Oscar Health is aiming to reach profitability by 2024 and to achieve that goal is focusing on the area where it's seen the most success to date: the individual market, executives said late Tuesday.
Oscar has nixed its Medicare Advantage (MA) plans in New York and Texas for the 2023 plan year but will continue to offer a plan in Broward County, Florida, which is offered in partnership with Holy Cross Health in Fort Lauderdale and Memorial Healthcare System in Hollywood. CEO Mario Schlosser told investors that while Oscar sees a potential future in the MA market, partnerships like these will be key.
"The MA market is a market we want to eventually go back to and do more in, but the way for us to be in this market is through partners," he said.
Oscar said it would enter the MA market in 2018 after receiving an infusion of cash from Alphabet, Google's parent company. The insurtech launched its first MA plans for the 2020 plan year. Membership in these plans has historically been low, sitting at 4,577 members as of the third quarter of this year.
By comparison, Oscar's membership in the individual and small group markets has exploded alongside a broader trend of much higher enrollment in plans on the Affordable Care Act's exchanges. Its membership nearly doubled year over year, increasing 81% from the third quarter of 2021 to top 1 million people. Enrollment in Oscar's co-branded plans with Cigna, which target small businesses, has also increased significantly, growing from just under 8,200 members a year ago to 53,300 in the third quarter.
Schlosser said that the massive growth in its ACA plan membership made it easier for the company to focus on its path to profitability. He said Oscar's brand in the market is strong, making it well positioned and poised to center growth in its strategic vision in the future.
"We are really good at, we believe, ACA plans … and we want to be focused there," he said.
One potential avenue for the future in MA, he said, is the insurer's +Oscar offering, which is the company's bolt-on tech stack. Oscar Health has pressed pause on deals for +Oscar as it works toward a more clear goal for growth.
Schlosser said Oscar needs to find the right way to make the pitch for +Oscar, as well as address challenges with integration with its early adopters. Health First Health Plans, one of the first to sign on with +Oscar, ditched the platform in late August amid hitches with the rollout.
One of the best ways to address the ongoing challenges, he said, is to continue using Oscar's tech in the the "best possible way for ourselves" to build the case to potential outside buyers.
"We gotta solve the question of, 'How do we sell +Oscar in a more effective and efficient way?'" Schlosser said.
In addition, Oscar announced alongside its quarterly earnings that current Chief Financial Officer Scott Blackley will transition to serving as the company's chief transformation officer Dec. 1. Former CFO and current board member Sid Sankaran will step back into the CFO role on an interim basis as the company finds a permanent replacement for Blackley.
In the new position, Blackley will spearhead Oscar's operations, +Oscar business and corporate strategy, the insurtech said.