Industrywide Coalition Forms to Combat Medical Identity Fraud

Recently, a man went to the emergency department at his local hospital, complaining of back pain. The on-call physician noticed an infection in his lymph node, and, after consulting the patient's chart, told the patient he was ordering a course of penicillin.

The patient became upset, demanding to know why the physician would order a drug to which the patient is severely allergic. The physician referenced the patient's chart, noting penicillin was administered during the patient's previous visit to the ED with no complications.

This was the patient's first trip to the small-town ED.

An investigation revealed the patient to be the victim of medical identity fraud — a growing issue in the United States. In 2012, 1.85 million Americans were affected by medical identity fraud and theft, up from 1.49 million in 2011, according to a survey conducted by the Ponemon Institute.

In addition to financial losses faced by victims, the survey found 41 percent of victims in 2012 lost their insurance coverage, and 14 percent reported mistreatment as described above. The survey also found the majority of victims to have lost trust and confidence in their healthcare providers.

This fall, the newly created Medical Identity Fraud Alliance, a coalition of providers, insurers, consumer groups and nonprofit organizations, will come together to develop best practices and strategies for combating medical identity fraud.

"Medical identity theft is one of the fastest-growing threats in the healthcare industry," says Robin Slade, a development coordinator for MIFA. "It's a far-reaching threat to the whole healthcare ecosystem and is contributing to rising healthcare costs."

She adds a growing reliance on technology to share patient information, as well as an increase in patients under healthcare reform, will increase the problem. "We're really experiencing unprecedented levels of risk," she says.

To provide a united front on the issue, MIFA is designed as a public-private partnership and "includes everyone in the healthcare ecosystem," says William Barr, a development coordinator for MIFA. Current members include AARP, Blue Cross Blue Shied of Florida (Florida Blue), Blue Cross and Blue Shield Association, Clearwater Compliance, Consumer Federation of America, GuideIT, ID Experts, Identity Theft Resource Center, M2SYS, the U.S. Department of Veterans Affairs and National Health Care Anti-Fraud Association. Henry Ford Health System in Detroit is also a member, and MIFA expects other hospitals and health systems to join in the coming months.

One of the biggest challenges in the fight against fraud is the fragmented nature of the healthcare industry, says Mr. Barr. MIFA intends to bring organizations together to share experiences and best practices on protecting patients' information.

"Fraud is not a competitive issue," says Ms. Slade. "This is an opportunity to mobilize the whole industry and ensure we're not just moving the fraud issue to other organizations or sectors of the industry."

MIFA recently released a whitepaper highlighting the extent of the issue and is in the final stages of a study with the Ponemon Institute examining the cost of medical identity theft to the healthcare industry. Ms. Slade and Mr. Barr assert the cost is high and at least some of that cost will be passed on to hospitals.

MIFA aims to be both a source of information and a discussion forum for hospitals to provide best practices and foster a dialogue on tried-and-true medical identify theft prevention techniques. "MIFA is positioned to be the go-to source on this issue," says Mr. Barr.

"Currently, though there are a large number of victims of [medical identity fraud], many consumers are unaware it exists," says Ms. Slade. "It's in a hospital's best interest to make sure consumers understand the risk of fraud and act as a first line of defense."

More Articles on Medical Identity Fraud:

43% of Consumers Believe EHRs Are Well-Protected by Healthcare Providers
1 in 4 Data Breach Letter Recipients Become Identity Fraud Victims
Patient Information Stolen From LSU Health 

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