(Bloomberg) — Oscar Insurance Corp. is starting to stem the bleeding after years of reporting large losses.
The privately held health insurer, created to sell plans under the Affordable Care Act, lost $25.8 million across three states in the first three months of this year, compared with a loss of $48.5 million a year earlier, according to regulatory filings Tuesday. The company is beginning to get a handle on its medical costs, as the premiums it collected exceeded what it spent on health services.
The ACA public health insurance exchange system, and the off-exchange market for ACA-compliant coverage, have presented challenges for even experienced insurers. Oscar made big changes ahead of 2017, boosting premiums, pulling out of two regions and sharply limiting its network of hospitals and doctors in New York, its largest market.
“In 2017 I feel for the first time that all those pieces are in place,” Chief Executive Officer Mario Schlosser told attendees Monday at the TechCrunch Disrupt conference in New York, before the results were disclosed. “I think we will have a much better performance than in 2016.”
Changing the Affordable Care Act
Senate Republicans are working on a plan to de-fund and change the Affordable Care Act, arguing it’s already failing. Aetna Inc., Humana Inc., and UnitedHealth Group Inc. have all retreated from offering plans through the individual major medical market, after recording hundreds of millions of dollars in losses. The House recently passed H.R. 1628, the American Health Care Act bill. The bill could replace the current ACA premium subsidy program and cost-sharing reduction subsidy programs with new programs. That could jeopardize companies like Oscar that are designed to work with the current ACA exchange system and individual health insurance rules.
Oscar has its own ties to the political drama. Co-founder Joshua Kushner is brother to Jared Kushner, a senior adviser to President Donald Trump and the husband of Trump’s daughter Ivanka. The company has said it isn’t gaining any special insights from the Kushner brothers’ relationship.