Cyberattack on healthcare claims processor costing hospitals $2 billion a week in cash flow, Kodiak Solutions data show
Real-time claims data shows outbound claims have dropped by more than a third since Feb. 21 cyberattack
INDIANAPOLIS, March 13, 2024--(BUSINESS WIRE)--Hospitals, health systems and medical practices are beginning to feel the financial impact of a cyberattack on a widely used payment processor, as proprietary Kodiak Solutions data show that claims to payers have dropped by more than a third since the Feb. 21 cyberattack on Change Healthcare.
Data from more than 1,850 hospitals and 250,000 physicians shows the immediate effects of the cyberattack on outgoing claims: The weekly estimated cash value of claims by the providers in the Kodiak Revenue Cycle Analytics (RCA) database dropped by more than a quarter in the first impacted week and now has fallen to 63% of the expected baseline, according to RCA data.
The cash flow impact of those delayed claims has ranged from $1.84 billion in the first week to $2.53 billion in the latest full week, compared with the baseline—the average of the weekly estimated cash value of claims from Jan. 1 through Feb. 17. The total estimated cash flow impact for the hospitals reporting data to Kodiak RCA through March 9 is $6.3 billion in payments that are delayed.
"The impact from the cyberattack showed up immediately in our claims data, and it will soon show up in reduced cash flow to hospitals, health systems and medical practices across the nation," said Colleen Hall, senior vice president and Revenue Cycle leader at Kodiak Solutions. "Providers already are struggling to collect payments for medical services, with bad debt on commercial insurance claims reaching nearly 1.8%, according to our proprietary data.
"And the impact will grow over time, even after claims processing returns to normal," Hall added. "We expect this interruption of claims processing to also increase insurance denials for medical necessity, prior authorization and timely filing."
Hall made additional comments on the impact of the cyberattack (VIDEO) during Kodiak Solutions’ Healthcare Virtual Symposium today.
Kodiak RCA software monitors every patient financial transaction from more than 1,850 hospitals and 250,000 physicians nationwide.
About Kodiak Solutions
Kodiak Solutions is a leading technology and tech-enabled services company that simplifies complex business problems for healthcare provider organizations. For nearly two decades as a part of Crowe LLP, Kodiak created and developed our proprietary net revenue reporting solution, Revenue Cycle Analytics. Kodiak also provides a broad suite of software and services in support of CFOs looking for solutions in financial reporting, revenue cycle, risk and compliance, and unclaimed property. Kodiak’s 400 employees engage with more than 1,850 hospitals and 250,000 practice-based physicians, across all 50 states, and serve as the unclaimed property outsourcing provider of choice for more than 2,000 companies. To learn more, visit our website.
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