Decision on Humana’s Mass. tax break delayed

Bill Sikes

Health insurance giant Humana is going to have to wait for that state tax incentive.

The Louisville, Ky.-based company unveiled plans last month to open a digital health and analytics center in Fort Point, and employ as many as 250 people within the next five years. At the time, state officials expected that Humana would seek and receive a tax break at the September meeting of the state’s Economic Assistance Coordinating Council. The council usually approves what the state administration sends its way, but not this time.

The Baker administration had recommended a tax incentive package worth $225,000. But the council, in a narrow vote, on Wednesday rejected that initial request after noticing that Humana failed to answer a question about past labor disputes or settlements in its application. The council may take the issue up again at its next meeting in December, although it did at least certify the company’s expansion project as eligible for a tax break. (The state incentive, by the way, is pocket change for a company that earned $4 billion in pretax income last year.)

Humana spokesman Mark Mathis said the main reason the company picked Boston for its new center is the area’s deep talent pool in digital technology and data analytics, as well as the potential to forge new business partnerships in the region. Humana Studio H, as the company calls it, will open in mid-2019 in 40,000 square feet at 281 Summer St. That’s close to General Electric’s headquarters and Amazon’s new Boston hub. Documents filed with the state show that Humana plans to invest $10 million in its Boston project.

The insurer already employs about 40 people in the Boston area, and some of them will work in the new office. But the vast majority of the 250 positions planned for the center will be new for the state.

Humana isn’t the only out-of-town health insurer expanding locally. Aetna plans to add up to 250 employees by 2020 at its existing consumer health and services offices in Wellesley. Both expansions probably wouldn’t be happening at the same time if Hartford-based Aetna’s initial plan to acquire Humana had succeeded. The insurers called off their marriage in February 2017 after running into resistance over antitrust issues; a federal judge had ruled against the merger the previous month.

Now, Aetna is the one being acquired — by Woonsocket, R.I.-based CVS Health. Despite the pending deal, however, Aetna’s Wellesley expansion plans are going forward. But it appears likely that Aetna execs will want their own state tax incentive if their merger partner-turned-rival is in line to get one.