Oscar Health continues to deliver on our commitments | hioscar Blog | Oscar
Oscar Health continues to deliver on our commitments
Oscar held its 2024 Investor Day to discuss updates across our business and map out our company strategy.
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On June 7, 2024, Oscar held its 2024 Investor Day, convening shareholders, analysts, and investors, to discuss updates across our business, review our financial performance, and map out our longer term company strategy.
Mark Bertolini, Oscar’s Chief Executive Officer, and other members of the management team presented live from the New York Stock Exchange to provide perspectives on:
Oscar’s three-year strategy and why Oscar is well-positioned to capture emerging opportunities driving innovation in healthcare, Oscar’s longer-term financial targets and path towards achieving them, Growth of the individual market, why Oscar is well-positioned to win; and How our tech differentiation is an ever-increasing driver of our results
Oscar Health is winning and we continue to deliver on our commitments
Over the last decade, Oscar has invested its energy into building a scalable, sustainable, and profitable business. Now, in 2024, as a result of our cumulative efforts, we are entering the next phase of our growth. “We are demonstrating our ability to deliver on our commitments and I am proud of what we have been able to accomplish,” said Bertolini.
Oscar has achieved significant milestones including:
Reaching Full-Year Insurance Company Profitability in 2023 for the first time in our history,
Being on track to deliver Total Company profitability this year, having generated significant Total Company Adjusted EBITDA improvement in 1Q2024,
Delivering 46% Revenue Growth YoY in 1Q2024,
Serving >500k external client lives on the +Oscar platform.
Our teams continue to drive exceptional engagement, superior health experiences, and tech-enabled growth and affordability for our ~1.5 million members. Our laser-focus on delivering unparalleled experiences continues to drive an industry-leading Net Promoter Score (NPS) of 66 as of 1Q2024, solid member retention of 82% for OE24, and consistent MLR improvement and SG&A efficiencies.
Capturing Emerging Healthcare Opportunities
Oscar’s innovative tech-enabled model – made up of Oscar Insurance, +Oscar, and ICHRA – is uniquely positioned to address emerging market trends, while meeting the rising expectations of individuals and families.
The key trends shaping the future of healthcare:
1) Consumer Expectations for Affordable Healthcare: Healthcare represents a growing share of consumer and employer wallets
2) Stable Individual Market Risk Pool: Growth of the ACA market has created a larger risk pool than any employer, state, or subdivision of the economy, which has resulted in a more stable cost trend than the rest of the industry
3) New Disruptive Technologies: The industry is identifying opportunities to lower medical costs and improve experiences using artificial intelligence (AI) where appropriate
Oscar is positioned to deliver on these evolving expectations due to our deep ACA expertise with a decade of proven products, brand recognition, and experience navigating market dynamics. Oscar was an early player in the ACA, which now has more than 21 million people enrolled for 2024 – an affirmation that ACA plans better meet individual needs compared to conventional employer-based models. We see a significant opportunity to expand the individual market to work for more consumers through Individual Coverage Health Reimbursement Arrangements (ICHRA).
Oscar’s Strategic Path
Oscar’s strategy brings our model to more individuals across the country and is guided by four strategic objectives:
Deliver market-leading, scalable operations,
Build on our superior member experience,
Harness our technology to power others,
Innovate market offerings to expand the ACA via ICHRAs.
Our strategic path creates a marketplace where healthcare decisions are made by individuals, not for individuals – with the freedom to choose from an array of solutions that grow with them at every stage of life. As we create more consumer value, which in turn drives long-term shareholder value, we project that we will grow at 20% revenue CAGR and achieve ~5% operating margin profitability.
Making the Individual Market the Market for Everyone
Oscar continues to play a forceful role in expanding the individual market. The ACA has reached a size that makes it a permanent, attractive option supporting our country’s most diverse populations – filling a critical gap in the market.
“The ACA’s continued growth affirms that individual plans meet consumer needs of affordability, access, and quality and are a viable alternative to conventional employer-based models,” said Bertolini. He continued, “We see a long-term opportunity to continue growing the individual market by serving a broader set of consumers, including employers and employees through ICHRAs.”
ICHRA has the power to disintermediate traditional employer group coverage, unlock growth beyond the traditional ACA, and transform health benefit experiences for both employers and employees. Oscar is positioned to be the leading ICHRA carrier and drive the next frontier of individual market growth.
Oscar plans to activate strategic partnerships with ICHRA platforms in different segments: 1) small group (<50 employees), 2) middle market, and 3) large employers in industries with high utilization and benefits costs. In 2025, we will launch disruptive new ICHRA products through Oscar Insurance. Lastly, starting in 2025 through 2027, we plan to scale our ICHRA offerings in current and new markets to accelerate growth.
Beyond ICHRA expansion, Oscar has room to grow our addressable ACA opportunity. Over the next three years we will expand our current and new market presence, and are targeting an increase of our footprint by 150+ MSAs. We will introduce innovative plan designs that help some of the largest and fastest growing demographic segments. Lastly, we will work toward achieving mature industry-standard operating margins by advancing medical cost management and realizing administrative cost efficiencies through technology and strategic use of AI.
Driving Differentiated Offerings
Oscar’s innovative, consumer-centric brand drives exceptional experiences and engagement that makes us distinguishable in the market. We focus on improving the member and provider experience in everything we do, by:
Powering personalized engagement based on cultural preferences and individual health needs.
Driving better navigation and high-value clinical care through digital tools and process automation.
Solving key pain points that unburden providers – reducing administrative tasks, deepening network relationships, and enabling better care delivery for our members.
Powered by Our Technology
Our technology platform is an ever-increasing driver of our results – fueling growth and profitability, retention, and efficiencies for Oscar Insurance and powering the healthcare system through +Oscar.
AI will further power what we can do. We have various high-value AI use cases in the pipeline, including: virtual care and claims processing, to reduce administrative costs; member personalization, to drive growth and retention; and medical record extraction, to lower medical costs.
+Oscar is early in building and delivering health tech solutions that meet the needs of the healthcare system. We will continue to enhance these offerings by:
Further commercializing our Campaign Builder product to solve key client challenges.
Expanding our suite of health management capabilities to enable clients managing healthcare risk.
Bringing new multi-payer technology solutions to new markets, including Medicare Advantage.
Oscar’s Ambitious Road Ahead
Oscar is building the individual market of the future, one that: reorients healthcare around individuals and families, gives greater choice and buying power, and grows with people at every stage of life. Oscar helps people take charge of their health like never before: their way, through our technology. We will continue to prove that an exceptional healthcare experience is not only possible – it is what consumers deserve and need to live healthier lives.
This blog post contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact contained herein are forward-looking statements. These statements include, but are not limited to, statements about our vision, financial outlook, estimates, targets and prospects, our management’s business strategy and plans and objectives for future operations, and general healthcare industry market conditions and trends. In some cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “targets,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential,” or “continue” or the negative of these terms or other similar expressions. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions, and uncertainties that are difficult to predict and generally beyond our control. Although management believes that the expectations reflected in these forward-looking statements are reasonable as of the date made, there are or will be important factors that could cause our actual results to differ materially from those indicated in these forward-looking statements, including, but not limited to, the factors set forth under the caption “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the Securities and Exchange Commission (“SEC”), and our other filings with the SEC. You are cautioned not to place undue reliance on any forward-looking statements made in this blog post. Any forward-looking statement speaks only as of the date as of which it is made, and, except as otherwise required by law, we do not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise. New factors emerge from time to time, and it is not possible for us to predict which will arise.
