Medical Identity Theft

The truth behind medical identity theft: What you don’t know can cost you

First-of-its-kind study reveals the reach and severity of medical identity fraud in the United States

Irvine, Calif., March 3, 2010 — Medical identity theft is an alarming and often undetected offense affecting today’s consumers, according to a recent survey conducted by The Ponemon Institute and sponsored by ProtectMyID.com™, Experian’s multilayered identity theft detection, protection and fraud resolution product. According to the study, nearly 1.5 million Americans have been victims of medical identity theft.1 For many, the notion of identity theft is both upsetting and daunting, but few individuals realize the specific severity and potential repercussions of medical identity fraud. It is estimated that the costs associated with this type of theft total about $28.6 billion — or approximately $20,000 per victim.2 Not only is resolution of medical fraud an especially arduous endeavor, but the difficulty of recognition and the potential associated costs also make it particularly dangerous.

“We are pleased to work with Experian’s ProtectMyID.com for this first-of-its-kind study,” said Dr. Larry Ponemon, chairman and founder of Ponemon Institute. “This is the first empirical study that attempts to measure the size and scope of the medical identity theft, and our results underscore the importance of informing the public why the protection of their medical records is of the utmost importance. This study confirms that there is not only a significant financial impact to medical identity theft, but that there is a very real danger of erroneous diagnosis and treatment because of medical records that contain false information.  All this adds up to the need for urgency on the part of consumers to self-educate and take the proper steps to ensure the integrity of their medical identity.”

One of the most common instances of medical identity theft is the use of a stolen insurance ID card in order to receive medical services. The main problem in combating the theft is the time it takes to recognize that it has occurred. According to the study, more than 50 percent of consumers didn’t discover that they had been victimized until at least a year after the incident or incidents had occurred. Only 6 percent received a timely notification that their medical records had been breached. These unsettling figures indicate that a significant number of consumers are currently and unknowingly being targeted by medical identity thieves.

Adding to the number of those affected are the individuals who choose not to report wrongdoings to the authorities. In fact, 46 percent of respondents elected not to report incidents to law enforcement officials or other legal authorities. Within this group, the predominant reasoning for withholding such information is even more surprising: 49 percent of those surveyed said that they were close to the thief and did not wish to subject him or her to legal trouble. With so many unreported cases of medical identity theft, it is clear that the reach of such fraud goes far beyond the total number of documented incidents.

“The difficulty in detecting medical identity theft makes it a particularly dangerous form of fraud,” said Jennifer Leuer, general manager of ProtectMyID.com. “Arming yourself with the tools provided by a fraud protection product such as ProtectMyID.com can prove invaluable in early detection and resolution, especially knowing that if something does happen you won’t be alone in getting the matter resolved.”

The potential consequences of medical identity theft have proved to be extremely damaging. Forty-eight percent of respondents said they lost their health care coverage completely, and 32 percent noted an increase in their insurance premiums. Of those surveyed, nearly 80 percent suffered negative ramifications as a result of the theft.

In order to combat these risks, ProtectMyID.com offers coverage specifically designed to aid consumers who are victims of medical identity theft. The following features will be available this month:

Ongoing and daily monitoring for identity theft using insurance policy numbers. This will flag suspicious Internet activity involving personal medical information and keep customers informed along the way.

Dedicated resolution agents who are trained to notify and work with health care providers on behalf of customers to resolve any theft-related issue. This removes the mystery and uncertainty from dealing with providers and delegates the responsibility to a trained agent.

A lost wallet feature allows the consumer to make one call to a trained agent and receive assistance in the cancellation and reordering of lost wallet items, including credit cards and medical and dental insurance cards.

Alerts inform members when medically related collection actions occur.

Compounding the effects of medical identity theft is the reality that resolution is extremely difficult. Of those surveyed, only 9 percent of victims reported that they have completely resolved the crimes against them and restored their identity. In contrast, an overwhelming 40 percent of respondents had not reached resolution at the time of the study. As a result of the situation, 55 percent of victims lost confidence in their health care organizations. According to the study, medical identity theft is a pervasive issue that frequently goes untreated and often unnoticed by consumers.

“At ProtectMyID.com, we want to educate consumers about the risks associated with medical identity theft and give them the tools to better protect themselves against this crime,” said Leuer. “We are proud to sponsor this groundbreaking study because when people are informed, we find that they are empowered to take steps to protect all their valuable information.”

About The Ponemon Institute®
The Ponemon Institute is dedicated to advancing responsible information and privacy management practices in business and government. To achieve this objective, the Institute conducts independent research, educates leaders from the private and public sectors, and verifies the privacy and data protection practices of organizations in a variety of industries.

About ProtectMyID.com
ProtectMyID.com is a leading, full-service provider of proactive identity theft detection, protection and fraud resolution. ProtectMyID.com offers comprehensive identity theft protection products supported by experienced identity theft resolution professionals who deliver personal attention that customers can rely on. ProtectMyID.com is a Website owned by ConsumerInfo.com, Inc., an Experian company. For more information about how ProtectMyID.com helps consumers protect themselves against identity theft, please visit http://www.ProtectMyID.com.

About Experian
Experian® is the leading global information services company, providing data and analytical tools to clients in more than 65 countries. The company helps businesses to manage credit risk, prevent fraud, target marketing offers and automate decision making. Experian also helps individuals to check their credit report and credit score and protect against identity theft.

Experian plc is listed on the London Stock Exchange (EXPN) and is a constituent of the FTSE 100 index. Total revenue for the year ended March 31, 2009, was $3.9 billion. Experian employs approximately 15,000 people in 40 countries and has its corporate headquarters in Dublin, Ireland, with operational headquarters in Nottingham, UK; Costa Mesa, California; and São Paulo, Brazil.

For more information, visit http://www.experianplc.com.

Experian and the marks used herein are service marks or registered trademarks of Experian Information Solutions, Inc. Other product and company names mentioned herein may be the trademarks of their respective owners.

1-2Survey conducted by The Ponemon Institute in February 2010

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