A cyber incident involving a Surgery Partners surgical hospital in Idaho created an $8 million headwind for the company.
The Brentwood, Tenn.-based ASC chain still reported revenue of $667.6 million on the year. When adjusting for the cost of the cyber event, Surgery Partners increased total revenue by 10 percent for the second quarter.
The incident occurred in June, and the hospital was fully back up and functional by July 1, David Doherty, CFO of Surgery Partners, said during the quarterly earnings call Aug. 1, as transcribed by Seeking Alpha. However, billing and collections were delayed during the cyber event. Surgery Partners expects to be caught up by the end of the year and recover some losses with cyber insurance coverage.
"We expect to get most of that shortfall of cash, which we estimated to be $20 million in Q3 and maybe going a little into Q4. But the reality of it is, the market reacted really quickly, [there were] no reputational issues, and we were able to get fully back functional by July 1," said Eric Evans, CEO of Surgery Partners, during the call. "The team put in an incredible amount of work, both locally and corporate."
He said Surgery Partners learned from the cyber event and is more prepared for the future.
"We think it was well handled, but you know this is the world we live in, and we have to make sure we're increasingly prepared and we fell like we are, and just really proud of the team's efforts to make sure this is a one-time kind of blip and moving forward, we feel that market is actually going to continue its usual strong performance," said Mr. Evans.