Imagine this: You and your husband both have stellar credit ratings, but when you try to refinance your mortgage, your application is promptly denied. Days later you get a statement from your health insurance company with a laundry list of expenses for an operation you never had. Then a bill collector starts calling at all hours, saying you owe hundreds of dollars in lab fees to a hospital halfway across the country. This isn't just a hypothetical, worst-case scenario. It's medical identity theft—one of the fastest-growing crimes in America. Con artists somehow get hold of your health insurance information and then go to a pharmacy, clinic, or hospital to get treatment or drugs under your name. You're not only stuck with sky-high bills; you've also become entangled in a web of false information that can plague you financially and medically for years. There were more than 300,000 such cases of fraud in 2009, according to the Federal Trade Commission (FTC). "With increased use of electronic data systems—not to mention tech-savvy thieves—that number will likely continue to grow," says Pam Dixon, executive director of the World Privacy Forum, a public interest research group. Learn what you need to know to protect your pocketbook—and your health.
Who's Conning Whom
Medical ID theft can be as simple as someone copying your health insurance or Social Security number or other personal information, assuming your identity at a doctor's office, then billing services and treatment to your policy. In other cases the crooks are medical personnel. Doctors can download your info from health-care provider databases and charge you for services they never performed. Pharmacists, nurses, or receptionists might use your identity to get prescription drugs for themselves or to sell to others. Medical ID theft can also involve organized crime rings, which buy stolen information on the black market and then set up fake clinics that make bogus claims so they can pocket the money from your insurance company.
The Price You Pay
Even though medical-related fraud accounts for roughly 60 percent of all identity theft in this country, there is very little protection in place for its victims. As a result, the damage can be devastating. If someone racks up hospital bills in your name, you are responsible for paying until you can prove you didn't receive the services, a process that can take years. What's more, thefts often go undetected for a long time; according to one recent survey, half of victims didn't learn about it until one or more years after the incident. In the meantime, unpaid balances are piling up and ruining your credit rating. False claims can also result in insurance companies raising your premiums. They can quickly max out your benefits as well, leaving you with no coverage in the event of a genuine emergency. And once the thief's medical history gets mixed up with yours—meaning his diagnoses and illnesses are under your name—you might be denied coverage down the line for a preexisting condition you don't actually have. Inaccurate records also pose a grave danger to your health. If your files contain misleading info on blood type, allergies, or medicines being taken, doctors might inadvertently administer treatment that could kill you.
As with any crime, there's no way to ensure against being ripped off, but you can take smart steps to lower the odds.
Guard your insurance card. Most likely you keep it in your wallet in case of emergency, and that's good. But be as careful with your health insurance card as you are with your passport. If it's lost or stolen, contact the company right away.
Examine your EOBS. Scrutinize every Explanation of Benefits Statement that comes in the mail. If you don't recognize a doctor, date, or treatment, report the error to your insurer. Since thieves often divert individual statements to another address—so you'll never know a false claim has been filed—request an itemized list of EOBSs annually.
Check your credit report. Try to do this more than just once a year. Unpaid medical bills that have gone to collection agencies are included in these reports, which is the most common way people learn they've been a victim of ID theft.
Say no to freebies. Thieves sometimes set up free screenings or other services in order to steal medical data. If you do take, say, a vision exam or blood pressure test at a pharmacy or health fair, never give out your insurance card number or other personal information.
Suspect a Crime?
You've got to act fast. Immediately request a copy of your records from your health-care provider—even if you have to pay for it—so you can look for telltale details and discrepancies. Just be sure not to mention fraud to your provider at this stage; once it's on the record that your medical information may be intermingled with someone else's, privacy laws dictate that all of it be kept confidential, making it difficult to access your own records.
Originally published in the November 1, 2010, issue of Family Circle magazine.