Two weeks after Change Healthcare went dark on February 21, the federal government has spoken. Yesterday, March 5, 2024, the Department of Health and Human Services issued a statement on the cyberattack that reads, for the first time, like an operational response rather than a monitoring update. It follows UnitedHealth Group's confirmation on February 29 that the ransomware group known as ALPHV or BlackCat was behind the attack, and the launch on March 1 of a temporary funding program by Optum for affected providers.
We have spent the morning reading the statement against what our billing team can actually do today. Some of it helps this week. Some of it is a request to payers who may or may not comply. And one part, the possibility of Medicare advance payments, is a promise of details to come. Here is the breakdown, measure by measure, followed by the calls we think every practice should make before Friday.
Key takeaways
- HHS's March 5 statement directs Medicare Administrative Contractors to accept paper claims and to expedite EDI enrollment for providers moving to a new clearinghouse. Those two items are the concrete help.
- Everything aimed at Medicare Advantage, Part D and Medicaid managed care plans is encouragement, not a requirement. Get each plan's outage policy in writing.
- CMS says it will consider accelerated payments for Part A providers and advance payments for Part B suppliers. No terms yet; do not plan payroll around it.
- The Optum Temporary Funding Assistance Program is interest-free cash for practices whose payments ran through Change. Register if you qualify, after reading the terms.
- Nothing in the statement restores the connection. The daily held-claims count and manual posting continue.
What HHS said
The statement announces, in summary, that CMS will:
- Direct Medicare Administrative Contractors to expedite requests from providers who need to enroll with a new clearinghouse, and to provide guidance on the new EDI enrollment process.
- Have MACs accept paper claims from providers who need to submit them because of the outage, and direct them to publish instructions.
- Encourage Medicare Advantage organizations and Part D sponsors to remove or relax prior authorization and other utilization management requirements, to extend timely filing deadlines, and to offer advance funding to the providers most affected, for the duration of the disruption.
- Encourage Medicaid and CHIP managed care plans to do the same, and work with states on Medicaid fee-for-service flexibilities.
- Consider accelerated payments for Part A providers and advance payments for Part B suppliers, in the way it has done during natural disasters, with details to follow.
HHS also said it is in contact with UnitedHealth Group about the incident and about the pace of restoration, and reminded payers that they, not the clearinghouse, are responsible for paying claims on time. That last sentence is worth quoting back to any payer representative who tells you the delay is "a Change problem".
What each item means at the desk
| Measure | Who acts | Usable this week? | Our read |
|---|---|---|---|
| Expedited EDI enrollment for a new clearinghouse | Your MAC | Yes, once the MAC posts its process | The most concrete help. Medicare enrollment was the slowest step in switching; if MACs turn it around in days, a secondary route becomes realistic |
| Paper claims to Medicare | Your MAC | Yes, with the MAC's instructions | Useful for aged and high-dollar claims. Paper claims take longer to pay, so do not move volume to paper if a portal route exists |
| Relaxed prior authorization and extended timely filing | Medicare Advantage and Part D plans, voluntarily | Depends on the plan | "Encourage" is not "require". Call your top MA plans and ask for their outage policy in writing |
| Advance funding from MA plans | Plans, voluntarily | Depends on the plan | A few large carriers have announced something; most have not. Ask |
| Medicaid managed care flexibilities | Plans and states | Depends on the state | Watch your state Medicaid agency's provider bulletins |
| Accelerated and advance payments | CMS, pending details | Not yet | This is what hospital and physician groups asked for. Expect terms in days, not weeks, and expect repayment through offset against future claims |
Paper claims: when they make sense and when they do not
Medicare has required electronic claims from almost all providers since the Administrative Simplification Compliance Act took effect in 2003, with narrow exceptions, so most billers under 40 have never mailed a CMS-1500 to a MAC. The outage waiver changes that for a while. Before you order forms, think about what paper is for. A paper claim to Medicare takes at least 29 days to pay by statute, against about 14 for a clean electronic claim, and every field has to be typed or printed into the red form correctly or it is returned. That makes paper a route for claims that cannot wait for the connection: high-dollar procedures, claims approaching timely filing, and anything for a patient whose coverage is about to end.
Two practical points. First, use your MAC's published instructions and mailing address for outage-related paper claims, not an address from an old manual. Second, the free claim entry tools most MACs offer through their portals are usually faster than paper and do not require a waiver. If your problem is a few hundred claims, portal entry at three minutes each is a long week for one person, but it pays sooner than paper.
The UnitedHealth funding program
Separately from HHS, Optum launched what it calls a Temporary Funding Assistance Program on March 1. It works through Optum Pay: the practice registers, and Optum advances funds each week equal to the difference between the practice's historical payment level and what it is receiving now, with no fees or interest, to be repaid once claims flow resumes. Eligibility is centered on providers whose payments from payers were processed through Change Healthcare.
The American Hospital Association wrote to UnitedHealth Group on March 4 describing the program as inadequate, and physician groups have made similar points. Our own view is narrower. The program is worth registering for if your practice qualifies, because it is cash with no interest. But read the terms before you sign: the eligibility definition is specific, the repayment trigger is when claims flow resumes rather than when your cash actually recovers, and the agreement is with a UnitedHealth Group company. For a practice that also contracts with UnitedHealthcare as a payer, have someone read the document who understands both relationships.
Sizing your own exposure before you call anyone
Every conversation this week, with a payer, a bank or a funding program, goes better with three numbers in hand. Take a three-provider practice as an example.
| Number | How to get it | Example |
|---|---|---|
| Expected weekly collections before the outage | Average payer deposits per week, December and January | $62,000 |
| Actual weekly collections now | Bank deposits from payers, last two weeks | $19,000 |
| Held claims by payer | Completed claims without a payer acknowledgement, by payer, with charges | $205,000 in charges, 55 percent Medicare and MA, 30 percent commercial, 15 percent Medicaid managed care |
With those numbers the practice knows its weekly gap is about $43,000, that Medicare paper and expedited EDI enrollment address more than half of what is held, and that the payer calls should start with the two MA plans that make up most of the rest. Without them, the call to the payer is a complaint. With them, it is a request for a specific amount of relief on a specific set of claims.
What is still not fixed
Nothing in the HHS statement restores the connection. Change Healthcare has published no firm date for claims or eligibility services, and the March 1 program announcement did not include one either. Pharmacy transactions have been the first priority for the company, and many pharmacies have found workarounds through other switches. Claims and eligibility for medical practices remain offline through most of the affected connections.
Timely filing remains the risk that grows every day. The HHS request to extend deadlines is directed at Medicare Advantage, Part D and Medicaid plans. It says nothing about commercial group plans, and the largest commercial carriers have each made their own announcements, some generous and some silent. Do not assume any payer has extended anything until you have it in writing from that payer.
Questions we hear
Will Medicare pay interest on delayed claims?
Medicare pays interest on clean claims it fails to pay within the statutory floor, but that clock starts when Medicare receives the claim. Claims stuck at the clearinghouse were never received. Do not expect interest for the outage period.
Should we take the Optum advance or wait for the CMS program?
They are not exclusive as far as we can tell, though the CMS terms are not out yet and may ask about other funding sources. Take what you qualify for now; cash flow problems compound. Speak with your accountant about how advances appear on the books, because both programs are loans in substance.
Is our billing company handling this?
Ask for the daily held-claims count and the payer-by-payer plan. A billing company that cannot produce those two things this week is waiting rather than working. We send both to the practices we bill for each morning, and if you want a second opinion on your own plan, our denial management and billing teams are glad to walk through it.
What to do this week
- Check your MAC's website daily for the paper claim instructions and the expedited EDI enrollment process. Most MACs are expected to post within days.
- If you have not chosen a secondary clearinghouse, choose one now and submit Medicare EDI enrollment as soon as the MAC process is live.
- Build the three-number exposure summary above before making any payer call.
- Call your five largest payers and ask three questions: Are you extending timely filing, and until when? Are you relaxing prior authorization, and for what? Where do we send claims while the outage lasts? Record the answers with the date and the representative's name.
- Register for the Optum funding program if your payments were processed through Change, after reading the terms.
- Keep the daily count of completed claims without payer acceptance, sorted by date of service. Move anything within 30 days of a filing limit to a portal or paper route today.
- Continue posting payments manually from payer portals. The AR report is only as good as the posting behind it.
