Providers and pharmacies already reeling from the recent cyberattack on Change Healthcare now may face damage to their credit ratings.

"We are assessing the degree to which companies' cash flows have been disrupted following the cyberattack on Change, the adequacy of existing liquidity sources and the likelihood and sufficiency of other sources, such as shareholder and lender support, and whether and when issuers switched to other service providers," Fitch Ratings, a leading U.S. credit rating agency, announced on Monday.

Smaller health-care organizations are especially vulnerable. "We believe any credit implications are likely to be limited to smaller companies due to their limited financial flexibility to withstand even temporary cash-flow disruptions," Fitch said. "These companies tend to be rated in the 'CCC' or low-to-mid 'B' categories, indicating very low margins of safety. Companies that have borrowed from direct lenders, such as private credit lenders, may be able to negotiate temporary relief in coordination with lenders and shareholders."

Complete your profile to continue reading and get FREE access to BenefitsPRO, part of your ALM digital membership.

Your access to unlimited BenefitsPRO content isn’t changing.
Once you are an ALM digital member, you’ll receive:

  • Breaking benefits news and analysis, on-site and via our newsletters and custom alerts
  • Educational webcasts, white papers, and ebooks from industry thought leaders
  • Critical converage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.