Oscar Health (OSCR) investor relations material

Market performance and membership trends

• 2025 saw widespread losses due to misestimated market morbidity and the expiration of enhanced subsidies, leading to expected market shrinkage in 2026.

• Despite anticipated shrinkage, strong Open Enrollment resulted in 3.4 million members, with an expected Q2 start at 3 million after passive attrition.

• Pricing for 2026 was set at the high end of a 20%-30% shrinkage range, but actual shrinkage is trending toward the lower end.

• Membership retention is attributed to proactive planning, aggressive distribution, and plan design adjustments over the past two years.

• Members were mapped into more affordable plans, reducing attrition compared to peers.

Risk adjustment, profitability, and pricing

• New tools provide earlier risk assessment for new members, who tend to be younger and healthier, improving confidence in profitability.

• Retaining members generally have better profitability profiles due to more engagement and data over time.

• Risk adjustment payments are higher due to a healthier-than-average membership, with 20% of premium revenue allocated for risk transfer.

• Pricing for 2026 incorporates lessons from 2025, including market morbidity, integrity measures, and explicit margin expansion.

• Risk adjustment remains challenging due to market-wide relative calculations, but new reporting is expected to improve estimates.

Regulatory and integrity measures

• CMS introduced integrity measures in 2024 and 2025 to combat fraud, including stricter broker rules and subsidy qualification checks.

• Some measures, such as requiring a payment for passive re-enrollment, are currently stayed but expected to be implemented mid-2026 or in 2027.

• Pricing for 2026 assumes these integrity initiatives will take effect.

• The NBPP rulemaking codifies many of these proposals, supporting a stable market outlook.