facebook twitter instagram linkedin google youtube vimeo tumblr yelp rss email podcast phone blog search brokercheck brokercheck Play Pause
October 2022 E-Newsletter Volume #2: Medicare Identity Theft is on the Rise. How to Avoid Becoming a Victim Thumbnail

October 2022 E-Newsletter Volume #2: Medicare Identity Theft is on the Rise. How to Avoid Becoming a Victim

Jonathan M. Gardey, MBA, CFA®, CFP®

President and Chief Executive Officer

Over the last few years, healthcare-related fraud has exploded, driven in part by the COVID pandemic as well as the increasing number of seniors going on Medicare. As with any type of identity theft, medical identity theft can be devastating, particularly for the most vulnerable among us—seniors with health concerns relying on their Medicare benefits.

Fraudulently obtained medical information is used routinely by fraudsters to fill prescriptions, receive medical treatment, purchase medical equipment, and submit fraudulent insurance claims in your name. The damage caused can go well beyond finances; it can threaten your health.

It Could Change Your Medical Care

For example, if fraudsters use your medical identity to access healthcare, it could affect the accuracy of your medical records. If the fraudster's medical conditions and care are listed along with your own, it could affect your care.

If you're not aware that your medical identity has been stolen, you won't know about the incorrect information. That's why healthcare providers ask that you review your medical history before seeing your doctor.

You could lose coverage

If a fraudster files an insurance claim using your Medicare ID, it becomes part of your claims record. That could count against your coverage limits for medical care or prescription drugs, resulting in a delay or denial of treatment. If a fraudster's medical diagnosis of a pre-existing condition shows up on your medical record, your Medigap insurer could deny you coverage.

Your out-of-pocket costs will increase

If a fraudster uses your Medicare ID to pay for medical treatment or drugs, you are responsible for unpaid copays or expenses. If you're unaware that your Medicare ID has been stolen, you could end up unintentionally paying these bills.

It could hurt your credit rating

While medical debt doesn't affect your credit rating, an unpaid medical debt that has gone to collections can, which can hurt your chances of qualifying for a credit card or refinancing your mortgage. And fixing your credit record can take time and money.

If you experience any of the above circumstances, you have likely become a victim of fraud. You should contact your insurance provider immediately to get specifics and correct your record.

How Fraudsters Steal Your Medicare Identity

While Medicare has experienced data breaches in the past, the most common way fraudsters steal medical identities is through impersonation. They can play the role of a Medicare representative, government employee, healthcare worker, or insurance representative, contacting you through phone calls, letters, emails, or text messages.

While fraudsters can sound very convincing when talking about something important to you, there are several red flags to look for that can alert you to a possible scam:

  • You receive an unsolicited call from someone claiming to work for Medicare. Remember, that doesn't happen unless you ask a Medicare representative to contact you.
  • A Medicare imposter asks you for your ID number to activate your card or confirm you received one.
  • Someone claims there has been suspicious activity on your Medicare account and says your coverage may be suspended if you don't verify your ID.
  • You are threatened with cancellation of your coverage unless you provide personal information.

Fraudsters also try to trap you by using 'phishing' emails—emails designed to look legitimate as if sent from Medicare, an insurer, or a government agency. The emails may contain the same type of claims described above; except they provide you with a link that takes you to a bogus website to collect your information.

How to Prevent Medicare ID Theft

The first rule to follow for preventing Medicare ID theft is not to provide any personal information to anyone unless they can verify their identity. Essentially, that means anyone who calls or emails you. You can verify the identity of anyone calling as a Medicare or insurance representative by calling Medicare directly at 1-800-633-4227.

Here are additional best practices to keep your identity safe:

  • Do not share your Medicare number with anyone: Treat your Medicare ID card as you would your driver's license or Social Security card. There's no reason to provide your number to anyone except your providers or someone you trust implicitly.
  • Treat your Medicare ID like a credit card: While you should always have your Medicare ID card with you, don't take it out where others can see it.
  • Protect your medical and insurance files: Keep your medical and insurance records filed away and shred those containing your Medicare and Social Security numbers. If you can't or don't want to shred them, black out the numbers with a marker. Also, clear your mailbox daily to prevent fraudsters from stealing sensitive information.
  • Review your records frequently: Review copay receipts, Medicare summary notices, treatment summaries, and other statements looking out for suspicious activities. Add your medical appointments, tests, and prescription refills to a calendar and check them against your claims activity on your statements.
  • Get identity theft protection: Many property insurers offer identity theft protection, which can reduce the risk and impact of an occurrence. They not only provide financial protection but also services to help you recover your identity and fix your records.

What to do if You Suspect Your Medicare ID has been Stolen

  • If you suspect your Medicare ID has been stolen, contact Medicare immediately at 1-800-633-4227. You can also request help on the Health and Human Services website at the Office of the Inspector General's hotline. The Medicare website also provides the information you will need when reporting the fraud.
  • If you have been a victim of Medicare fraud, you may need help restoring your identity. You can start by notifying the Federal Trade Commission at identitytheft.gov or calling 877-438-4338.
  • Contact your insurance agent.

Unfortunately, in today's digital age, Medicare identity fraud is becoming more common. As your financial advisors, we are always looking out for you, which is why we find it important to keep you abreast of these potential threats to your financial well-being.

If you aren't a current client and would like more information about the comprehensive planning services we provide, we encourage you to visit our site, learn more about our services, and see if we could be a good match. We best serve clients looking for exceptional client service, who value a long-term partnership, and have a minimum of $500,000 in investable assets.

Publication Disclosure:

Important Disclosure Information

To better understand the nature and scope of the advisory services and business practices of Gardey Financial Advisors Inc., please review our SEC Form ADV Part 2A and ADV Part 3 (Form CRS) available via the SEC's website, www.adviserinfo.sec.gov. (Click on the link, select “Investment Advisor Firm,” and type in the firm name. Results will provide you both Part 1, 2 and 3 of the Gardey Financial Advisors Form ADV.) Statistics from third-party sources are deemed to be accurate but have not been confirmed by Gardey Financial Advisors.

This communication is for informational purposes only and does not purport to be a complete statement of all material facts related to any company, industry, or security mentioned. The information provided, while not guaranteed as to accuracy or completeness, has been obtained from sources believed to be reliable. Moreover, you should not assume that any discussion or information contained in this commentary serves as the receipt of, or is a substitute for, personalized investment advice from Gardey Financial Advisors. The opinions expressed reflect our judgment now and are subject to change without notice and may or may not be updated. Past performance should not be taken as an indication or guarantee of future performance, and no representation or warranty, expressed or implied, is made regarding future performance. Readers who are not market professionals or institutional clients of Gardey Financial Advisors should seek the advice of their financial advisor, tax or legal advisor before making any investment decisions based on this communication. Gardey Financial Advisors does not render legal, accounting or tax advice. Gardey Financial Advisors works closely with our client’s other professional advisors. The solutions discussed may not be suitable for you, even if your situation is like the example presented. Investors must make their own decisions based on their specific investment objectives and financial circumstances. It should not be assumed that the recommendations made in this situation will result in the mentioned outcome. The commentary does not represent any specific clients, investments, or strategies.


By selecting the links identified in this publication, you may be redirected to third-party websites, over which Gardey Financial Advisors has no control. Gardey Financial Advisors makes no warranties as to the content or accessibility of the third-party website and assumes no liability for errors or reporting inaccuracies. Gardey Financial Advisors neither approves nor endorses the statements made by the third-party on their website. Third-party website content is subject to change without notice and may or may not be updated. It is the responsibility of the viewer/reader to ensure third-party sites accessed are virus-free and Gardey Financial Advisors accepts no responsibility for any loss or damage arising in any way from the hyperlink or third-party website