Former Aetna chief Marc Bertolini appointed CEO of Oscar Health

Oscar Health may not have ruined the health insurance industry as promised, but it has ruined its own C-suite, insurtech announced Tuesday.

Oscar Health CEO and co-founder Mario Schlosser will step down next Monday and make way for former Aetna CEO and chairman Marc Bertolini, the company said in a statement. Schlosser will remain president of technology.

Bertolini was CEO of Aetna from 2010 until 2018, when he left after CVS Health acquired the insurance company. He has also served as Chairman of the Board of Directors since 2011. The industry veteran has been an advisor to Oscar Health since 2021, according to a press release. Prior to joining Aetna, he held leadership positions at Cigna, NYLCare Health Plans and SelectCare. Most recently, Bertolini was co-CEO of investment management firm Bridgewater Associates.

Schlosser and fellow founder Joshua Kushner launched Oscar Health in 2012, pitching it to investors and consumers as a modern, technology-driven health insurance company that will bring innovation to the sector. The arrival of Bertolini, who ran the legacy company that Oscar Health was to replace, marks a significant shift.

“We share a fundamental philosophy that truly innovative technologies that support the Oscars and the industry are a critical component of healthcare change,” Schlosser said during a call with investors on Tuesday.

Bertolini is faced with a company in need of change. Oscar Health has never made a profit. The insurance company posted a net loss of $610 million last year, 6.8% worse than the previous year, and expects to lose between $75 million and $175 million in 2023. Oscar Health executives have assured investors that profitability is on the horizon this year.

Oscar Health has scaled back its business due to financial difficulties. Last year, the company suspended new business for its IT +Oscar business, effectively closed its Medicare Advantage line, and stopped enrolling in health insurance exchange policies in Florida, its largest market for these products.

“We will take a fresh look at our technology platform with an eye to developing our strategy to bring more of our capabilities to market over time,” Bertolini told investors on Tuesday.

Insurtechs like Oscar Health, Bright Health Group, and Clover Health have had a tough 2022 as they continue to struggle to make money in the normally lucrative health insurance sector, which is still dominated by big money-makers like UnitedHealth Group. Elevance Health, Centene and Humana.

Investors reacted positively to Bertolini’s hiring. Shares rose 35% to $4.90 at the market open on Tuesday. Oscar Health shares debuted on the New York Stock Exchange at $39 in 2021.