Oscar Insurance Corp., the health insurer branded as a tech firm that aimed to turn the industry on its head, will exit ACA markets in Dallas and New Jersey, according to Bloomberg.
We wanted a health insurance company that worked better. So we built one https://t.co/VNHBdkhptF— Oscar (@OscarHealth) November 19, 2015
Oscar is the latest insurer to withdraw from some markets, following in the footsteps of Aetna, UnitedHealth and Scott & White, which have all announced substantial reductions in their ACA exchange offerings.
“The individual market isn’t working as intended and there are weaknesses in the way its been set up,” CEO Mario Schlosser told Bloomberg.
The user-experience driven, tech-savvy insurer suffered $83 million in losses during the first half of 2016, Bloomberg adds. CEO Mario Schlosser oversaw $92.4 million of losses in New York alone in 2015.
Just last month, Schlosser wrote in a blog post Oscar will slash its provider network almost 50 percent in some areas on top of a 16 percent premium hike in New York, but that the move was not entirely motivated by the company’s bottom line. The company, which raised $400 million earlier this year in an investment round lead by Fidelity, has sufficient venture capital backing to withstand lossess for several years, according to Bloomberg.
The insurer did say, however, it plans to expand its ACA presence in the San Francisco Bay Area. “Some of this is really looking at our opportunities and trying to pursue more aggressively the small-group market,” Oscar’s chief policy and strategy officer Joel Klein told Bloomberg.
Oscar’s decision impacts 33,000 enrollees between the two markets, leaving 7,000 people covered in Dallas and 26,000 people covered in New Jersey, according to the report.
- read the Bloomberg report