Medical ID Theft: The Next Wave

With all the attention over the past few years on Identity Theft in general, there is a new trend that is continuing to gain momentum. While identity theft in general has leveled off a bit, the category of Medical Identity Theft is continuing to be more of an issue.

Medical Identity Theft can take many guises, but can be thought of generally as someone using your identifying credentials to receive medical services. This could be anything from an emergency room visit to reconstructive surgery. With the costs of health care continuing to sky-rocket, this should come as no surprise. In fact, when compared to financial service where the average 'loss' is around $10,000 - this can be quickly dwarfed when it comes to health care.

The latest crime stats from 2007 suggest that over 250,000 consumers were the victims of Medical Identity Theft. Much like financial services, the typical fraud can involve either someone using an existing Insurance ID and policy information to utilize an existing account, or alternatively, apply for new services in the victim's name using the stolen ID information such as SSN and DOB.

Historically - health care providers have not deployed the scrutiny in the new account opening process as banks. However - this is beginning to change. Partly due to the increase in related fraud, but also due to the FACT Act provisions which will require health care providers to screen for Medical Identity Theft. While health care providers have not fallen under the regulatory banking agencies, they will now be regulated with respect to Identity Theft practices by the FTC - As of August 1st, 2009.

With the new mandate to electronify all medical records - we expect to see a lot of activity here over the next few years.