Skip to main content
Sister Publication Links
  • ESG: THE NEW IMPERATIVE
Subscribe
  • Sign Up Free
  • Login
  • Subscribe
  • News
    • Current News
    • COVID-19
    • Providers
    • Insurance
    • Government
    • Finance
    • Technology
    • Safety & Quality
    • Transformation
    • People
    • Regional News
    • Digital Edition (Web Version)
    • Patients
    • Operations
    • Care Delivery
    • Payment
    • Midwest
    • Northeast
    • South
    • West
  • Digital Health
  • Insights
    • ACA 10 Years After
    • Best Practices
    • Special Reports
    • Innovations
  • Opinion
    • Bold Moves
    • Breaking Bias
    • Commentaries
    • Letters
    • Vital Signs Blog
    • From the Editor
  • Events & Awards
    • Awards
    • Conferences
    • Galas
    • Virtual Briefings
    • Webinars
    • Nominate/Eligibility
    • 100 Most Influential People
    • 50 Most Influential Clinical Executives
    • Best Places to Work in Healthcare
    • Excellence in Governance
    • Health Care Hall of Fame
    • Healthcare Marketing Impact Awards
    • Top 25 Emerging Leaders
    • Top 25 Innovators
    • Diversity in Healthcare
      • - Luminaries
      • - Top 25 Diversity Leaders
      • - Leaders to Watch
    • Women in Healthcare
      • - Luminaries
      • - Top 25 Women Leaders
      • - Women to Watch
    • Digital Health Transformation Summit
    • Leadership Symposium
    • Social Determinants of Health Symposium
    • Women Leaders in Healthcare Conference
    • Best Places to Work Awards Gala
    • Health Care Hall of Fame Gala
    • Top 25 Diversity Leaders Gala
    • Top 25 Women Leaders Gala
    • - Hospital of the Future
    • - Value Based Care
    • - Supply Chain
    • - Hospital at Home
    • - Workplace of the Future
    • - Digital Health
    • - Future of Staffing
    • - Hospital of the Future (Fall)
  • Multimedia
    • Podcast - Beyond the Byline
    • Sponsored Podcast - Healthcare Insider
    • Video Series - The Check Up
    • Sponsored Video Series - One on One
  • Data Center
    • Data Center Home
    • Hospital Financials
    • Staffing & Compensation
    • Quality & Safety
    • Mergers & Acquisitions
    • Data Archive
    • Resource Guide: By the Numbers
    • Surveys
    • Data Points
  • MORE +
    • Contact Us
    • Advertise
    • Media Kit
    • Newsletters
    • Jobs
    • People on the Move
    • Reprints & Licensing
MENU
Breadcrumb
  1. Home
  2. Insurance
May 14, 2021 04:49 PM

Premium growth narrows Oscar Health's year-over-year losses 9% in Q1

Nona Tepper
  • Tweet
  • Share
  • Share
  • Email
  • More
    Reprints Print
    Kate Glicksberg
    Oscar Clinic, Brooklyn, NY

    Oscar Health's net loss narrowed 9% year-over-year, with an increase in policy premium revenue squeezing the New York City-based insurtech's losses to $87.3 million during the first quarter of 2021.

    During the first quarter ended March 31, Oscar generated $369.3 million in revenue, up 319% from $88.1 million during the same period last year. Much of the revenue was driven by policy premium growth, which increased 44% year-over-year to $823 million. The company credited the growth to an increase in membership, and a decline in reliance on reinsurance.

    During the call, CEO Mario Schlosser said the company was on a path to achieve profitability by 2023. The pandemic's disruption of care delivery models, combined with a heightened interest in risk-bearing relationships, would be key for helping the company grow going forward, he said.

    "Post-pandemic, you've got the shift to virtual delivery of care, but you've also got the shift towards a more value-based care, more risk-taking," Schlosser said. "Obviously, this is starting in government business, Medicare Advantage, but I think it's making its way more and more into the commercial business as well."

    Membership grew to 542,220, up nearly 29% from 420,552 during the same time in 2020. Medicare Advantage enrollees more than doubled year-over-year to 3,628, and the startup's new Cigna+Oscar partnership also counted nearly 3,600 beneficiaries since the start of the year. The lion's share of the company's membership continues to lie in individual and small group, however, with total enrollees in this sector coming to about 535,000.

    Here are five things to know from the company's first-quarter earning call:

    1. Schlosser credited the ACA's special enrollment period with helping add 50,000 new members during the first quarter, and he anticipates the advance premium tax credits will help grow membership even further going forward. Florida, Texas and California now represent the areas with the largest number of Oscar enrollees. So far, new members are not sicker than previously expected, and the company has not yet experienced adverse selection, he said. These members are also generally coming to Oscar directly, rather than through a broker, and are choosing the startup even though it does not often offer the cheapest plan in a market.

    "In terms of the shift towards higher premium plans, that genuinely makes us think that it's important to have a model where you deliver a great member experience, where people love model more than price," Schlosser said.

    2. After the company's initial public offering in March, and increasing profitability, Oscar cut its reliance on reinsurance partners for the year, Chief Financial Officer Scott Blackley said. Reinsurers essentially take a portion of a member's premium for assuming some of their risk. In 2020, Oscar passed on 77% of its premiums to reinsurers; during the first quarter, the company ceded 44% of policy premiums.

    "We're not saying that we won't go back and use quota share, but I think in the near-term we're comfortable having a lower percentage," Blackley said. "I'd expect that we would dynamically manage that going forward."

    3. Oscar plans to start next year with at least 72,000 enrollees on its +Oscar insurance technology services business. In addition to including members from third-party customers, like Health First Health Plans and Cigna+Oscar, the company will also count its own members as customers on this platform, which represents a strategic departure from the partnership strategy outlined in its S-1. The company will count 37,000 new Medicare Advantage members through its partnership with Health First, and 20,000 individual market lives on this platform.

    Schlosser added that the company has built provider-sponsored health plans with the Cleveland Clinic, ACHN in South Florida and Montefiore.

    "The next phase of growth, for the +Oscar business, will come from arrangements with providers looking to be at-risk either through provider-sponsored health plans, or from dedicated payers, particularly in Medicare Advantage, individual and small employer," Schlosser said.

    4. Oscar has now scaled its virtual primary care product across 82 counties. When its members use the Oscar Medical Group providers on the platform, Schlosser said they are 10% more likely to retain Oscar as their insurer, compared with those who did not use the digital program. The company incentivizes members to sign up for the virtual care program by offering them "dynamic discounts" on primary care services, and often free recommended secondary services, like lab tests.

    5. The company's medical loss ratio, or MLR, which measures how much of every dollar an insurer spends on its members' care, came in at 74.4%. Schlosser said he expected to end the year with an MLR closer to 80%, as non-COVID-19 utilization picks up during the second half of 2021. Low utilization was offset by high COVID-19 costs that peaked in January, Schlosser said.

    Letter
    to the
    Editor

    Send us a letter

    Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.

    Recommended for You
    medicare-advantage-CMS-audits
    More MA insurer audits mean more scrutiny on providers
    medicare advantage directories
    Provider directories are a mess. CMS' plan to fix them has few fans
    Most Popular
    1
    More healthcare organizations at risk of credit default, Moody's says
    2
    Centene fills out senior executive team with new president, COO
    3
    SCAN, CareOregon plan to merge into the HealthRight Group
    4
    Blue Cross Blue Shield of Michigan unveils big push that lets physicians take on risk, reap rewards
    5
    Bright Health weighs reverse stock split as delisting looms
    Sponsored Content
    Daily Finance Newsletter: Sign up to receive daily news and data that has a direct impact on the business and financing of healthcare.
    Get Newsletters

    Sign up for enewsletters and alerts to receive breaking news and in-depth coverage of healthcare events and trends, as they happen, right to your inbox.

    Subscribe Today
    MH Magazine Cover

    MH magazine offers content that sheds light on healthcare leaders’ complex choices and touch points—from strategy, governance, leadership development and finance to operations, clinical care, and marketing.

    Subscribe
    Connect with Us
    • LinkedIn
    • Twitter
    • Facebook
    • RSS

    Our Mission

    Modern Healthcare empowers industry leaders to succeed by providing unbiased reporting of the news, insights, analysis and data.

    Contact Us

    (877) 812-1581

    Email us

     

    Resources
    • Contact Us
    • Advertise with Us
    • Ad Choices Ad Choices
    • Sitemap
    Editorial Dept
    • Submission Guidelines
    • Code of Ethics
    • Awards
    • About Us
    Legal
    • Terms and Conditions
    • Privacy Policy
    • Privacy Request
    Modern Healthcare
    Copyright © 1996-2023. Crain Communications, Inc. All Rights Reserved.
    • News
      • Current News
      • COVID-19
      • Providers
      • Insurance
      • Government
      • Finance
      • Technology
      • Safety & Quality
      • Transformation
        • Patients
        • Operations
        • Care Delivery
        • Payment
      • People
      • Regional News
        • Midwest
        • Northeast
        • South
        • West
      • Digital Edition (Web Version)
    • Digital Health
    • Insights
      • ACA 10 Years After
      • Best Practices
      • Special Reports
      • Innovations
    • Opinion
      • Bold Moves
      • Breaking Bias
      • Commentaries
      • Letters
      • Vital Signs Blog
      • From the Editor
    • Events & Awards
      • Awards
        • Nominate/Eligibility
        • 100 Most Influential People
        • 50 Most Influential Clinical Executives
        • Best Places to Work in Healthcare
        • Excellence in Governance
        • Health Care Hall of Fame
        • Healthcare Marketing Impact Awards
        • Top 25 Emerging Leaders
        • Top 25 Innovators
        • Diversity in Healthcare
          • - Luminaries
          • - Top 25 Diversity Leaders
          • - Leaders to Watch
        • Women in Healthcare
          • - Luminaries
          • - Top 25 Women Leaders
          • - Women to Watch
      • Conferences
        • Digital Health Transformation Summit
        • Leadership Symposium
        • Social Determinants of Health Symposium
        • Women Leaders in Healthcare Conference
      • Galas
        • Best Places to Work Awards Gala
        • Health Care Hall of Fame Gala
        • Top 25 Diversity Leaders Gala
        • Top 25 Women Leaders Gala
      • Virtual Briefings
        • - Hospital of the Future
        • - Value Based Care
        • - Supply Chain
        • - Hospital at Home
        • - Workplace of the Future
        • - Digital Health
        • - Future of Staffing
        • - Hospital of the Future (Fall)
      • Webinars
    • Multimedia
      • Podcast - Beyond the Byline
      • Sponsored Podcast - Healthcare Insider
      • Video Series - The Check Up
      • Sponsored Video Series - One on One
    • Data Center
      • Data Center Home
      • Hospital Financials
      • Staffing & Compensation
      • Quality & Safety
      • Mergers & Acquisitions
      • Data Archive
      • Resource Guide: By the Numbers
      • Surveys
      • Data Points
    • MORE +
      • Contact Us
      • Advertise
      • Media Kit
      • Newsletters
      • Jobs
      • People on the Move
      • Reprints & Licensing