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Oscar Insurance Strategy
Alessa Quane, Chief Insurance Officer, shares Oscar Insurance’s strategic pillars.
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We recently hosted our 2024 Investor Day where we shared updates across our business and mapped out Oscar’s longer term company strategy. Below we will take a deep dive into Chief Insurance Officer Alessa Quane’s presentation on Oscar Insurance.
Alessa opened her session highlighting Oscar Insurance’s accomplishments that have enabled us to grow into one of the Affordable Care Act’s (ACA) top players.
Since 2021, we have:
Grown our membership to 1.5M as of April 2024
Steadily grown our share of the ACA from 4% in 2021 to ~7% as of 1Q24.
“It’s based on this success that we plan to deliver on our mission of making healthcare more affordable and accessible to more Americans,” she said.
Oscar Insurance’s Three Strategic Pillars
Since our last Investor Day two years ago, we have continued to focus our portfolio and resources on market-level strategies. With greater scale and deepened ACA experience, we’ve learned what works for Oscar and how to leverage our team to execute successfully. We have designed our growth strategy around three core pillars: Disciplined footprint expansion, innovative products and experiences, and robust Total Cost of Care management.
Disciplined footprint expansion:
The Oscar team has developed extensive expertise in the ACA space and we firmly believe a more individualized marketplace will better serve Americans. We are uniquely positioned to capitalize on what we believe to be a significant runway for growth in the individual market. Today, our current footprint reaches only 50% of the ACA market. By 2027, we plan to extend our reach to up to 70% of the ACA - with additional room for growth beyond that. Not only do we believe in our long runway to serve more markets, but we also believe there is a future opportunity to grow the ACA individual market itself through Individual Coverage Health Reimbursement Arrangements (ICHRA).
Innovative products and experiences:
Our product innovation starts with the member in mind; it is supported by our technology, and focuses on easing the challenges individuals find in the market today. One of the challenges we are attempting to address is reducing cultural barriers to care. For context, the Hispanic and Latino population is the fastest growing cohort in the ACA, and represents about ⅓ of Oscar’s current membership. We have leveraged HolaOscar (opens in new tab), our Spanish-first product, to better serve our Spanish-speaking members. This product has served as a proof point for how delivering culturally authentic experiences can lead to better outcomes for our members. Our overall Spanish-speaking retention and net promoter score (NPS), are higher than non-Spanish speaking members. It has also led to an outsized broker NPS, with Spanish-speaking brokers reporting up to ~30% higher satisfaction levels. We’re scaling this experience to more markets, and exploring how we can replicate HolaOscar’s success with other culturally authentic experiences in the future.
A secondary challenge we are attempting to address is how members receive care for their chronic conditions. Many Americans suffer from chronic conditions that require specific care that can impact their cost of healthcare differently. To address this, we have designed profitable products to address specific chronic conditions, including COPD and diabetes. Our Diabetes Plan (opens in new tab) has been available in select markets since 2022 and includes benefits designed to lower out-of-pocket costs for services members need to manage their diabetes. These include $0 for tier 1a drugs, a $100 out-of-pocket maximum on insulin, and free primary care visits*. Beyond these uniquely designed benefits, the plan also leverages technology to deliver a tailored care journey, better access to relevant services and, ultimately, a superior member experience. Members enrolled in this plan have seen notable results relative to diabetics on other Oscar plans: 9% better adherence to diabetes medications, 17% higher rates of eye exam screenings, and 12% higher rates of kidney disease screenings. Given these results, we will continue to explore the launch of new products to address targeted conditions.
Robust Total Cost of Care management:
Lastly, driving affordability is a critical lever for delivering on our long term financial targets and our mission to lower medical costs for our members. If we can continue to drive offsets to trend with this work, we can price competitively to fuel growth but also deliver on the margin improvement that is central to our overall strategy. We call this work, total cost of care. These initiatives do not drive one-off savings, but rather eliminate spend sustainably. The savings are not concentrated in any one area, but come from a diversified pipeline of opportunities. We have a track record of executing. Our teams are focused and are supported by our technology which allows us to deliver on our targets.
“The Oscar team is executing,” Alessa said. “We have a focused plan that leverages learnings from our successful execution over the last few years and technology to support us. We are confident that there is a long runway in the individual market and that our strategies are going to position us to take advantage of that. Most importantly, we are really excited and eager to deliver on this mission of making healthcare accessible and affordable to more individuals by growing both our market footprint as well as the ACA market itself.”
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.
*If any medical conditions or issues are found or detected during the member’s visit, there may be associated costs for further evaluation, diagnostic tests, or necessary treatments. Members may refer to their summary of benefits and coverage to determine the cost of their planned visit, as well as any applicable cost-sharing.
