finance How to Protect Your Medical Identity February 18, 2010 Sheryl Nance-Nash It ’s a major headache when your identity is stolen and the thieves charge up your credit cards buying clothes, taking a vacation or otherwise tarnishing your good name. When it comes to medical identity theft, the stakes can be higher.

“You’re screwed. Medical identity theft can affect your medical records. If erroneous information ends up on your medical records that you have allergies or are sick in a way that doctors prescribe deadly medications or insurance companies see you as a liability, this can cost you money and your life,” says Robert Siciliano, CEO of IDTheftSecurity.com.

The potential fallout can be catastrophic, says Margaret Lewin, MD, medical director, Cinergy Health.

An estimated 250,000-500,000 individuals have been victims of medical identity theft and the numbers continue to grow. Here’s how to protect yourself.

Guard your information

Medical identity theft is the fraudulent use of your personal medical and health insurance information. Most often, employees of medical facilities, who have access to your information, are the primary thieves, says Lewin. They either sell the information on the black market, or use it directly to cover their own medical care, to file false claims against your health insurance, or to buy drugs to feed their addiction or to sell on the street, she adds.

It can also be something as low tech as a stolen wallet containing a driver’s license and Social Security, where someone walks into a clinic or hospital and receives medical treatment, says Brian Lapidus, chief operating officer of Kroll Fraud Solutions. “When was the last time you were asked for your identification when going to the doctor?” asks Scott Mitic, CEO of TrustedID.

Additionally, HIPAA laws allow marketers to target audiences based on their medical records, increasing the number of people with access to those records, so insurance companies, marketers, or anyone else with an interest in a patient’s medical history can get some, or all of the information through electronic means, says Mitic.

Not only can be it be dangerous or deadly if the imposter’s medical information is merged with yours, if unauthorized health insurance claims are filed using your information, it can reduce the lifetime limits of coverage and payments available to you, says Lapidus.

If a thief uses your insurance to run up large hospital bills in your name, you can be responsible for all charges not covered by the insurance, directly impacting your financial well-being and credit history, says Lewin. Having false claims for serious illnesses in your medical record can set up pre-existing conditions leading to denial of future healthcare coverage; your insurance carrier can increase your premiums dramatically, or even cancel your insurance altogether, she adds.

Deception can be hard to detect

Medical identity theft is one of the more complicated and problematic types of identity theft that can occur. The reasons for these complications are mainly attributed to the current lack of a central repository for medical histories, and the extensive privacy laws in relation to medical file disclosure, says Lapidus. It is difficult to discover, and the fraud may exist until uncovered through a myriad of methods. More than 10 percent of victims of medical ID theft surveyed were denied health or life insurance for unexplained reasons, says Tom Rusin, CEO of Affinion Security Center. More than two-thirds of victims surveyed received a bill for medical services that were provided to an imposter, he adds.

Brandon Sharp got a nasty surprise when he was applying for a loan to buy his first house in 2003. “Someone was using my social security number and receiving emergency hospital care,” says Sharp. He spent countless hours calling hospitals, collection agencies, his attorney general, providing proof that those charges applied were not his. He had to get the help of a credit monitoring service. “It took six months to get the initial charges taken off. I still get charges and phone calls, although not as much as the initial hit,” says Sharp. He had to postpone the purchase of his house until he was able to get the information off his credit report. He continues to pay $100 per year for credit monitoring services.

Sharp is not sure how his information was stolen, perhaps a breech of some company’s network. But he had always been safety conscious, shredding important papers and bills. While there is no guarantee that you won’t be a victim, there are ways to protect yourself. “Check your credit report regularly,” says Sharp.

Put up a good fight

Make sure your insurance ID is different from your social security number. Immediately report to your carrier any lost insurance identification. When your insurance pays a medical claim, it should send you an explanation of benefits, detailing charges and payments. Go through this detail each and every time, calling the provider to explain any mysterious entries, and then calling your insurer to report any inadequate explanations, says Lewin. Make sure to follow-up with your insurer in writing, and file a report with the police and the Federal Trade Commission.

Be familiar with your health care providers’ privacy and security policies, when asked to sign a waiver for the release of your medical records, limit the amount of information that can be released, says Mitic. Keep your health information private. Don’t share your policy information with anyone without knowing how that person plans to use it, who will have access to it, and how the information will be protected, he adds.

Do not give sensitive information over the phone, warns Dave Miller, chief security officer of Covisint, a subsidiary of Compuware.

Futhermore, cautions Siciliano, “Don’t carry insurance cards in your wallet unless absolutely necessary, like when you have an actual appointment.”

Review your confidential records stored at the Medical Information Bureau should any exist. Your MIB records may be utilized by companies to determine your eligibility and liabilities in obtaining an array of insurance, including, health, life, long term care and critical care illness coverage, suggests Rusin.

If you’re a victim of medical theft identity, keep detailed records of your conversations and copies of your correspondence. File a complaint with the Federal Trade Commission, 1-877-ID-THEFT, http://www.ftccomplaintassistant.gov. File a complaint with your local police. Send copies of the report to your health plan’s fraud department, your health care providers, and the nationwide credit reporting companies. Information on how to file a police report is at www.ftc.gov/idtheft/consumers/defend.html.

Exercise your right under HIPAA to correct errors in your medical and billing records. Write to your health plan or provider detailing the information that seems inaccurate. Include copies (keep the originals) or any document that supports your position. In addition to keeping your complete name and address, your letter should identify each item that you dispute, state the facts and your reasons for disputing the information, and request that each error be corrected or deleted. You may want to enclose a copy of your medical record with the items in question circled. Send your letter by certified mail, and ask for a “return receipt” so you can document what the plan or provider received. Keep copies of your dispute letter and enclosures.

Says Siciliano, “Treat your medical identity as you treat your financial identity. Protect yourself.”