Jul 16, 2024 - Health

UnitedHealth Group projects cyberattack costs to top $2.3B

Tina Reed

UnitedHealth Group CEO Andrew Witty testifying in front of a Congressional Committee on May 1. — UnitedHealth CEO Andrew Witty testifies before the Senate Finance Committee on Capitol Hill on May 1. Photo: Kent Nishimura/Getty Images

UnitedHealth Group expects costs from the massive cyberattack against its Change Healthcare unit to reach $2.3 billion to $2.45 billion this year, the company said in a second quarter earnings report on Tuesday.

Why it matters: That eclipses earlier projections by more than $1 billion and amounts to a drag of $0.60 to $0.70 cents per share on earnings from business disruptions.

The big picture: The company suffered one of the largest health care breaches in history in February, disrupting the processing of claims and payments to health providers for weeks.

As many as one in three Americans may have had their data breached in the ransomware attack, stoking fears of widespread fraud and identity theft.

By the numbers: The company said its direct response costs are estimated at $1.30 to $1.35 a share, up $0.40 to $0.45 from the initial estimate.

The change stems from financial support to affected providers and consumer notification costs.

The big picture: The company nevertheless posted profits of $4.2 billion in the second quarter ended June 30, beating Wall Street expectations but still down from $5.4 billion a year earlier due to the cyberattack.

Revenues were $98.9 billion, up nearly $6 billion year over year, led by the company's OptumRx pharmacy benefit manager subsidiary.

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UnitedHealth Group projects cyberattack costs to top $2.3B

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