Touting some promising results from switching to narrow networks for its insurance plans in New York, the CEO of Oscar is betting that the insurer can survive in the individual marketplaces even as other carriers consider dropping out.
While the startup company started out in the Empire State by offering plans with broad networks, it has since slashed the number of in-network physicians for its New York products and raised premiums after losing $92.4 million in the state in 2015. In a previous blog post, CEO Mario Schlosser defended the move, saying he is confident it fits in with the insurer’s long-term vision.
Now, Schlosser has some early evidence to back that up, according to Vox. Oscar’s 20% market share in New York in 2017 dipped only 1% compared to 2016, and its membership also held steady at about 54,000, with 65% of members re-enrolling.
“This was at the high end of my expectations,” Schlosser told the news outlet, noting that Oscar’s ability to retain customers despite cutting ties with many doctors shows loyalty to its brand.
However, it is not yet clear whether this move will be enough to make Oscar’s plans profitable. In Texas and California, meanwhile, where the insurer also offers individual market plans, it has not made significant changes to provider networks as it has done in New York, the article noted.
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Even so, Schlosser said that in 2018, Oscar plans to stay in the markets where it currently operates, and he remained optimistic that the ACA marketplaces will continue to function despite the looming threat of ACA repeal.
Other insurers, including Aetna, Anthem, Cigna and Molina, are still deciding whether to participate on the exchanges next year, and Humana announced last week it will drop out. Centene CEO Michael Neidorff, though, recently said his company has no plans to exit the marketplaces in 2018.