Change Healthcare

History

2024: Payment of $22 million to ransomware hackers to prevent patient data from being leaked

On April 22, 2024, UnitedHealth Group, the largest US health insurance company, announced that it was forced to pay ransomware hackers approximately $22 million to prevent the leakage of patient data. Confidential information was stolen in an attack on a subsidiary of Change Healthcare.

The invasion of the IT infrastructure of Change Healthcare took place in February 2024. The cybercriminal group BlackCat, also known as AlphV, is reportedly behind the attack. The attackers stole a large array of medical and personal information, after which they demanded a ransom for non-disclosure of this information.

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The ransom was paid as part of the company's commitment to do everything possible to protect patient data from disclosure, UnitedHealth Group, which serves more than 152 million customers, said in a statement.

The company said that as of April 2024, 22 screenshots of allegedly compromised files have been released on the darknet. UnitedHealth Group continues to work with law enforcement to investigate the incident. The company has formed a dedicated customer support center that will provide free identity theft protection and credit monitoring for two years.

It is noted that a hacker attack on Change Healthcare actually provoked paralysis of the American medical system. Hundreds of hospitals and other health facilities across the country have been affected. Doctors could not write prescriptions and receive payment for their services. Experts call this invasion the largest incident in the US healthcare industry, provoked by the introduction of a ransomware program. Change Healthcare says it lost $872 million in the invasion.^[1]

2021: Optum bought Change Healthcare

In early January 2021, the sale of Change Healthcare to UnitedHealth Group subsidiary Optum was announced. The transaction value was $13 billion. The combined company after the closing of the transaction will focus on the development, software tools for data analysis and various services to customers from the sphere. health care

It is known that UnitedHealth will pay $25.75 per share in cash, which is 41% more than Change Healthcare's closing price as of January 5 ($18.24). Given that Change Healthcare's debt exceeds $5 billion, the deal is worth about $13 billion.

Optum acquires Change Healthcare

This will be one of the largest acquisitions by UnitedHealth, which intends to significantly expand its healthcare business with the help of Optum's division. UnitedHealth and Change Healthcare said the deal would help them simplify healthcare delivery, improve customer satisfaction and reduce costs.

Change Healthcare CEO Neil de Crescenzo will lead the combined business unit as CEO of OptumInsight. At the same time, however, OptumInsight is the smallest business unit by revenue within Optum. The division's revenue for the three months ended September 30, 2020 amounted to about $2.8 billion. The revenue of Change Healthcare itself for the same period amounted to $765 million.

The deal is expected to close in the second half of 2021. Private equity funds affiliated with Blackstone Group, which owns about a 20% stake in Change Healthcare, agreed to vote for the deal. UnitedHealth's adjusted earnings per share are expected to increase by $0.50 by 2022.^[2]

2019: Non-Nasdaq Exit Plans Statement

In late June 2019, plans were officially announced for Change Healthcare to enter the Nasdaq exchange under the ticker symbol CHNG.

2016: McKesson hands IT-Business to JV with Change Healthcare

At the end of June 2016, it became known about McKesson's plans to separate its IT medicine business into a joint venture (JV) with the developer of software and network solutions for medical institutions Change Healthcare Holdings. The new company is planned to be put on the stock exchange.

Under the terms of the agreement, almost all assets of the IT division of McKesson Technology Solutions will be transferred to the joint company, with the exception of the business in the field of corporate IT services and the RelayHealth Pharmacy department, which is engaged in the development of a "smart" network of solutions that ensure the interaction of patients, hospitals, pharmaceutical companies and financial institutions. McKesson has also begun to consider strategic options for further business development in the provision of IT services to hospitals.

One of the largest pharmaceutical companies in the United States separates the IT-Business

The JV will be 70% owned by McKesson and the remainder owned by Change Healthcare Holdings shareholders. The annual revenue of the new company is estimated at $3.4 billion. The deal is scheduled to close in the first half of 2017.

A few months after completing all the formalities regarding the amalgamation of McKesson and Change Healthcare assets, the new company will be listed. It will be headed by Change Healthcare CEO Neil de Crescenzo. In the future, McKesson intends to withdraw its investments from this company.

In June 2016, Reuters, citing knowledgeable sources, reported that McKesson was considering separating its IT division, including through the sale and conclusion of an asset pooling deal.^[3]

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