As many as nine million Americans have their identities stolen each year. The crime takes many forms. But when identity theft involves health care, the consequences can be particularly severe.
Medical identity theft happens when a person seeks health care using someone else’s name or insurance information. A survey conducted by the Federal Trade Commission (FTC) found that close to 5% of identity theft victims have experienced some form of medical identity theft. Victims may find their benefits exhausted or face potentially life-threatening consequences due to inaccuracies in their medical records. The cost to health care providers — left with unpaid bills racked up by scam artists — can be staggering, too.
The Red Flags Rule, a law the FTC will begin to enforce on August 1, 2009, requires certain businesses and organizations — including many doctors’ offices, hospitals, and other health care providers — to develop a written program to spot the warning signs — or “red flags” — of identity theft. Is your practice covered by the Red Flags Rule? If so, have you developed your Identity Theft Prevention Program to detect, prevent, and minimize the damage that could result from identity theft?
So the FTC has deputized my office to help identify identity thieves, with a formal system to flag possible violators. This, I'm sure, saves the government quite a bit of money in the enforcement divisions. My office will be in the position of needing to verify with each and every patient that they are who they say they are, and that they have the insurance coverage they say they have, and that their method of payment is their own, and not through a stolen credit card or falsified insurance information.
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The Senate Finance Committee, on the other hand, doesn't think much of these red flag rules, or rather, doesn't think they should apply when obtaining coverage under a government-run plan/cooperative/marketplace. A simple requirement for a photo ID - which doctor's offices must now request from each patient who registers with us - does not apply when registering for the insurance plan in the first place. Deputizing physicians' offices to root out identity thieves and insurance fraud - good. The government rooting out identity thieves, insurance fraud and those not eligible for benefits - bad.