I see several steps that need to be taken in your situation. 

1. File an Identity Theft Affidavit with the IRS as soon as possible. You can do it using this website or by submitting Form 14039. 

2. I suggest that you report the gross proceeds that are reported on Form 1099-B on your tax return and then use the cost basis to match the proceeds to show zero gain/loss. Of course, you need to do that only for the fraudulent transactions. I would also include a statement to the return that explains what happened, as well as the online submitted form or Form 14039 from #1 above.  This will mean that you have to print and mail your tax return. 

3. You also want to inform your financial institution about the fraudulent transactions if you haven't done that yet. They might send you a corrected 1099-B.

4. As for Medicare, if you do not show gain/loss on your tax return as I am suggesting in #1, there will be no inflated income, and thus no changes for Medicare. However, if that is not the case, you could file Form SSA-44, which requests an adjustment based on a life-changing event.