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Wall Street Journal Examines Medical Identity Thefts

Armen Hareyan's picture

Medical Identity Thefts

The Wall Street Journal on Thursday examined the growingtrend of medical identity theft, which is being attributed in part to"escalating health care costs and growing ranks of the uninsured."Medical identity theft occurs when a person uses someone else'sinsurance information to pay for health care services, drugs and otherproducts illegally or without proper permission. Consumers typicallyare more unfamiliar with this type of fraud than with financialidentity thefts through misuse of credit card information.

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Pam Dixon, executive director of the advocacy group World Privacy Forum,estimated that about 500,000 U.S. residents have been affected bymedical identity theft. Targeted consumers often are unaware thatfraudulent activity has taken place, and fixing the damage can bedifficult, according to the Journal. Targets of medicalidentity theft can face a number of challenges when their medicalinformation is corrupted by imposters, including being given incorrecttreatments based on falsified health records, losing their eligibilityfor insurance, failing pre-employment health tests and acquiring badcredit records.

In addition, they could be restricted fromaccessing their own health information if control over the data hasbeen transferred to the thief, the Journal reports. At the national level, such medical fraud can result in higher premiums, taxes and copayments.

Medicalidentity theft is becoming increasingly popular with criminaloperations, which might work with staff members inside a hospital orphysician's office who have easy access to patients' insurance data,according to the Journal. Mike Stergio, director of the special investigations unit at Aetna,called it "a very lucrative crime." Nils Frederiksen, a spokespersonfor the Pennsylvania attorney general's office, said, "You need totreat your medical ID card as if it were a Visa card with amillion-dollar credit limit" (Knight, Wall Street Journal, 10/11).

Reprinted with permission from kaisernetwork.org. Youcan view the entire Kaiser DailyHealth Policy Report, search the archives, and sign up for email deliveryat kaisernetwork.org/email. The Kaiser Daily Health Policy Report is published for kaisernetwork.org, afree service of The Henry J. Kaiser Family Foundation.