Oscar Health said its key underwriting profits jumped in the first quarter as the company prepares to expand into new Medicare Advantage markets for next year.
The health insurance company, which has made its name offering individual coverage under the Affordable Care Act, has gradually expanded into new markets even as larger players like Aetna, Humana and UnitedHealth Group left the Obamacare business after being unable to successfully manage the costs of sick patients signing up for such coverage.
But Oscar said Wednesday its underwriting profit rose nearly 5% to $ 81.7 million in the first quarter of this year compared to $ 77.8 million in the year-ago period. The company, which is still considered a startup, didn’t disclose its total net income or loss for the period.
“Oscar’s first-quarter 2019 financial results demonstrate that Oscar continues to track toward its financial goals of growing a profitable core business capable of managing risk,” Oscar chief financial officer Sid Sankaran said in a statement accompanying the financial report. “As we prepare for further expansion in 2020, we currently serve 255,000 members across 14 markets in both our individual and small group products, up from 237,000 this time last year.”
Oscar has expanded its individual and small business coverage over the years into 14 markets in 9 states, forming partnerships with key doctors and hospitals including the Cleveland Clinic, offering narrow network plans while attracting noted providers. Oscar’s premium revenue rose 13% in the quarter to $ 353.5 million compared to $ 312.5 million in the year ago period.
Oscar tends to be located in big urban markets in New York, New Jersey, California, Tennessee, Ohio, Texas, Florida, Michigan and Arizona.
Though Oscar executives say they aren’t ready to disclose new markets they will enter in 2020 under the ACA, they disclosed last year plans to add Medicare Advantage plans to the company’s expanding portfolio of health insurance products thanks in part to a $ 375 million investment last year by Google parent Alphabet.
The Alphabet investment into Oscar comes as the Trump administration expands the services private health plans can offer seniors via Medicare Advantage plans. These private MA plans contract with the federal government to provide extra benefits and services to seniors than traditional Medicare, such as disease management and nurse help hotlines, with some also providing vision and dental care and wellness programs