Identity Theft Articles

Scammers use healthcare reform to defraud the public

Scam artists are using health care reform to sell victims phony insurance policies

Americans are being warned against giving out personal information or money to scam artists who claim to be representatives of Obamacare. Scammers are feeding off the public's confusion surrounding the new healthcare laws and going door-to-door to sell phony health insurance, according to McClatchy Newspapers.

The new healthcare laws will go into effect over a long period of time, but the number of healthcare mandates and the different dates that accompany them can cause confusion and make consumers more vulnerable to insurance scam artists. Many scammers manipulate their victims into purchasing fake policies by insisting there is a limited enrollment period for the new government healthcare plan, reports McClatchy.

"The economy being what it is and health care so expensive, people are finding it difficult to afford medical care, and they are persuaded by low-cost plans," Oklahoma state insurance commissioner and co-chair of the Antifraud Task Force for the National Association of Insurance Commissioners Kim Holland told McClatchy. "You've got these really unscrupulous people, and they are savvy in identifying the people who're most likely to be persuaded," Holland remarked.

Other criminals are using the Medicare coverage gap rebate as an opportunity to steal personal information. The new healthcare laws will allow a Medicare policyholder who has exceeded his or her prescription drug coverage and must pay for medication out-of-pocket to receive a one-time $250 rebate check from the government. Scam artists are contacting citizens under the pretense of sending them their $250 rebate checks and requesting bank account information.

Americans should be aware that the majority of changes, especially those that require all Americans to purchase health insurance, will not take place until 2014 and there is no limited enrollment period. Fraud experts are also discouraging Americans from giving out personal information, such as Social Security and bank account numbers, to anyone trying to sell government-sponsored health insurance over the phone or door-to-door, reports McClatchy.

Releasing personal information may not only result in fraud, but identity theft as well. More than 11 million Americans fall victim to identity theft each year, leaving them to pay thousands of dollars in damages. The blow to an identity theft victim's credit score and credit report may weaken them financially for many years by making it more difficult to secure loans and forcing them to pay higher interest rates. Americans should guard their personal information until they verify an insurance agent works for a legitimate company.