Health Alert: medical identity theft that's bad for your health

A new heinous form of identity theft is targeting middle aged adults and seniors. It's called medical identity theft and AARP has just issued a warning to it's members. It's not a small problem either and affects 250,000 Americans a year.

Here's how it works. A crook steals your social security, date of birth and address and then uses that information to have medical costs billed to you and your insurance company. Like all forms of identity theft, it's up to you to clear your name--a laborious process that can take over a year. And it's not just the inconvenience of clearing your name that is the problem. Since the crook is using your identity to get medical treatment, your electronic medical records can contain the wrong information about drugs you are taking or conditions that you have. You could get improper treatment based on an impostor’s health history or have trouble buying life or disability insurance.

AARP notes that "People 50 and older are at the greatest risk because they often have some kind of government-issued insurance, such as Medicare or Medicaid, [and] that’s a big lure for the scammers."

How do you protect yourself? Author Sid Kirchheimer suggests the following:

1. Ask your doctors to make you copies (you may have to pay for them) of everything in your medical file; keep the files updated for a protective “paper trail.” Ask, too, for an “accounting of disclosures,” which shows who accessed your records.

2. Review all correspondence from medical insurers, including those “This Is Not a Bill” statements. Look for any treatment you didn’t receive.

3. Once a year, ask insurers for a list of all payments made in your name to uncover cases where a thief changes “your” billing address.

4. If you note errors or suspect identity theft, immediately call the billing physician and request that your file be amended. Contact your regional office of the Centers for Medicare & Medicaid Services, if you receive those services, and your state attorney general’s office.

5. Monitor your credit report with credit reporting bureaus Equifax, Experian and TransUnion, looking for reports of medical debts.

Better yet read this:

Update: The Los Angeles Times just published a story on the topic called "ID Theft Infects Medical Records" (note: the Times may require free registration to read certain articles). The Times piece covers the experiences of Lind Weaver when she was contacted by hospital bill collectors trying to get her to pay for surgery she did not have. For her it was relatively easy to prove that she did not have her right foot amputated, but even with that she was still dealing with the problem a year later. "It became a 40-hour-a-week job," she remarked.

In addition to the hassle-factor, the Times piece also covered how bad medical information can also put careers and insurance at risk. A third of Fortune 500 companies demand access to medical records when making hiring, promotion or benefits decisions. Health and life insurance companies routinely scan medical files or payout reports before issuing new policies.

To make matters worse, fixing medical record mistakes is far more difficult than correcting identity theft problems. This is because credit reports are centralized in three major credit bureaus. In contrast, medical records can be scattered across dozens of medical facilities, doctors offices, hospitals and clinics. Federal privacy rules can also hamper efforts to find out if you have a problem and how to fix it. It's quite possible that you the victim of the identity theft will not have the power to change the inaccurate information.

Not surprisingly, collection agencies don't care about explanations and continue to push for payment. As time continued, the amount "owed" continued to increase as interest and fees were tacked on by each new collection agency picking up the bill. To credit bureaus, these looked like new credit problems which continued to plague the victim's credit.

For more information go to the World Privacy Forum, Trusted ID or click on these tags for others blogging on this issue: identity theft, medical ID theft