Mark Bertolini, who took over as CEO of Oscar Health a year ago, has steered the company toward profitability and is now focusing on expanding into the employer market as part of its next growth phase. Bertolini emphasized targeting the 71 million individuals in small and mid-sized group markets, where employees are often over-insured to maintain level premiums. He sees this as a significant opportunity to create a new market by tailoring plans to meet the specific needs of employees.
This strategy is not entirely new. When the Affordable Care Act (ACA) exchanges were introduced a decade ago, it was anticipated that employers would shift away from traditional group coverage to Individual Coverage Health Reimbursement Arrangements (ICHRAs), allowing employees to purchase their own ACA plans. However, this shift did not materialize as insurers did not focus on cost control for employers or their workers.
Bertolini plans to address this by implementing flexible plan designs and underwriting that aligns employees with the appropriate coverage. Oscar Health aims to increase its membership from 1.5 million to approximately 4 million by 2027, with a target of achieving 20% annual revenue growth and earnings of $2.25 per share by 2027.
Bertolini, with his extensive experience as the former CEO of Aetna, likens his role at Oscar to disrupting the status quo in the insurance industry. Last year, he renegotiated Oscar’s pharmacy benefit management (PBM) contract with CVS Health’s Caremark division, a move that helped control medical costs. Oscar’s contract with CVS Caremark runs through 2026, and Bertolini is closely monitoring innovative PBM models, such as Blue Shield of California’s, which aims to reduce costs for members through new partnerships and pricing strategies.
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