‘We’re hemorrhaging money’: US health clinics try to stay open after unprecedented cyberattack

‘We’re hemorrhaging money’: US health clinics try to stay open after unprecedented cyberattack - Business and Finance - News

Title: The Devastating Impact of the Change Healthcare Cyberattack on American Health Care Providers: A Financial Crisis Exposing the Fragility of the Billing System

The United States health care sector has been facing an unprecedented crisis for over two weeks as a result of a cyberattack on Change Healthcare, a company that plays a crucial role in the functioning of America’s health care market. The disruption to Change Healthcare’s computer networks has affected thousands of hospitals, insurers, and pharmacies across the country, leaving many health care providers grappling with financial losses and the prospect of closure.

The Foot and Ankle Specialty Center in suburban Philadelphia is one such clinic that has been severely impacted by this cyberattack. Catherine Reinheimer, the practice manager, expressed her concerns to CNN, stating that the center is “hemorrhaging money” and might have to let go of full-time employees due to a lack of funds. The clinic is considering taking out a loan to keep the business running.

Change Healthcare, which is part of UnitedHealth, serves as the central nervous system of the US health care market. Its services enable doctors to verify patients’ insurance details, pharmacies to process prescriptions, and clinics to submit claims for reimbursement. However, the cyberattack has disrupted these services, causing prescription drug insurance payments to halt and leaving care providers footing the bill without any reimbursement.

Health care groups have appealed to the Department of Health and Human Services (HHS) for financial assistance, but according to a statement released on Tuesday, the department is taking steps to help process claims. Some care providers, however, feel that these efforts are not nearly enough to alleviate their financial strain.

Mel Davies, the chief financial officer of Oregon Oncology Specialists, which treats over 16,000 cancer patients annually, shared her concerns with CNN regarding the potential closure of her clinic if she does not receive financial relief soon. Cash flow has dropped by 50% since the cyberattack, and the situation is “off the charts” in terms of its magnitude for her clinic.

Change Healthcare announced plans to have its electronic payment platform back contact by March 15 and the claims processing network restored the following week. However, the financial repercussions of this cyberattack will take a significant amount of time to address.

Jesse Ehrenfeld, president of the American Medical Association, emphasized the need for economic assistance to physicians in light of this situation. Change Healthcare’s plan to restore systems is a welcome development, but it does not immediately address the financial challenges faced by health care providers.

The cyberattack on Change Healthcare has led to a reckoning for senior US cybersecurity officials regarding the vulnerabilities in companies that underpin the health care system. This incident represents an evolution beyond past ransomware attacks on individual hospitals, highlighting the critical need for identifying and protecting systemically important entities in the health care sector.

Health care executives have raised concerns about the severe financial impact of this cyberattack on their organizations and the potential for significant cash flow problems. The ransomware attack has had a devastating effect on cancer practices and their patients, according to the Community Oncology Alliance.

Change Healthcare has attributed the hack to ALPHV or BlackCat, a multinational ransomware gang responsible for several attacks on victims worldwide. The group reportedly received a $22 million payment in connection to the Change Healthcare attack, but it is unclear who made this payment.

For cybersecurity expert Joshua Corman, the Change Healthcare cyberattack underscores the need for a more resilient US health sector in crisis situations. Acquisitions that have merged multibillion-Dollar healthcare companies have accentuated this problem, making it crucial for federal officials to identify systemically important entities before adversaries do.

The cyberattack on Change Healthcare has caused significant financial damage, potentially costing the company billions of dollars in lost revenue and clients. The consequences of this incident serve as a reminder of the importance of robust cybersecurity measures to protect critical infrastructure and ensure the stability of essential industries like health care.