Almost all US hospitals took financial hit from Change hack, AHA says

FILE PHOTO: The corporate logo of the UnitedHealth Group appears on the side of one of their office buildings in Santa Ana, California

By Amina Niasse

NEW YORK (Reuters) - Almost all U.S. hospitals were hurt financially by the cyberattack on United Health Group’s Change Healthcare unit earlier this year, according to a survey from the American Hospital Association (AHA).

The AHA said that 94% of hospitals reported damage to cash flow and more than half reported significant or serious financial damage due to Change's inability to process claims.

"While this event had disparate impacts on providers, all communities felt the effects in some way," the AHA wrote in a letter to leadership of the U.S. Senate Finance and House Energy and Commerce committees.

The association, which represents almost 5,000 hospitals and healthcare systems in the United States, sent the letter on Monday ahead of Wednesday's Congressional hearings on cybersecurity vulnerabilities in the healthcare sector.

UnitedHealth CEO Andrew Witty is slated to testify before both committees following weeks of disruption to American healthcare since the insurer's Change Healthcare unit was hacked.

The hearings follow a security probe by the U.S. government into Change Healthcare, which operates the country's largest payment management system for healthcare providers.

On the morning of Feb. 21, the cybercriminal gang AlphV, aka BlackCat, locked up Change Healthcare's systems and demanded a ransom to unlock them, Witty will tell the House panel, according to a copy of his written testimony posted to the panel's website on Monday.

UnitedHealth Group has made $6.5 billion in accelerated payments and loans to providers, including hospitals, since the February attack, the CEO will testify.

The AHA said in a separate announcement on Tuesday that some providers have had to take out high-interest loans, despite the cash infusions from the healthcare giant.

"UnitedHealth Group and other insurers have held on to premium dollars, collecting as-yet unknown amounts of interest on what they have not paid out to providers," the AHA wrote to Congress on Monday.

(Reporting by Amina Niasse; Editing by MIchael Erman)