UnitedHealth Says Pharmacy Network Is Now Connected - Legal Wrangles Mount as Change Healthcare Grapples With Cyberattack

UnitedHealth Group’s UNH subsidiary Change Healthcare’s pharmacy network has been reinstated following a cyberattack that had widespread repercussions on the nation’s healthcare infrastructure, heavily reliant on insurance. 

Citing the company, Reuters noted that as of March 13, all major pharmacy and payment systems are up, and more than 99% of pre-incident claim volume is flowing.

This development comes amidst a flurry of legal actions against UnitedHealth, as the company faces at least six class action lawsuits stemming from the breach of Change Healthcare’s systems. 

Plaintiffs’ lawyers are seeking consolidation of these cases in federal court in Nashville, Tennessee, where Change Healthcare is headquartered, anticipating further litigation to emerge.

In February, UnitedHealth identified a suspected nation-state-associated cyber security threat actor that had gained access to some of the Change Healthcare information technology systems. 

The hackers affiliated with the ‘Blackcat’ ransomware gang were responsible for the outage at UnitedHealth’s technology unit, causing significant disruptions to prescription deliveries.

While the full extent of the breach remains uncertain, plaintiffs allege that patients’ personal information, including medical records, payment details, and Social Security numbers, is at risk, Reuters noted. 

The disruption caused by the attack has left healthcare providers, ranging from major hospital systems to small medical practices and pharmacies, unable to process payments, thus impeding critical healthcare services.

In response to the crisis, UnitedHealth Group has prioritized restoring Change Healthcare’s operations, aiming to resume payment processing by March 15 and reestablish connectivity to the claims network and software by March 18. 

Despite these efforts, the lawsuits persist, accusing Change Healthcare of negligence and violations of privacy laws, including the Health Insurance Portability and Accountability Act.

Wednesday, the U.S. Department of Health and Human Services opened an investigation into the cyber-attack.

Reuters highlighted that Change Healthcare processes about 50% of medical claims in the U.S. for around 900,000 physicians, 33,000 pharmacies, 5,500 hospitals, and 600 laboratories.

Price Action: UNH shares are down 0.13% at $487.36 on the last check Thursday.