UnitedHealth Faces Financial Hit After Major Hack
UnitedHealth anticipates a significant impact on its earnings due to a February hack at its tech unit. The company is compensating affected healthcare providers and incurring additional costs for customer notifications. Despite beating second-quarter profit expectations, its shares fell due to increased spending on medical services.
UnitedHealth on Tuesday predicted a substantial impact on this year's earnings following a February cyberattack on its tech unit. The company is offering loans to support affected healthcare providers and facing higher costs related to customer notifications.
Despite exceeding second-quarter profit forecasts, shares of the health insurance giant dropped by 2.4% due to elevated spending on members' medical services, a key metric tracked by investors. UnitedHealth now expects a 30-cent higher impact on full-year adjusted profit due to disruptions from the hack at its Change Healthcare unit.
UnitedHealth attributed the increased expenses to its loan program for providers affected by the cyberattack and the costs of notifying customers about potential data breaches. The hack compromised health insurance member IDs, patient diagnoses, treatment information, and social security numbers, affecting roughly 50% of U.S. medical claims processing. Although the company has restored most services, lingering impacts remain.
(With inputs from agencies.)