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Change Healthcare Suffers From Network Interruption Related To Cyberattack

Change Healthcare, a leading U.S. Healthcare technology company has acknowledged a cyberattack targeting its systems. The company released a brief statement revealing a network disruption stemming from a cybersecurity issue.

Like other previous cases, this is another blow in the healthcare sector. Cybercriminals are getting smarter in exploiting these facilities with weak security protection.

Change Healthcare Cyberattack

Change Healthcare Suffers From Network Interruption Related to Cyberattack (Photo: Louis Reed from Unsplash)The US healthcare giant Change Healthcare is the latest victim of a cyberattack following a sudden network interruption that took place on Wednesday, Feb. 21.

The cyber incident commenced early Wednesday, Feb. 21, on the U.S. East Coast, per the incident tracker. While Change Healthcare did not reveal the specifics of the attack, most of its login pages were inaccessible or offline at the time of reporting.

"Once we became aware of the outside threat, in the interest of protecting our partners and patients, we took immediate action to disconnect our systems to prevent further impact. The disruption is expected to last at least through the day," Change Healthcare wrote on its status page.

Related Article: US Medical Transcription Firm Hit by Cyberattack With Nearly 9 Million Patients' Data Stolen

Local Impact on Michigan Pharmacies

Reports from the Huron Daily Tribune indicate that local pharmacies in Michigan are grappling with disruptions attributable to the Change Healthcare cyberattack.

Scheurer Health, a healthcare provider in Michigan, disclosed on its Facebook page the inability to process prescriptions through patients' insurance due to the "nationwide outage" linked to Change Healthcare.

Change Healthcare's Vital Role in U.S. Healthcare System

Change Healthcare is one of the largest healthcare technology firms in the United States.

Renowned for handling patient payments across the U.S. Healthcare landscape, the company processes a staggering 15 billion healthcare transactions annually. This means that one in every three U.S. Patient records interfaces with Change Healthcare's clinical connectivity solutions.

Merger and Impact

In 2022, UnitedHealth Group finalized the merger of Optum, a U.S. Healthcare services giant, with Change Healthcare in a monumental $7.8 billion transaction. This merger facilitated Optum's extensive access to patient records, positioning it as a pivotal player in the healthcare technology sphere.

Potential Attribution and Response

Amidst the unfolding cyber crisis, Optum spokesperson Andrew Krejci refrained from providing further insights beyond the information available on the incident tracker. However, late Thursday, Feb. 22, UnitedHealth attributed the cyberattack to likely government-backed hackers, although the specific nation-state remains undisclosed.

Despite the severity of the cyber breach, the spokespersons for Change Healthcare and UnitedHealth Group have yet to issue official comments, leaving many questions unanswered amidst growing concerns over the ramifications for the broader U.S. Healthcare ecosystem, per TechCrunch.

Every year, it's becoming alarming that the healthcare sector gets more exposed to security risks. For instance, our early February report said that Viamedis, a French healthcare insurance provider, was hit by a data breach.

At that time, the authorities said that millions of health data were at risk of being compromised or leaked.

Read Also: Cyberattack Forces Hospitals in 5 US States to Shut Down Emergency Rooms

Joseph Henry

After Promising To Make Government Healthcare Data More Accessible, The Biden Administration Now Wants To Clamp Down

In January, the Biden administration pledged to increase public access to a wide array of Medicare information to improve healthcare for America's most sick and vulnerable.

Some Medicare plans' lack of transparency "deprives researchers and doctors of critical data to evaluate problems and trends in patient care," said Xavier Becerra, the secretary of health and human services, in a statement.

So researchers across the country were flummoxed this week when the Centers for Medicare and Medicaid Services announced a proposal that will increase fees and diminish access to claims data that has informed thousands of healthcare studies and influenced major public health reforms.

More than 300 academics — a who's who of health economics researchers — have already signed a draft letter decrying the "catastrophic impact" the new proposal would have on healthcare research. Nearly half of all Americans are covered by Medicare, Medicaid and the Children's Health Insurance Program. Medicare and Medicaid claims contain detailed information about payments for medical care, including diagnoses, treatments and patient demographics.

The CMS data "is a national resource," said Anirban Basu, a professor of health economics at the University of Washington. "It's used for research that helps to develop public policy, that helps in health equality, that plays a role in legislation. Most importantly, such research translates to better health and access for the 160 million CMS beneficiaries."

CMS explained that the changes were aimed at better protecting people's healthcare records, citing "an increase in data breaches across the healthcare ecosystem." In its announcement, the agency did not cite any examples of unauthorized releases of information involving research organizations or universities. However, last year, hackers stole the personal medical information of more than 600,000 Medicare beneficiaries from a CMS contractor.

"Expanding user-friendly, secure access to CMS data continues to be a priority for the agency," said Jonathan Blum, the principal deputy administrator and chief operating officer of CMS, in a statement. He added that the agency "will carefully consider how to best meet stakeholders' data needs while protecting beneficiary data."

Under the current system, academics are able to request claims data for a one-time fee of as little as $20,000 — a price that can increase depending on the amount of information requested. The data is stored on university computers that meet data protection requirements and that allow access to multiple users for a small additional charge.

Researchers have used such data to conduct studies that influenced numerous public healthcare initiatives, including the development and evaluation of the Obamacare program. Just last month, Basu published a paper, using information from the CMS programs, that analyzed the cost-effectiveness of gene therapy treatment for sickle cell disease, a blood disorder that primarily affects people of African descent.

Researchers have also used the data to discover potential abuse and fraud in Medicare and Medicaid — the two programs together account for more than $1.7 trillion in government spending.

The new proposal, however, would force researchers to use a CMS-controlled computer platform to analyze data, instead of distributing it directly to universities and other institutions. Costs would start at an estimated $35,000 and would allow access to only one researcher and require annual renewal fees. Blum noted that researchers, however, would no longer have to bear the costs of storing and securing the data.

Research teams on complex projects can include dozens of people and take years to complete. "The costs will grow exponentially and make access infeasible except for the very best resourced organizations," said Joshua Gottlieb, a professor at the University of Chicago's Harris School of Public Policy. He has used the data to show that when Medicare increases its fees, private insurance companies follow by hiking their own.

One of the major concerns is that higher prices will shut down research by Ph.D. Students and junior faculty, whose budgets typically wouldn't cover a single user fee. "Some important research would be reduced" if the proposal is implemented, Basu said.

Some researchers are also concerned about having to use a government-controlled system to conduct research that may be critical of CMS. Medicare Advantage — a program that allows private insurance companies to pay for healthcare services for the elderly — has come under increasing scrutiny for rising costs.

Another unanswered question is how the CMS computer platform would accommodate additional requests from the thousands of researchers who now use data stored on their own computers. Academics often perform complex statistical analyses on data that require extensive computer time to process.

"It seems crazy to me that given the value of human life and what we spend on healthcare as a country, that the administration would take a step to make research harder not easier," said Zack Cooper, a professor of public health and economics at Yale.

This article originally ran on ProPublica.

Change Healthcare Hack By 'nation-state' Disrupts Pharmacies, Patients

Pharmacist Nidhin Mohan, at the New Island Pharmacy in Deer Park in 2023. Mohan said about 10% to 20% of his customers are affected by the hacking incident. Credit: Kendall Rodriguez

A cyberattack blamed on a "nation-state" is wreaking havoc with prescriptions on Long Island and nationwide, leading to some insurance authorizations not going through and some customers being told to wait for refills until the problem is resolved.

Pharmacies that rely exclusively on Change Healthcare to process insurance claims are reeling, said Heather Ferrarese, board chair of the Pharmacists Society of the State of New York.

"For some pharmacies, it's been completely devastating to their business the past few days," said Ferrarese, co-owner of Bartle's Pharmacy in upstate Oxford.

Change, a subsidiary of the giant Minnesota-based UnitedHealth Group, first publicized the problem early Wednesday morning, and since Thursday has been periodically posting messages through fellow UnitedHealth subsidiary Optum that described a "cyber security issue" that "our experts are working to address."

UnitedHealth said in a filing Thursday with the Securities and Exchange Commission that it "cannot estimate the duration or extent of the disruption at this time."

Optum, with which Change merged in 2022, declined Friday to comment on a timeline.

It's unclear how many prescriptions are impacted by the outage.

At New Island Pharmacy in Deer Park, about 10% to 20% of customers are affected by the breach, said owner and pharmacist Nidhin Mohan.

Mohan said his pharmacy has two servers that connect insurance companies with his computer system, and with the Change server down, he is using one run by competitor RelayHealth. The problems are with customers whose insurance companies or plans don't work with Relay, he said.

When he cannot connect with the insurance companies of long-term customers, Mohan asks the customer to wait until the problem is resolved. But for those who can't wait, he accepts the patient's copay, which he determines from previous transactions. After Change's systems are back online, he will seek reimbursement for the rest of the drug cost from insurance companies.

"I'm hoping that once everything is settled, I can run it through and get my money back," he said.

"If you are using a private pharmacy, if you're using a small mom-and-pop, this works, but if you're with a chain, you're at their mercy," he said.

Mohan is asking newer customers to wait until the problem is resolved, because he does not know their copay.

Ferrarese said there is some risk to pharmacists, because health plans sometimes change, and pharmacists may not have updated deductible and copay information.

"By doing the right thing, and advancing and caring for their patients, they're taking a huge financial risk by putting their neck on the line," said Ferrarese.

CVS, Rite Aid and Walgreens issued statements acknowledging the outage's effect on some claims. CVS said that it implemented a plan to "ensure patients continue to have access to their prescriptions," Rite Aid said it has "successfully processed many of those claims through another billing mechanism," and Walgreens said it has "procedures in place" to fill prescriptions.

But asked whether customers would have to pay the insurance company's share of the medication costs — which can run into the hundreds or even thousands of dollars for some drugs — until Change is back online, all three either declined to comment or did not respond.

Military clinics and hospitals are providing outpatient prescriptions manually and "will give priority to urgent prescriptions followed by routine prescriptions," according to a statement by Tricare, a health care program for nearly 10 million service members, retirees, their families and others.

Some pharmacists use Change to connect with prescribers, and they are not receiving electronic prescriptions, so some are accepting paper scripts, Ferrarese said.

New York law requires electronic prescriptions, but there is an exception for technology-related emergencies, state health department spokeswoman Cadence Acquaviva said in an email.

Change also provides discounts for some medications — including the popular weight-loss drugs Zepbound and Mounjaro, which can be much cheaper with the discounts, Mohan said.

"Everybody who is on that medication who is trying to refill it is having issues with it," he said.

Those discounts are not available during the outage, so Mohan has covered them for long-term customers.

In its Securities and Exchange Commission filing, UnitedHealth said it had "identified a suspected nation-state associated cyber security threat actor [that] had gained access to some of the Change Healthcare information technology systems. Immediately upon detection of this outside threat, the Company proactively isolated the impacted systems."

UnitedHealth "has retained leading security experts, is working with law enforcement and notified customers, clients and certain government agencies," the filing said. "At this time, the Company believes the network interruption is specific to Change Healthcare systems, and all other systems across the Company are operational."

Pharmacies that rely exclusively on Change Healthcare to process insurance claims are reeling, said Heather Ferrarese, board chair of the Pharmacists Society of the State of New York.

"For some pharmacies, it's been completely devastating to their business the past few days," said Ferrarese, co-owner of Bartle's Pharmacy in upstate Oxford.

A cyberattack is leading to some insurance authorizations for prescriptions not going through and Long Islanders having to wait for refills.

UnitedHealth Group, whose subsidiary Change Healthcare was the victim of the attack, blamed a "nation-state" and said it is unclear when the problem will be resolved.

Some independent pharmacies are temporarily covering insurance costs until the outage ends.