Oscar Health Reports Strong Q1 Results Amid Concerns Over Proposed ACA Changes

Oscar Health, a prominent player in the health insurance market, has reported impressive first-quarter results for 2025, with significant membership growth and financial gains. However, the company's leadership has expressed concerns about proposed changes to the Affordable Care Act (ACA) that could impact future enrollment and coverage.

Record-Breaking Financial Performance

Oscar Health closed the first quarter of 2025 with two million members, generating revenue of $3 billion and a net income of $275 million. The company's stock surged by 30% following the announcement of these results. Oscar reported an earnings per share of $0.92, exceeding analysts' estimates of $0.83. The medical loss ratio increased by 120 basis points to 75.4%, while the company achieved its lowest selling, general, and administrative expense ratio in its history at 15.8%.

Concerns Over Proposed ACA Changes

Despite the strong financial performance, Oscar Health's executives voiced apprehension about potential changes to the ACA during their earnings call. CEO Mark Bertolini expressed support for program integrity initiatives but criticized specific proposed alterations:

1. Shortened Enrollment Window: The Centers for Medicare & Medicaid Services (CMS) has proposed shortening the open enrollment period to end on December 15, rather than extending into January. Bertolini argued that this change would "constrain Americans' ability to shop amid many enrollment changes for 2026."

2. Elimination of Special Enrollment Period: CMS has also suggested eliminating the monthly special enrollment period for households at 150% of the federal poverty level.

3. Cost-Sharing Reductions (CSRs): Some Congressional members have proposed reintroducing CSRs as a cost-saving measure. CFO Scott Blackley cautioned against this, stating, "I think practically speaking, that's a big undertaking for plans to try to put into place the processes and infrastructure. So, we will be recommending that the government not move forward with that in 2026."

Innovation and Market Expansion

Despite regulatory challenges, Oscar Health continues to innovate and expand its market presence:

1. Virtual Urgent Care: The company highlighted its virtual urgent care live chat feature, which has decreased member response times by 90%.

2. Social Determinants of Health: Oscar launched Oscar Community Resources in partnership with FindHelp, a social care network addressing social determinants of health.

3. ICHRA Growth: The company reported "increased momentum" in the Individual Coverage Health Reimbursement Arrangement (ICHRA) space, particularly among larger groups in the mid-market segment.

As the healthcare landscape continues to evolve, Oscar Health's strong financial performance and innovative approaches position it well for future growth, even as it navigates potential regulatory challenges in the ACA marketplace.