Highlights from Oscar Health Inc (OSCR) Q4 2024 Earnings Call: Record Revenue Milestones and Exciting Developments!

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Highlights from Oscar Health Inc (OSCR) Q4 2024 Earnings Call: Record Revenue Milestones and Exciting Developments!

Total Revenue: Oscar Health experienced a remarkable 57% growth in total revenue, reaching $9.2 billion. This surge is linked to record membership numbers and strong retention rates.

Adjusted EBITDA: The company achieved a significant milestone by becoming profitable with an adjusted EBITDA of $100 million, marking an impressive $245 million improvement from the previous year.

Net Income: Oscar Health reported net income of $25 million, reflecting a robust $296 million increase compared to last year. This is the company’s first time achieving positive net income.

Medical Loss Ratio (MLR): The MLR remained stable, showing a slight increase of 10 basis points to 81.7%. This ratio reflects the percentage of premiums spent on medical care.

SG&A Ratio: The selling, general, and administrative expenses (SG&A) ratio improved by over 500 basis points, now at 19.1%. This shows the company’s effort to control costs effectively.

Fourth Quarter Revenue: In the fourth quarter alone, revenue increased dramatically by 67%, reaching approximately $4 billion. This strong performance highlights the company’s growth trajectory.

Fourth Quarter Adjusted EBITDA Loss: The adjusted EBITDA loss in the fourth quarter was approximately $113 million, remaining flat compared to the same period last year.

Cash and Investments: Oscar Health ended the year with a solid $4 billion in cash and investments, including $190 million at the parent level. This strong liquidity positions the company well for future growth.

Capital and Surplus: The insurance subsidiaries reported about $1.2 billion in capital and surplus, with $774 million classified as excess capital. This indicates strong financial health.

Market Expansion: Oscar Health has made significant gains in the market, especially in states like Florida, Tennessee, and Texas. They have also expanded successfully into new regions like North Carolina.

Technology Integration: The company’s use of technology, especially AI, is improving operations and member engagement. This integration helps reduce administrative burdens for providers and enhances care delivery.

Challenges Ahead: The MLR in the fourth quarter increased by 170 basis points from the previous year, indicating some pressure on profitability. Oscar Health is also dealing with challenges related to risk adjustment settlements that are impacting revenue and MLR.

Enrollment Dynamics: Oscar Health anticipates a 9.1% effectuation impact against actual paying members, hinting at potential enrollment declines. They face risks of attrition as members may find new employment or discontinue premium payments.

Future Investments: The company is investing in SG&A to support growth. While this may impact short-term profitability, it is expected to yield long-term benefits.

CEO Insights: During the earnings call, CEO Mark Bertolini discussed the importance of tracking premium payments, confirming that 1.8 million members have paid their premiums, reflecting the company’s commitment to maintaining a stable member base.

Pricing Strategy: Scott Black, CFO of Oscar Health, explained that the company’s balanced pricing strategy ensures enrollment of engaged members. They actively monitor for irregularities in enrollment processes, maintaining a disciplined approach to growth and profitability.



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Oscar Health, Medical Loss Ratio, basis points, Total Revenue, Fourth Quarter Revenue, Scott Black, Mark Bertolini