UnitedHealth Group Remains Under Duress From Change Healthcare Cyberattack, DOJ Investigation

It was a turbulent start to the year for the health care giant UnitedHealth Group, driven by the cyberattack on Change Healthcare and a U.S. Department of Justice (DOJ) antitrust investigation.

Amid the DOJ investigation, UnitedHealth Group’s planned acquisition of the home health company Amedisys Inc. (Nasdaq: AMED) came into focus, with reports circulating that the DOJ was considering an attempt to block that deal specifically.

Signs still suggest that deal is on track to be completed by the end of the year, albeit with certain divestments likely in order for Amedisys.


“We don’t comment on these sorts of matters,” UnitedHealth Group CEO Andrew Witty said Tuesday during the company’s first quarter-earnings call, referring to the DOJ investigation. “I don’t think it would be appropriate to do so today. And certainly we’d never have done in the past. So it’s not something we’re going to get into.”

The Change Healthcare cyberattack, meanwhile, rocked the entire health care industry. But UnitedHealth Group – as the parent company of Change Healthcare – has dealt with the brunt of it.

Change Healthcare provides revenue and payment cycle management, working between payers, providers and patients across the health care system. Since it was hit with a major ransomware attack in February, it has been trying to pick up the pieces. WIRED also reported that UnitedHealth Group paid the ransomware group over $20 million in an attempt to get the problem to go away.


This week, however, a ransomware group suggested it would leak further patient information from the Change Healthcare leak at some point soon if another ransom agreement was not met.

UnitedHealth Group said it took an about $870 million hit in the quarter due to the cyber attack.

“This was an unprecedented attack by a malicious actor on the U.S. health system,” Witty said. “We promptly disconnected the affected services and turned our focus to two main areas: restoration and support. The attack disrupted the ability of care providers to file claims and be paid for their work. We moved quickly to fill this gap. Fortunately, we were able to bring to bear the substantial resources of UnitedHealth Group to drive the recovery and begin to mitigate the impact – resources which a standalone Change Healthcare would not have had access to on its own.”

Witty acknowledged that some care management activities were stalled at the height of the crisis.

“Of the $870 million, about $595 million were direct costs due to the clearinghouse platform restoration and other response efforts, including medical expenses directly relating to the temporary suspension of some care management activities,” UnitedHealth Group President and CEO John Rex said on the call. “For the full year, we estimate these direct costs at $1 billion to $1.15 billion, or $0.85 per share to $0.95 per share.”

Other strategic priorities

Outside of the most pressing issues UnitedHealth Group is facing, there’s also a Medicare Advantage (MA) rate environment that’s forcing health plans – including UnitedHealthcare – to make changes.

But UnitedHealth Group maintains that MA will be an area of growth for it in the future, and that it won’t completely alter its strategy based on contemporary trends.

“2025 is the second year of the significant three-year phased funding reductions to Medicare Advantage introduced by CMS last year,” Witty said. “Here in early 2024, we’re at the beginning of our thoughtful, responsible three-year plan we developed last year to adapt to those changes. Our strategy continues to focus on providing as much stability as possible in the reduced funding environment, improving outcomes and experiences for the consumers we’re privileged to serve and delivering the performance you expect from us.”

Rex also mentioned that the company remains “comfortable” with its benefit offerings.

“We continue to be comfortable with the outlook we established last June, when we filed our 2024 Medicare Advantage benefit offerings,” he said.

Witty also said that OptumHealth is on track to serve “another” 750,000 patients in value-based arrangements in 2024 in partnership with “many payers.”

In the quarter, UnitedHealth Group posted revenues of $99.8 billion, an $8 billion and nearly 9% year-over-year increase. Optum, meanwhile, brought in $61.1 billion, a $7 billion and nearly 13% year-over-year increase.

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