Former Chairman & Chief Executive Officer, AETNA INC
Will Aetna, Humana Union Impact Health Costs?
Jul 7 -- Aetna Chairman and CEO Mark Bertolini and Humana President and CEO Bruce Broussard discuss the investor reaction Aetna’s and Humana’s $35 Billion deal with Betty Liu on “Bloomberg Markets.” (Source: Bloomberg)
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About Mark Bertolini
Mark Bertolini, CEO of Oscar Health, has been discussing the company's technology-driven approach to health insurance and advocating for changes to the U.S. healthcare system. In a May 2026 interview, he described Oscar as a "tech-first insurance company" that is "digitally native" with a single platform and data set, and stated that the company uses over 40 large language models and three agentic AI bots. He said Oscar operates solely in the ACA marketplace, covering about 3 million lives across 21 states, and noted that the company has reduced operating costs by a billion dollars while growing from 750,000 to 3.5 million members with the same number of employees. Bertolini argued that Americans are "fed up" with current coverage and that the shift from defined benefit to defined contribution models, such as ICHRA, will happen faster than the transition from pensions to 401(k)s. In a February 2026 conversation, Bertolini criticized the current health insurance model, saying it "conflates financing with investment" and that healthcare is the most expensive household line item with no consumer shopping ability. He proposed separating financing from investment through Roth IRA-like HSA accounts, allowing individuals to buy networks and plan designs that fit their circumstances. Bertolini also discussed his personal experience as a caregiver for his son, who was diagnosed with terminal cancer, and said this informed his perspective. He highlighted a new platform called Lucie, which aims to create a shopping experience for healthcare, and noted that six states have passed legislation to support this model.
Transcript (20 segments)
✨ AI-enhanced transcript with speaker attribution
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Betty Liu0:00
The share prices of actually both of your companies declined on this news, so investors didn't seem to be buying this merger. How do you convince them that a merger between Aetna and Humana makes sense for them?
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Mark Bertolini0:15
I don't think it's all investors, Betty. I actually think it's the arbs that got in the deal looking for opportunity, and I'm not quite sure they know how to do this trade because this is a longer-term strategy. This is a very big combination that's going to have a longer-term impact on the quality of healthcare, the cost of healthcare in an evolving consumer marketplace. So I'm not quite sure they know how to play it. It'll settle down and the noise will come out of the system and we'll do just fine.
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Betty Liu0:41
Okay, Bruce, is it going to lower healthcare costs for consumers?
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Bruce Broussard0:43
Very much so. I think as you see the transition from a more employer-based to a consumer-based model and a value-based reimbursement model from a fee-for-service model, these combined organizations will have the capability to meet both of those trends, both in the way of our clinical capabilities on Humana's side and the deep, deep employer relationships that Aetna has on their side.
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Betty Liu1:10
Mark, is there going to have to be though some divestiture of your business or Humana's business in order to pass regulators?
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Mark Bertolini1:21
Yes, we did actually a very detailed review, Betty, of the businesses at a local market level. So this is not statewide, this is not citywide, this is down to the zip code and rating area kind of analysis. And we will have to do some divestitures. We included those divestitures in the value of the deal, in the costs of the deal, and we still believe they give very healthy returns over time.
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Betty Liu1:47
How much? I mean, what kind of chunk of revenue are we talking about that you might have to give up?
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Mark Bertolini1:50
Yeah, we're really not broadcasting that number. That's subject to a conversation with the Department of Justice and we don't want to get ahead of ourselves.
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Betty Liu2:00
Okay, because there are some estimates already out there, right? Stern Agee came out and said that you might have to give up about 13% of your revenue in order to get this past regulators. I mean, is that way off the mark?
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Mark Bertolini2:12
I would just say that we're not going to talk about that at this time. And everybody's doing an analysis at a far, far less detailed level than we have, and I think that's where the rubber is really going to hit the road.
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Betty Liu2:28
In terms of the value for investors, I understand that we can't say a blanket all shareholders are not happy or are not satisfied perhaps with the deal if you look at the share price. But Bruce, you have to look at where the offer is around $223 for the company, the share price though is well below that price, about $30 below that. What do you think that's telling you?
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Bruce Broussard2:49
Well, I think it's just telling you where Mark was just talking about, and that's the arbs. I think the arbs are very confused. They've been hurt over the last few deals with a long Justice cycle and I just see that in the stock. I will tell you the investors that we've talked to, they are very, very excited about the future of the combined companies and will be holders post-deal. So I don't think it's the longer-term investors. I really think there's some confusion out there on the arb side of how to play this particular transaction.
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Betty Liu3:26
Considering the FTC review, well, is that partly on you in terms of the messaging to the investors?
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Mark Bertolini3:36
Well, I think the messaging is going to have to... not all investors are the same, Betty. So I think we're going to have to let the kind of shareholders who value this deal find their way through it. It could be a huge buying opportunity for them for all intents and purposes. And so I think we just need to let it clear through. We've got a long time between now and when the transaction closes. That's the point at which all of this will be of true value. And so we're going to let the market sort itself out.
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Betty Liu4:02
And Mark, why are these deals happening right now? I mean, it seems like we've seen lots of drug deals, but now we're seeing some health insurance deals. You've got Anthem and Cigna that are at play. I mean, why now?
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Mark Bertolini4:16
Well, I think the big story in all of this is that the business model has to change. We now have doctors on a cash basis, hospitals on a revenue basis, and insurers on a margin basis. It's a wonder the system works at all with three different economic models. To get everybody on the same page, we have to have a fundamentally different level of partnership. It can no longer be smash-mouth at the local market. It actually has to be a partnership between payers and providers on making sure that we're getting the right outcome, which is a healthy, economically productive, and happy member. And so if we look at that as the outcome and we reward the health system for doing that, we're going to start to see trend benders actually make the market more affordable for consumers.
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Betty Liu5:00
Bruce, do you think does any of this though, the timing at least, have something to do with what we heard from the Supreme Court and the affirmation of the Affordable Care Act?
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Bruce Broussard5:08
No, I truly believe this is a long-term trend. I think the exchanges have brought some motivation to it, but I will tell you the ACA and all the items related to that stimulated these kind of discussions but wasn't the reason. Where Mark is going, this transition from a very deep consumer-centric model and a model with value-based reimbursement is really driving the industry from a sick-care model to a health model. And there's technology that needs to be invested in, there's partnerships that have to be created, and size and scale from the ability to ensure it's affordable offers all of that.
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Betty Liu5:50
And Mark, before we go, speaking about the timing, did the fact that there are other mergers out there or other companies in play, and again I point to a Cigna or an Anthem and their pairing, did that have anything to do with you wanting to make sure that you and Bruce get together in a room and iron this deal out?
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Mark Bertolini6:08
No, I think you know, it's very interesting. We've been looking at this kind of combination for five years as a company. I know Bruce and his team have been thinking through over the last few years about how they see the future. And what we knew with all the noise going around was that we had to lock and load on what we thought was best for our customers, best for our shareholders, and best for the people that we serve in the employer community and the provider community. And this was the deal. And so we said, you know, let all the noise rage, let all the rumors amuse people in the marketplace and keep the news cycle going. We're going to get this deal done and move ahead.