What characterizes medical identity theft?

Medical identity theft is characterized by the knowing transfer or use of health information to commit unlawful activities. This is a serious issue where an individual's personal health information is used without their consent, typically to obtain medical services or goods fraudulently. The essence of medical identity theft lies in the intent to use someone else's identity to exploit healthcare resources, leading to potential financial damage and the wrongful documentation of a person’s medical history.

While unauthorized sharing of health information could occur in various privacy breaches, it doesn't necessarily imply an intent to commit a crime. Accidental disclosure and the collection of patient information for research, when done correctly and ethically, do not fall under the definition of identity theft, as they do not involve malicious intent or use for illegal purposes. In contrast, the act of using health data to engage in illegal activities is the core element that defines medical identity theft, making the second option the correct identification of this crime.