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UnitedHealth (UNH) Faces Investigation Following Cyberattack
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UnitedHealth Group (UNH - Free Report) suffered a cyberattack on its revenues and payment cycle management subsidiary, Change Healthcare, last month. The attack sent shockwaves through the healthcare sector in the United States. The breach, which occurred on Feb 21, has prompted the U.S. Department of Health and Human Services (HHS) to launch an investigation into the potential violations of patient data protection laws.
The HHS investigation is yet to determine if there was a breach of protected health data and whether the companies complied with U.S. health privacy laws. This marks the first probe into the incident, reflecting the gravity of the cyberattack's implications for patient privacy and healthcare operations nationwide.
Shares of UNH have lost 6.2% year to date compared with the industry’s 3.2% decline. The S&P 500 gained 8.3% in the same time frame.
Image Source: Zacks Investment Research
The Cyberattack
Change Healthcare, which processes about 50% of medical claims in the United States, is a critical component of the healthcare system, serving around 900,000 physicians, 33,000 pharmacies, 5,500 hospitals and 600 laboratories. The cyberattack has raised concerns about the potential exposure of sensitive patient information, including medical insurance and health data. UnitedHealth has assured that it is working to restore systems, protect data and support those affected by the incident.
As investigations unfold, UNH is grappling with the aftermath of the attack, attributing it to the notorious "Blackcat" ransomware group. While the full scope of the breach remains unclear, the company remains committed to mitigating the incident’s adverse impact and fortifying cybersecurity measures to prevent future attacks.
Ongoing Investigation
The HHS Office for Civil Rights, responsible for enforcing HIPAA rules, is conducting a thorough investigation to determine if UnitedHealth and Change Healthcare complied with the law and assess the extent of the breach. This incident underscores the ongoing challenges posed by cyber threats to the healthcare sector, highlighting the need of robust cybersecurity measures and proactive risk management strategies.
UnitedHealth has pledged its cooperation with the investigation and has emphasized its immediate focus on data protection and system restoration. It is making progress to reduce the harsh impact of cyberattacks on healthcare providers and consumers. UNH restored Change Healthcare’s electronic payments platform and 99% of pharmacy network services, earlier this month. However, the scale of the cyberattack could pose challenges in complying with reporting obligations under HIPAA. Shannon Britton Hartsfield, a healthcare privacy lawyer, highlighted the complexities of identifying and notifying affected individuals, calling it an "extraordinary task."
UnitedHealth currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space are DaVita Inc. (DVA - Free Report) , Cardinal Health, Inc. (CAH - Free Report) and Cencora (COR - Free Report) .
DaVita, carrying a Zacks Rank #1 (Strong Buy) at present, has an estimated long-term growth rate of 12.1%. Its earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 35.6%. You can see the complete list of today’s Zacks #1 Rank stocks here.
DaVita’s shares have risen 32% year to date compared with the industry’s 6.3% growth.
Cardinal Health, carrying a Zacks Rank of 1 at present, has an estimated long-term growth rate of 15.9%. Its earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 15.6%.
CAH’s shares have risen 12% year to date compared with the industry’s 4.8% growth.
Cencora, carrying a Zacks Rank of 2 (Buy) at present, has an estimated long-term growth rate of 9.8%. Its earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 6.7%.
Cencora’s shares have rallied 18% year to date compared with the industry’s 5.8% growth.
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UnitedHealth (UNH) Faces Investigation Following Cyberattack
UnitedHealth Group (UNH - Free Report) suffered a cyberattack on its revenues and payment cycle management subsidiary, Change Healthcare, last month. The attack sent shockwaves through the healthcare sector in the United States. The breach, which occurred on Feb 21, has prompted the U.S. Department of Health and Human Services (HHS) to launch an investigation into the potential violations of patient data protection laws.
The HHS investigation is yet to determine if there was a breach of protected health data and whether the companies complied with U.S. health privacy laws. This marks the first probe into the incident, reflecting the gravity of the cyberattack's implications for patient privacy and healthcare operations nationwide.
Shares of UNH have lost 6.2% year to date compared with the industry’s 3.2% decline. The S&P 500 gained 8.3% in the same time frame.
Image Source: Zacks Investment Research
The Cyberattack
Change Healthcare, which processes about 50% of medical claims in the United States, is a critical component of the healthcare system, serving around 900,000 physicians, 33,000 pharmacies, 5,500 hospitals and 600 laboratories. The cyberattack has raised concerns about the potential exposure of sensitive patient information, including medical insurance and health data. UnitedHealth has assured that it is working to restore systems, protect data and support those affected by the incident.
As investigations unfold, UNH is grappling with the aftermath of the attack, attributing it to the notorious "Blackcat" ransomware group. While the full scope of the breach remains unclear, the company remains committed to mitigating the incident’s adverse impact and fortifying cybersecurity measures to prevent future attacks.
Ongoing Investigation
The HHS Office for Civil Rights, responsible for enforcing HIPAA rules, is conducting a thorough investigation to determine if UnitedHealth and Change Healthcare complied with the law and assess the extent of the breach. This incident underscores the ongoing challenges posed by cyber threats to the healthcare sector, highlighting the need of robust cybersecurity measures and proactive risk management strategies.
UnitedHealth has pledged its cooperation with the investigation and has emphasized its immediate focus on data protection and system restoration. It is making progress to reduce the harsh impact of cyberattacks on healthcare providers and consumers. UNH restored Change Healthcare’s electronic payments platform and 99% of pharmacy network services, earlier this month. However, the scale of the cyberattack could pose challenges in complying with reporting obligations under HIPAA. Shannon Britton Hartsfield, a healthcare privacy lawyer, highlighted the complexities of identifying and notifying affected individuals, calling it an "extraordinary task."
UnitedHealth Group Incorporated Price
UnitedHealth Group Incorporated price | UnitedHealth Group Incorporated Quote
Zacks Rank & Stocks to Consider
UnitedHealth currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space are DaVita Inc. (DVA - Free Report) , Cardinal Health, Inc. (CAH - Free Report) and Cencora (COR - Free Report) .
DaVita, carrying a Zacks Rank #1 (Strong Buy) at present, has an estimated long-term growth rate of 12.1%. Its earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 35.6%. You can see the complete list of today’s Zacks #1 Rank stocks here.
DaVita’s shares have risen 32% year to date compared with the industry’s 6.3% growth.
Cardinal Health, carrying a Zacks Rank of 1 at present, has an estimated long-term growth rate of 15.9%. Its earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 15.6%.
CAH’s shares have risen 12% year to date compared with the industry’s 4.8% growth.
Cencora, carrying a Zacks Rank of 2 (Buy) at present, has an estimated long-term growth rate of 9.8%. Its earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 6.7%.
Cencora’s shares have rallied 18% year to date compared with the industry’s 5.8% growth.