Google Capital has invested $32.5 million in Oscar, the startup health insurance company's CEO Mario Schlosser tells the Wall Street Journal. Now, Oscar is valued at $1.75 billion, up from $1.5 billion as of April.
Thanks to its new funding from the Internet company's growth-equity fund, Oscar continues to run its insurance business more like an Internet service. For instance, a user-friendly website allows subscribers to track and manage medical bills, and the insurer collects data from customers' office visits with doctors to analyze how much they cost.
Schlosser tells the WSJ that part of his goal is to adopt healthcare technologies developed by other companies. Google's life sciences division develops a contact lens with Novartis AG, which could work with Oscar to distribute these types of products to new patients.
The head of Google Capital's David Lawee tells the WSJ that Oscar distinguished itself from other healthcare startups he considered because of its potential to lower hospital bills and other costs for consumers.
But the company is not without its growing pains. Last year, the insurer lost $37 million. And while it took in $56.9 million in premiums in New York, it dished out $66.3 million on doctors, hospitals and drugs, plus an additional $24.3 million on administrative expenses, FierceHealthPayer previously reported.
The losses stem from Oscar's investments in building new technologies. "The core business of delivering health-care services was operating at a profit," Schlosser tells the WSJ.
More than 40,000 consumers have purchased plans in Oscar's first two markets, New York and New Jersey. And the company recently announced plans to enter California's exchange, a move expected to test whether the insurer can actually deliver more than impressive marketing techniques.
- here's the WSJ article