Stolen Medical Identity and Health Care Industry - Healthcare | Financial Buzz

Stolen Medical Identity and Health Care Industry

Financial Services, Identity Theft, ComputerUnlike financial services, health care companies do not have proper measures to forbid identity theft. This becomes particularly ominous in a world of digitized medical records.

The health care industry, in 2013, suffered excessive breaches of data than previously in its history. The year contributed a massive 44 percent of total breaches, as per information published by Identity Theft Resource Center.  The medical industry numbers crossed all other in this regard. In contrast, financial services accounted for only 3.7 percent of total breaches.

According to data gleaned from a security survey encompassing 91 security organizations, about 90 percent of total respondents have suffered a breach of data in past two years. About 38 percent of total respondents have suffered multiple incidents. The 2013 survey was conducted by ID Experts.

Causes of breaches

Such breaches, including stolen or lost computing devices or an error made by the employee are quite commonly seen in health care businesses. Other causes include mistakes made by a third party. There are also cases of “Robin Hood fraud,” where a person intentionally provides a family member or friend to receive health care. This is considered dishonesty in medical circles. However, criminal activities have seen exponential growth in recent years. The shocking theft of a total of 4.5 million records in August at Community Health Services, a hospital operator, only confirms the trend.

According to Rich Kam, co-founder and also the president of ID Experts, his team is engaged in tracking the instances where law has been broken, previously. ID Experts assist health organizations to prevent breaches and respond to them in an effective manner.

Unlimited profits

In medical fraud cases, the criminals use the victim’s medical credentials – like name, health insurance numbers and Social Security Number to order services and goods which are never delivered. These are then used to bill Medicaid, Medicare and similar organizations. The reason for this kind of crime is that  such activities are much more profitable than other crimes like prostitution and selling drugs. It is for the same reason that medical identities are infinitely more valuable compared to financial identities. Digitization of health information also makes it much easier to commit a fraud.

It is estimated that medical fraud in the US is in the range of $80 billion to $230 billion. The health care organizations that suffer from breaches of information bleed an amount of $1 million spreading over two years.

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