Americans don’t need another reason to check their 401(k)s. But Mark Cuban has one—and it has less to do with whether the portfolio is making money than with what those investments are actually funding.
Billionaire entrepreneur and Cost Plus Drugs co-founder Mark Cuban wrote in a post on X that Americans who own shares in funds holding major health insurance companies are part of the problem driving up healthcare costs. Cuban pointed to a statistic that makes his argument especially personal—61% of Americans own stocks either directly or indirectly.
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Cuban’s Message to 401(k) Investors
“If you own shares in a fund that owns any of the biggest insurance carriers, you are part of the cost of healthcare problem in this country,” Cuban wrote.
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He argued that those companies have an incentive to protect their stock prices, even when doing so can come at the expense of patients.
“Those companies put the share price over the health of you, your family, co-workers and friends,” Cuban wrote. He also accused them of misleading people in pursuit of higher profits.
His proposed response isn’t particularly complicated. Cuban urged investors to tell the funds they own that they’ll sell if those funds don’t divest from the biggest insurance companies.
“You can make a difference,” Cuban wrote.
The 61% Problem
Cuban’s argument gets more interesting because individual investors don’t necessarily have to buy an insurance stock themselves to have exposure to the industry.
A worker with a 401(k), for example, may own a broad-market index fund without ever selecting a health insurer. That fund can still hold shares of major companies in the industry.
Among the major players are UnitedHealth Group (UNH), Elevance Health (ELV), CVS Health (CVS), Cigna (CI), Humana (HUM), and Centene (CNC). These companies can appear in mutual funds and ETFs that are widely held by investors.
That makes Cuban’s 61% figure central to his argument. If most Americans have some form of stock ownership, even indirectly, he believes shareholders have more influence than they may realize.
Cuban Has Been Fighting the Middlemen
This isn’t a new target for Cuban.
Through Cost Plus Drugs, he has built a business around selling prescription medications using a transparent cost-plus pricing model. The company was created in part to challenge the layers of middlemen that Cuban argues can make medicines more expensive.
His criticism of health insurers fits into that broader view of the healthcare system. Cuban has repeatedly argued that the incentives in healthcare can reward companies for financial performance without necessarily producing better outcomes for patients.
His latest post takes that argument one step further by putting some of the responsibility on investors themselves.
There is a complication, though. Index funds are designed to track markets, not necessarily to exclude companies based on an investor’s views. And many people don’t have much control over the individual holdings inside a workplace retirement plan.
Still, Cuban’s point is straightforward. Owning a piece of a company can mean benefiting financially from the very business practices an investor complains about.
For the 61% he referenced, that raises an uncomfortable question—if the portfolio profits from the system, is it really possible to complain about the system while cheering when the account balance goes up?
On the date of publication, Caleb Naysmith did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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