Every 30 seconds in the United States, someone files for bankruptcy in the aftermath of a serious health problem. According to a Harvard study, illness and medical bills are the cause of half the personal bankruptcies filed in U.S. An estimated one million Americans are financially ruined by illness or medical bills each year - more than half of them are college educated, homeowners, with good jobs. Surprisingly, more than 75% were insured at the start of the bankrupting illness.
Now I'm going to throw another number at you: 80 percent. That's the number of hospital bills that contain multiple errors, according to the Medical Billing Advocates of America.
Here's one final stat: 250,000. That's the number of medical identity theft victims reported to the FTC each year.
Now there is talk of a medical FICO score being developed by a company called Healthcare Analytics. Like your credit score, which calculates the level of risk via algorithms and the consumers' credit history, the medical FICO score calculates which patients are more likely to pay their medical bills. Healthcare Analytics is already gathering payment information from large hospitals around the country.
Supposedly the benefit of a patient scoring system is to help hospitals decide whether to write off some delinquent bills as charity cases rather than report them as delinquent accounts. According to msbnc.com, American hospitals face $40 billion in unpaid bills every year.
But with so many people already uninsured (47 million in 2007), and with out-of-pocket costs rising, and two million people filing bankruptcy each year due to medically-related issues, this medFICO is a serious concern for consumers and privacy advocates.
Add to that the frustrations of inaccurate billing, and you've got the same headaches as with the credit bureaus - who also have a dismal 79% error rate (nearly 8 out of 10 credit reports contain serious errors).
Will the doctor or hospital decide not to perform certain services or provide inferior care (ie: reducing the length of stay) after looking at a patient's medFICO score? Will an employer decide not to hire someone because they are too expensive to insure? They SAY these things won't happen, but the risk assessment industry is too lucrative for this information NOT to be used in other ways.
Who is Healthcare Analytics? The investors include Fair Issac Corp. (founder of the FICO scoring model) and Tenet Healthcare Corp., one of the nation's biggest hospital operators. Former Tenet CFO Stephen Farber is its CEO.
The product is not expected to launch commercially until the end of this year.
Don't ever give your SSN to a healthcare provider. They do not need it. They need your member number from insurance, not your SSN. Furthermore, it's illegal for them to ask for your SSN unless they are going to lend you money or hire you.
