In February 2024, United Healthcare subsidiary Change Healthcare fell victim to a devastating ransomware attack. The United Healthcare breach, called the “most significant cyber attack on the U.S. healthcare system” by the American Hospital Association, disrupted vital healthcare operations nationwide.
The attack on Change Healthcare, which processes more than 15 billion transactions yearly—about one-third of U.S. patient records—highlights the constant threat of cyber attacks and the need for preparedness. As an insurance broker, it reminds you that your clients need comprehensive Cyber Insurance—protection you can offer.
The United Healthcare Cyber Attack: A Brief Overview
The United Healthcare cyber attack began on Feb. 21, 2024, and targeted Change Healthcare’s claims processing, billing, and patient eligibility systems. The ransomware attack halted these essential services, affecting more than 131 million patients and nearly 67,000 pharmacies across the United States. The disruption had far-reaching consequences, delaying prescriptions, postponing patient discharges, and delaying paychecks for medical staff.
Financial Fallout: The Cost of the United Healthcare Ransomware Payment
United Healthcare disclosed that the cyber attack cost the company $870 million in the first quarter of 2024 alone. The cost includes nearly $600 million for system restoration and response efforts, with additional losses attributed to revenue disruption and business interruption. The total financial impact is expected to reach between $1.4 billion and $1.6 billion for the year.
In May, United Healthcare CEO Andrew Witty told the U.S. Senate Committee on Finance that the company paid $22 million in Bitcoin to ransomware group Blackcat (also known as ALPHV) to regain access to encrypted data.
Key Lessons for Insurance Brokers
We’ve learned that the United Healthcare breach disrupted healthcare services on a massive scale and compromised millions of trusting customers. The breach has already cost the company a fortune, and class-action lawsuits and SEC and HIPAA fines are likely to follow.
But what can you and your clients learn from this incident? The following actions are important:
Regular Security Audits
The United Healthcare data breach exposed just how crucial regular security audits are. Witty admitted to the committee that hackers exploited stolen credentials to log into a Citrix remote access portal through an account that lacked multifactor authentication (MFA).
In response to Witty’s admission at the hearing, Sen. Thom Tillis, R-N.C., held up a copy of the book “Hacking for Dummies” and said:
“This is some basic stuff that was missed, so shame on internal audit, external audit, and your systems folks tasked with redundancies; they’re not doing their job.”
Become a cyber expert and teach your clients the importance of routine audits and how they can prevent cyber attacks.
Data Backup and Redundancy
The United Healthcare cyber attack drives home the need for secure, accessible data backups. Cyber Insurance brokers, this is your cue: Tell your clients to implement rock-solid backup strategies. We’re talking about offline backups and immutable storage that hackers can’t touch. Redundancy is key—make sure systems and data storage are foolproof to keep operations running smoothly, even during an attack.
Incident Response Planning
A solid incident response plan can mitigate the impact of a cyber attack. United Healthcare’s quick move to restore services and support providers shows why detailed plans are crucial. These plans need clear communication strategies, defined roles, and step-by-step recovery procedures. They ensure your team is ready to act fast when it counts most.
Employee Training and Awareness
Human error remains a leading cause of cyber breaches. Your clients must provide their employees with ongoing cyber security training. Continuous education and training programs covering phishing, social engineering, and secure data handling practices can reduce the likelihood of successful attacks stemming from human mistakes.
ProWriters Protects Your Healthcare Clients From Cyber Attacks
If your clients don’t have Cyber Insurance, they’re taking a huge gamble. Cyber crime is on the rise, and they simply cannot afford to do business without comprehensive coverage.
Whether your clients are in healthcare or other sectors, you can help protect them against cyber attacks like the United Healthcare breach. ProWriters offers comprehensive Cyber Liability Insurance that covers financial losses from cyber attacks or data breaches. It also helps with remediation costs like investigations, crisis communication, and legal services.
For more insight on the impact of cyber crime on healthcare, download our PDF: Why the Healthcare Industry Needs Cyber Insurance. Also, contact us to learn about our many products and how they can help protect your clients and increase your profits.