UnitedHealth's first-quarter report will reveal the financial impact of the Change cyberattack.

• The financial impact of the February cyberattack on UnitedHealth Group's Change Healthcare subsidiary may be revealed in the first-quarter earnings report.
• Physician groups are taking out loans to manage their practices due to the outage of the billing and payments processing unit.
• Medicare Advantage health insurers will face greater uncertainty in preparing bids for 2025 plans due in June, as the disruption of real-time data on medical cost trends among seniors affects their ability to accurately forecast costs.

The health care giant's first major public comments since the cyberattack on its Change Healthcare billing and payments subsidiary in February will be during the first-quarter earnings call. This cyberattack has caused the largest disruption in U.S. health care since the Covid pandemic.

JPMorgan's health care analyst, Lisa Gill, stated that United will no longer be viewed as the benchmark for all healthcare services.

The data breach at Change Healthcare's billing and payment processing unit has caused the firm to temporarily shut down its massive service, which has disrupted healthcare providers' operations across the country. Although pharmacies have been able to restore services, the outage has continued to cause problems for healthcare providers.

Optum, a subsidiary of UnitedHealth, has a sprawling division that includes 90,000 doctors under the Optum Care unit and one of the nation's largest pharmacy benefits managers, OptumRx.

Optum's businesses will also be affected by the cyberattack, and analysts will examine how the company handles the costs associated with the attack and its impact on other operations.

Scott Fidel, managing director and health care analyst at Stephens, stated that they will be highly interested in the charge that the estimated lost revenue or additional expenses will be incurred.

Though the American Medical Association states that more than half of physician groups surveyed in early April had to use personal loans to maintain operations, UnitedHealth claims it has provided $4.7 billion in no-interest loans to providers.

Due to delays in processing and payment of claims by private health insurers, Nashville dermatologist James Allred has had to take out loans to keep his practice, Wellskin Dermatology & Aesthetics, afloat. As a result, he has had to abandon his plans to expand his practice this year.

Allred questioned the health of the American healthcare industry's massive consolidation, stating that a single hack could disrupt the entire industry.

Home infusion services firms, like larger providers, have also warned that the outage could affect their quarterly results.

Medicare Advantage uncertainty

The Change hack has caused uncertainty for UnitedHealthcare and its rivals, including Aetna and , as they await their quarterly results on Thursday.

During the fourth quarter, Medicare Advantage insurers experienced higher-than-anticipated medical utilization rates among seniors.

The mid-quarter outage has made it challenging for insurers to monitor medical utilization costs in real-time, and it is likely that most will report adjusted or estimated numbers.

According to Gill, we need to wait until the second quarter to get a clearer picture of the medical cost trend for United and the industry as a whole.

The upcoming Medicare Plan bids for 2025 will be impacted by the delayed outlook on medical costs, which will increase the stakes for health insurers. This follows the disappointing government payment rate increases for 2025, announced earlier this month, which are predicted to negatively affect profits.

"Gill stated that we have high cost trends and a competitive market, which requires them to find a solution."