Initially thought to be an attack by a nation-state, actual culprit turned out to be a known ransomware group and each day brings new revelations about the cyberattack
Fallout continues from cyberattack on Change Healthcare, the revenue cycle management (RCM) company that is a business unit of Optum, itself a division of UnitedHealth Group. Recent news accounts say providers are losing an estimated $100 million per day because they cannot submit claims to Change Healthcare nor receive reimbursement for these claims.
The cyberattack took place on February 21. The following day, UnitedHealth Group filed a Material Cybersecurity Incidents report (form 8-K) with the US Securities and Exchange Commission (SEC) in which it stated it had “identified a suspected nation-state associated cybersecurity threat actor [that] had gained access to some of the Change Healthcare information technology systems.”
A few days later the real identity of the threat actor was revealed to be a ransomware group known as “BlackCat” or “ALPHV,” according to Reuters.
Change Healthcare of Nashville, Tenn., is “one of the largest commercial prescription processors in the US,” Healthcare Dive reported, adding that hospitals, pharmacies, and military facilities had difficulty transmitting prescriptions “as a result of the outage.”
Change Healthcare handles about 15 billion payments each year.
According to a Change Healthcare statement, the company “became aware of the outside threat” and “took immediate action to disconnect Change Healthcare’s systems to prevent further impact.”
Change Healthcare has provided a website where parties that have been affected by the cyberattack can find assistance and updated information on Change’s response to the intrusion and theft of its data.
“The fallout is only starting to happen now. It will get worse for consumers,” Andrew Newman (above), founder and Chief Technology Officer, ReasonLabs, told FOX Business, adding, “We know that the likely destination for [the Change Healthcare] data is the Dark Web, where BlackCat will auction it all off to the highest bidder. From there, consumers could expect to suffer from things like identity theft, credit score downgrades, and more.” Clinical laboratories are also targets of cyberattacks due to the large amount of private patient data stored on their laboratory information systems. (Photo copyright: ReasonLabs.)
Millions of Records May be in Wrong Hands
Reuters reported that ALPHV/BlackCat admitted it “stole millions of sensitive records, including medical insurance and health data from the company.”
The ransomware group has been focusing its attacks on healthcare with 70 incidents since December, according to federal agencies.
In a letter to HHS, AHA warned, “Change Healthcare’s downed systems will have an immediate adverse impact on hospital finances. … Their interrupted technology controls providers’ ability to process claims for payment, patient billing, and patient cost estimation services.”
“My understanding is Change/Optum touches almost every hospital in the US in one way or another,” John Riggi, AHA’s National Advisor for Cybersecurity and Risk, told Chief Healthcare Executive. “It has sector wide impact in potential risk. So, really, this is an attack on the entire sector.” Riggi spent nearly 30 years with the FBI.
Some physician practices may also have been impacted by the Change Healthcare cyberattack, according to the Medical Group Management Association (MGMA). In a letter to HHS, MGMA described negative changes in processes at doctors’ offices. They include delays in paper and electronic statements “for the duration of the outage.”
In addition, “prescriptions are being called into pharmacies instead of being electronically sent, so patients’ insurance information cannot be verified by pharmacies, and [the patients] are forced to self-pay or go without necessary medication.”
Here are “just a few of the consequences medical groups have felt” since the Change Healthcare cyberattack, according to the MGMA:
Substantial billing and cash flow disruptions, such as a lack of electronic claims processing. Both paper and electronic statements have been delayed. Some groups have been without any outgoing charges or incoming payments for the duration of the outage.
Limited or no electronic remittance advice from health plans. Groups are having to manually pull and post from payer portals.
Prior authorization submissions have been rejected or have not been transmittable at all. This further exacerbates what is routinely ranked the number one regulatory burden by medical groups and jeopardizes patient care.
Groups have been unable to perform eligibility checks for patients.
Many electronic prescriptions have not been transmitted, resulting in call-in prescriptions to pharmacies or paper prescriptions for patients. Subsequently, patients’ insurance information cannot be verified by pharmacies, and they are forced to self-pay or go without necessary medication.
Lack of connectivity to important data infrastructure needed for success in value-based care arrangements, and other health information technology disruptions.
Medical laboratory leaders and pathologists are advised to consult with their colleagues in IT and cybersecurity on how to best prevent ransomware attacks. Labs hold vast amount of private patient information. Recent incidents suggest more steps and strategies may be needed to protect laboratory information systems and patient data.
Some hospital organizations are pushing back, stating that the new regulations are ‘too rigid’ and interfere with doctors’ treatment of patients
In August, the Biden administration finalized provisions for hospitals to meet specific treatment metrics for all patients with suspected sepsis. Hospitals that fail to meet these requirements risk the potential loss of millions of dollars in Medicare reimbursements annually. This new federal rule did not go over well with some in the hospital industry.
Sepsis kills about 350,000 people every year. One in three people who contract the deadly blood infection in hospitals die, according to the Centers for Disease Control and Prevention (CDC). Thus, the federal government has once again implemented a final rule that requires hospitals, clinical laboratories, and medical providers to take immediate actions to diagnose and treat sepsis patients.
The effort has elicited pushback from several healthcare organizations that say the measure is “too rigid” and “does not allow clinicians flexibility to determine how recommendations should apply to their specific patients,” according to Becker’s Hospital Review.
Perform blood tests within a specific period of time to look for biomarkers in patients that may indicate sepsis, and to
Administer antibiotics within three hours after a possible case is identified.
It also mandates that certain other tests are performed, and intravenous fluids administered, to prevent blood pressure from dipping to dangerously low levels.
“These are core things that everyone should do every time they see a septic patient,” said Steven Simpson, MD, Professor of medicine at the University of Kansas told Fierce Healthcare. Simpson is also the chairman of the Sepsis Alliance, an advocacy group that works to battle sepsis.
Simpson believes there is enough evidence to prove that the SEP-1 guidelines result in improved patient care and outcomes and should be enforced.
“It is quite clear that this works better than what was present before, which was nothing,” he said. “If the current sepsis mortality rate could be cut by even 5%, we could save a lot of lives. Before, even if you were reporting 0% compliance, you didn’t lose your money. Now you actually have to do it,” Simpson noted.
“We are encouraged by the increased attention to sepsis and support CMS’ creation of a sepsis mortality measure that will encourage hospitals to pay more attention to the full breadth of sepsis care,” Chanu Rhee, MD (above), Infectious Disease/Critical Care Physician and Associate Hospital Epidemiologist at Brigham and Women’s Hospital told Healthcare Finance. The new rule, however, requires doctors and medical laboratories to conduct tests and administer antibiotic treatment sooner than many healthcare providers deem wise. (Photo copyright: Brigham and Women’s Hospital.)
Healthcare Organizations Pushback against Final Rule
“By encouraging the use of broad spectrum antibiotics when more targeted ones will suffice, this measure promotes the overuse of the antibiotics that are our last line of defense against drug-resistant bacteria,” the AHA’s letter states.
In its recent coverage of the healthcare organizations’ pushback to CMS’ final rule, Healthcare Finance News explained, “The SEP-1 measure requires clinicians to provide a bundle of care to all patients with possible sepsis within three hours of recognition. … But the SEP-1 measure doesn’t take into account that many serious conditions present in a similar fashion to sepsis … Pushing clinicians to treat all these patients as if they have sepsis … leads to overuse of broad-spectrum antibiotics, which can be harmful to patients who are not infected, those who are infected with viruses rather than bacteria, and those who could safely be treated with narrower-spectrum antibiotics.”
CMS’ latest rule follows the same evolutionary path as previous federal guidelines. In August 2007, CMS announced that Medicare would no longer pay for additional costs associated with preventable errors, including situations known as Never Events. These are “adverse events that are serious, largely preventable, and of concern to both the public and healthcare providers for the purpose of public accountability,” according to the Leapfrog Group.
In 2014, the CDC suggested that all US hospitals have an antibiotic stewardship program (ASP) to measure and improve how antibiotics are prescribed by clinicians and utilized by patients.
Research Does Not Show Federal Sepsis Programs Work
He points to analysis which showed that though use of broad-spectrum antibiotics increased after the original 2015 SEP-1 regulations were introduced, there has been little change to patient outcomes.
“Unfortunately, we do not have good evidence that implementation of the sepsis policy has led to an improvement in sepsis mortality rates,” Rhee told Fierce Healthcare.
Rhee believes that the latest regulations are a step in the right direction, but that more needs to be done for sepsis care. “Retiring past measures and refining future ones will help stimulate new innovations in diagnosis and treatment and ultimately improve outcomes for the many patients affected by sepsis,” he told Healthcare Finance.
Sepsis is very difficult to diagnose quickly and accurately. Delaying treatment could result in serious consequences. But clinical laboratory blood tests for blood infections can take up to three days to produce a result. During that time, a patient could be receiving the wrong antibiotic for the infection, which could lead to worse problems.
The new federal regulation is designed to ensure that patients receive the best care possible when dealing with sepsis and to lower mortality rates in those patients. It remains to be seen if it will have the desired effect.
As a result, health system-based clinical laboratories likely saw a decline in test orders as well a decrease in outreach revenue
Bad financial news continues in the hospital industry. According to an August 2023 National Hospital Flash Report from consulting firm Kaufman Hall, hospitals’ financial performance deteriorated in July, partly due to declines in inpatient and outpatient volumes and rising bad debt and charity care.
The implication from these findings is that hospital-based clinical laboratories saw a drop in test volume and any lab revenue associated with inpatient testing.
In an analysis of data from more than 1,300 hospitals, Kaufman Hall noted a dip in hospitals’ median calendar year-to-date operating margin from 1.4% in June down to 1.3% in July. The data also showed “a greater pullback in volume on the outpatient side, which may be attributed to patients choosing not to pursue elective procedures during the summer,” a Kaufman Hall news release stated.
Kaufman Hall’s National Hospital Flash Report by Erik Swanson, Senior Vice President, Data and Analytics, and Brian Pisarsky, Senior Vice President, Strategic and Financial Planning, is an analysis of actual and budget data—sampled from Syntellis Performance Solutions—which is representative of hospitals of various sizes and areas in the US.
“It’s clear that today’s challenging financial environment is here to stay, and hospital leaders must be proactive in seeking out opportunities to refine their operations and remain competitive,” said Erik Swanson, Senior Vice President, Data and Analytics, Kaufman Hall, in a news release. Clinical laboratory leaders would be wise to follow the same advice. (Photo copyright: Kaufman Hall.)
Expenses Declined, Bad Debt and Charity Care Rose
Here are other national data Kaufman Hall reported for July 2023 as compared to June 2023:
Adjusted discharges per calendar day dropped 7%.
Operating room minutes per calendar day declined 13%.
Emergency department visits per calendar day fell 1%.
Bad debt and charity care as a percentage of hospitals’ gross operating revenue was up 7%.
Purchased service expense per adjusted discharge was down 3%.
Labor expense per adjusted discharge also fell 3%.
Even though expenses slightly declined during July, patient volume decreases “pulled down” the margins, Healthcare Innovation reported, which called the report “a gloomy one.”
Also, the uptick in bad debt and charity care while volumes decreased created a “difficult situation for hospitals,” Medical Economics observed.
Here are the report’s “key takeaways,” according to Kaufman Hall:
All volume indicators were down, but operating margins were still better than 2022.
Outpatient volume decreased more than inpatient, possibly due to patients choosing not to have elective procedures during the summer.
The decline in expenses was “not enough to offset revenue losses,” and inflation will continue to take its toll on labor expenses.
Medicaid has been “disenrolling” members in 30 states during June and July, and bad debt and charity care have increased.
The report also called out need for improvement in providers’ discharge of patients to skilled nursing facilities. “Hospitals that prioritize care transitions to skilled nursing facilities are performing better than institutions [that] do not,” Swanson said in the news release.
“Identifying steps that can ensure a smooth transition, such as obtaining pre-authorizations and planning discharge early, will help organizations reduce expenses and improve patients’ experience,” he continued.
For Hospitals, 2023 Not as Bad as 2022
MedCity News pointed out that though July’s operating margin index decline followed four months of growth, hospitals are still way ahead of 2022 performance when median operating margins were -0.98% in July 2022.
Still, it appears hospitals are struggling to secure financial footing after 2022, an overall bad financial year for the hospital industry.
More recently, a 2023 Becker’s Hospital CFO Report compiled a list of 81 hospitals that had cut jobs since the start of the year in response to “financial and operational challenges.”
Included was Tufts Medicine in Burlington, Massachusetts. In August, the hospital “eliminated hundreds of jobs” in an outsourcing of lab outreach services to Labcorp. The Becker’s report noted that “[Tufts] said it will work with Labcorp to have the majority of affected employees transition to a similar position with Labcorp.”
Tips for Clinical Lab Financial Viability
Medical laboratory leaders need to help ensure financial health of their labs as well as quality and efficiency of services. Advice from Kaufman Hall may be applicable.
The report writers advised providers to secure payer authorizations before a “patient comes in the door.” For clinical labs, this is comparable to the need to secure insurance company authorizations for expensive genetic tests before samples are taken and tests performed.
Another tip from Kaufman Hall is to “collect and use data to inform process improvement” and “make change.” Along those lines, medical laboratories could leverage patient data to guide launch of new services, entry to markets, workflow improvement, and costs reduction.
Proposed regulation to limit rate increases during health crises gets pushback from staffing agencies and travel nurses who disagree with salary restrictions
Hospitals across the nation are seeking relief from skyrocketing costs due to increased demand for temporary workers—especially travel nurses. This has led organizations like the American Hospital Association (AHA) to step in and call for legislators to cap spiking salary rates. Many clinical laboratories report similar increases in salaries following the outbreak of SARS-CoV-2 for medical technologists (MTs), clinical laboratory scientists (CLSs), histologists, and other skilled positions. This increase in salaries of lab scientists was mirrored by an even greater increase in the cost of travel MTs.
According to analysis conducted by Becker’s Hospital Review of hiring data from Vivian Health, an online job placement website for healthcare professionals, “Average weekly travel nurse pay climbed from $1,896 in January 2020 to $3,782 in December 2021, a 99.47% increase.”
A prior study by Kaufman Hall and Associates, LLC., found rates for temporary workers almost 500% higher than pre-pandemic times. While numbers are trending downward, it’s clear that rates are still high enough to cause alarm, KFF Health News reported.
“During the pandemic there were staffing companies who were making a lot of promises and not necessarily delivering,” Dave Dillon (above), VP of Public and Media Relations at Missouri Hospital Association, told KFF Health News. “It created an opportunity for both profiteering and for bad actors to be able to play in that space.” (Photo copyright: L.G. Patterson/Missouri Hospital Association.)
AHA Alleges Price Gouging
Demand for temporary healthcare workers surged during the COVID-19 pandemic, and, because supply was limited, salaries for temporary workers—such as travel nurses—soared as well. This dramatic increase in hospitals’ costs prompted the AHA in 2021 to send a letter to the Federal Trade Commission seeking relief for healthcare providers from what the organization called “anticompetitive pricing by nurse-staffing agencies.”
In January 2022, about 200 House members urged then White House COVID-19 Response Team Coordinator Jeffrey Zients “to investigate reports that nurse staffing agencies are taking advantage of the COVID-19 pandemic to increase their profits at the expense of patients and the hospitals that treat them,” an AHA new release noted.
In an AHA House Statement titled, “Pandemic Profiteers: Legislation to Stop Corporate Price Gouging,” the AHA wrote “Our concerns range from potential collusion to increased prices way beyond competitive levels and/or egregious price gouging and the impact these behaviors could have on efforts to care for patients and communities.”
Temporary nurses make up a large portion of staff nationwide with 1,760,111 employed nationally as of September, according to Zippia research. With some nurses commandeering $40,000 signing bonuses and pay rates up to $10,000 a week for ICU nurses during the height of the COVID-19 pandemic, the significant impact of these rate hikes cannot be ignored.
“We have received reports that the nurse staffing agencies are vastly inflating price by two, three, or more times pre-pandemic rates, and then taking 40% or more of the amount being charged to the hospitals for themselves as profits. This situation is urgent and reliance on temporary workers caused normal staffing costs to balloon in all areas of the country,” Representatives Peter Welch, D-VT, and Morgan Griffith, R-VA, wrote in the letter submitted by the AHA to House members.
States Take a Stand
But nothing was done at the federal level to cap rates for travel nurses, so hospital organizations in 14 states lobbied legislators to cap rates at the local level. However, this has proven to be problematic.
At this time, at least 14 states have proposed legislation that impose limits on what temp nursing services can charge and what stipulations they must follow during a crisis. Navigating this patchwork of state laws could be challenging for both hospitals and temporary nurses.
Some states are taking sterner measures, KFF Health News reported:
Missouri regulators proposed legislation that would allow felony charges to be brought against healthcare staffing agencies that raise prices during emergencies.
Texas lawmakers proposed legislation that would administer civil penalties against agency price-gouging—laws which the state does not have on the books at all—and also would allow fees up to $10,000 to be assessed per violation of the proposed law.
New York proposed amendments to legislation that would cap the amount temporary staffing agencies could charge.
Nurses, Staffing Agencies Tell Their Side
The implementation of new laws to protect hospitals from alleged temp agency price gouging presents new challenges. One issue is state-to-state competition.
“It might become difficult to hire travel nurses, and some states could face a lower-quality hiring pool during a national crises if the neighboring state doesn’t have strict measures,” Hannah Neprash, PhD, Assistant Professor, Division of Health Policy and Management at the University of Minnesota, told KFF Health News.
And financial handcuffs may not sit well with staffing agencies that feel misunderstood by hospital organizations pushing for regulation. According to KFF Health News, “Typically about 75% of the price charged by a staffing agency to a healthcare facility goes to costs such as salary, payroll taxes, workers’ compensation programs, unemployment insurance, recruiting, training, certification, and credential verification, said Toby Malara, a Vice President at the American Staffing Association trade group.”
Malara added, “hospital executives have, ‘without understanding how a staffing firm works,’ wrongly assumed price gouging has been occurring. In fact, he said many of his trade group’s members reported decreased profits during the pandemic because of the high compensation nurses were able to command,” KFF Health News reported.
Not surprisingly, many nurses have also come out against government regulation of their wages.
“Imagine the government attempting to dictate how much a lawyer, electrician, or plumber would make in Missouri. This would never be allowed, yet this is exactly what’s happening right now to nurses,” Theresa Newbanks, FNP, a nurse practitioner who is affiliated with several hospitals in multiple states.
Creative Responses Required
Increases in both rates and legislation continue to spur creativity among hospitals needing to fill shifts, support staff, and prevent worker burnout.
The American Hospital Association December 2022 Task Force noted this in their “Creative Staffing Models” paper. The AHA cited telehealth visits, technical support, and working with non-traditional partners as beneficial ideas. These were also noted as meaningful ways to recruit and retain staff.
Other hospital systems have even created their own staffing agencies. Allegheny Health Network (AHN) developed a variety of systems where nurses can work a single weeklong assignment, multiple-week assignments, or transfer to other facilities, Kaiser Health News reported. While these staffing scenarios make up a small percentage of the hospital staff, it’s a worthwhile addition to increase options for nurses.
Staff turnover for RNs increased from 8.4% to 27.1% last year, as reported by the 2022 NSI National Healthcare Retention and RN Staffing Report. Finding solutions to staffing shortages—and consequently increased temporary nursing cost—is crucial because burnout is still a problem, just as it is in clinical laboratories and pathology groups.
Dogs’ acute sense of smell can even surpass effectiveness of some clinical laboratory testing in detecting certain diseases in humans
When it comes to COVID-19 testing, a recent Italian study demonstrates that trained dogs can detect SARS-CoV-2 with accuracy comparable to rapid molecular tests used in clinical laboratories. The researchers wanted to determine if dogs could be more effective at screening people for COVID-19 at airports, schools, and other high-traffic environments as a way to detect the coronavirus and reduce the spread of this infectious disease.
Scientists at the State University of Milan in Italy conducted a study that shows dogs can be trained to accurately identify the presence of the COVID-19 infection from both biological samples and by simply smelling an individual.
For their validation study, the Italian team trained three dogs named Nala, Otto, and Helix, “to detect the presence of SARS-CoV-2 in sweat samples from infected people. At the end of the training, the dogs achieved an average sensitivity of 93% and a specificity of 99%, showing a level of accuracy highly consistent with that of the RT-PCR [reverse transcription polymerase chain reaction] used in molecular tests and a moderate to strong reproducibility over time,” Nature reported.
RT-PCR tests are the current gold-standard for SARS-CoV-2 detection. This is yet another example of scientists training dogs to smell a disease with “acceptable” accuracy. This time for COVID-19.
“We only recruited dogs that showed themselves predisposed and positively motivated to carry out this type of activity. One of the fundamental aspects was not to cause stress or anxiety in the subjects used,” Federica Pirrone, PhD (above), Associate Professor, Department of Veterinary Medicine and Animal Sciences, University of Milan, and one of the authors of the study told Lifegate. “Training always takes place using positive reinforcement of a food nature: whether it’s a particularly appetizing morsel, a biscuit, or something that associates the dog’s search with a rewarding prize.” In some instances, dogs have been shown to be as good or more effective at detecting certain diseases than clinical laboratory testing. (Photo copyright: Facebook.)
Dogs More Accurate than Rapid Antigen Testing
Nala and four other dogs (Nim, Hope, Iris and Chaos) were later trained by canine technicians from Medical Detection Dogs Italy (MDDI) to identify the existence of the SARS-CoV-2 virus by directly smelling people waiting in line in pharmacies to get a nasal swab to test for the coronavirus.
Working with their handlers, the five dogs accurately signaled the presence or absence of the virus with 89% sensitivity and 95% specificity. That rate is “well above the minimum required by the WHO [World Health Organization] for rapid swabs for SARS-CoV-2,” according to Nature.
“The results of studies published so far on the accuracy of canine smell in detecting the presence of SARS-CoV-2 in biological samples (e.g., saliva, sweat, urine, trachea-bronchial secretions) from infected people suggest that sniffer dogs might reach percentages of sensitivity and specificity comparable to, or perhaps even higher, than those of RT-PCR,” the scientists wrote in Scientific Reports.
“However, although most of these studies are of good quality, none of them provided scientific validation of canine scent detection, despite this being an important requirement in the chemical analysis practice. Therefore, further applied research in this field is absolutely justified to provide definitive validation of this biodetection method,” the researchers concluded.
Other Studies into Using Dogs for Detecting Disease
Scientists from the Division of Biological and Health Sciences, Department of Agriculture and Livestock at the University of Sonora; and the Canine Training Center Obi-K19, both in Hermosillo, Mexico, conducted the study “as part of a Frontiers of Science Project of the National Council of Science and Technology (CONACYT), in which in addition to analyzing sweat compounds, trained dogs are put to sniff the samples and make detections in people who show symptoms or could be positive for coronavirus,” Mexico Daily Post reported.
The researchers trained four dogs with sweat samples and three dogs with saliva samples of COVID-19 positive patients. The samples were obtained from a health center located in Hermosillo, Sonora, in Mexico. The dogs were restricted to spend five minutes per patient and the researchers calculated the performance of the dogs by measuring sensitivity, specificity, and their 95% confidence intervals (CI).
The researchers concluded that all four of the dogs could detect COVID-19 from either sweat or saliva samples “with sensitivity and specificity rates significantly different from random [sampling] in the field.” According to the Frontiers in Medicine study, the researchers found their results promising because, they said, it is reasonable to expect the detection rate would improve with longer exposure to the samples.
The objective of the Mexican researchers is for the dogs to ultimately reach the sensitivity range requested by WHO for the performance of an antigen test, which is at least 80% sensitivity and 97% specificity. If that goal is achieved, dogs could become important partners in the control of the COVID-19 pandemic, the scientists wrote.
Data obtained so far from these studies indicate that biosensing dogs may represent an effective method of screening for COVID-19 as well as other diseases. More studies and clinical trials are needed before the widespread use of dogs might become feasible. Nevertheless, scientists all over the world are finding that Man’s best friend can be a powerful ally in the fight against the spread of deadly diseases.
In the meantime, the gold standard in COVID-19 testing will continue to be the FDA-cleared assays used by clinical laboratories throughout the United States.
