How Oscar Makes Money

Oscar Health is a startup health insurance company that uses technology to differentiate it from traditional insurance providers and providing access to medical professionals, including free doctor visits and 24/7 consultations, and assistance in creating an individualized team of healthcare professionals within its network.

As of January 2022, Oscar insurance, which can be purchased on the “Obamacare” exchange program or directly from the company, also offers small plans in 22 states. These plans offer access to: free doctor-on-call service, free care team service, and no referral requirement to see specialists, as long as they are in-network.

The company’s calling card is accessible healthcare services complete with concierge health services and assistance with choosing an insurance plan. Oscar’s members even receive cash incentives (up to $100 per year) for keeping up with their daily step count, as the app can link up to many smart pedometers and watches.

Key Takeaways

  • Oscar Health offers a wealth of benefits to its clients, like access to on-call (24/7) doctors, a care team who will help you navigate the plans, and health-related cash incentives.
  • Oscar bills itself as a user-friendly and personalized service. Even its URL, “Hi Oscar,” reflects this identity.
  • As of January 2022, Oscar is available in 22 states.
  • Oscar offers four plans, and the pricing depends on a variety of factors, from the type of plan, where you live, your age, and family size.
  • Oscar’s members must stay within the company’s EPO or expect to pay full price for a doctor’s visit.

Oscar’s Industry

From its beginning in 2012, the founders of Oscar set out to design a health insurance company that provided simple coverage in an industry that can confuse consumers. There are no copays or coinsurance. Oscar wants customers to feel like they have a doctor in the family, giving them access to free advice 24 hours a day via the Oscar mobile app or by phone. Within 15 minutes, patients can talk to a board-certified doctor and get advice.

Oscar’s four-tier plans named after metals (bronze, silver, gold, and platinum) cover all doctor visits, and preventive care and generic drugs are free. The customer pays for everything else until he reaches the chosen plan’s out-of-pocket maximum. At this point, the policy completely pays for all additional costs for the remainder of the year.

Fundraising and Financials

As of July 2022, according to its website, Oscar had over 1 million members in 607 counties in 22 states. Since its inception, it has seen an infusion of cash support from outside backers. For example, in 2018, Alphabet invested $375 million into the then- six-year-old company. This cash infusion came just months after Capital G and Verily funded $165 million. In June 2020, Oscar announced the company closed a $225 million funding round, which positioned Oscar to continue growth off of a $2 billion revenue base, according to its website.

In the fourth quarter of 2020, Oscar closed a $140 million funding round led by Tiger Global Management, LLC, with participation from Dragoneer, Baillie Gifford, Coatue, Founders Fund, Khosla, Lakestar, and Reinvent. The fourth quarter financing comes “as Oscar continues to experience significant growth, seeing a 74% increase in direct policy premiums over the past three years,” according to the December 2021 press release.

Oscar offers catastrophic health insurance for healthy people under 30, if they qualify fo r a hardship or affordability exemption. This plan has the lowest premium but the highest deductible.

History and Leadership

The idea for Oscar was born in 2012 when CEO and co-founder Mario Schlosser and his wife were expecting their first child. According to the Oscar website, the couple found that navigating the road of insurance costs and jargon was difficult and overwhelming, especially for first-time parents. The company aimed to whittle down the complexities and provide their customer with a more personal approach to finding physicians and healthcare. Schlosser founded the company along with Josh Kushner and Kevin Nazemi.

The idea behind Oscar Health? Providing healthcare services using mobile technology with a user-friendly touch (the URL for the company is named ‘Hi Oscar”) for booking appointments, locating physicians, telemedicine, and around-the-clock access to medical professionals.

In 2016, the Oscar Center entered into a partnership with Mount Sinai Health System. This center provides members access to free classes such as health care for pregnant women and yoga, plus access to a primary care office. Like many FinTech companies, Oscar has tapped into the rapidly expanding merger of healthcare and technology. In addition, their New York clients can access health services at Montefiore Medical Center and the Long Health Network.

Recent Developments

According to a statement, Bloomberg reported that in December 2020, “Oscar raised $140 million this month in a funding round led by Tiger Global Management. That followed a $225 million round in June that included Thrive Capital. Other investors in one or both rounds included Dragoneer, Baillie Gifford, Coatue, Founders Fund, Khosla Ventures, Lakestar, Reinvent, Alphabet Inc General Catalyst. And according to reporting by TechCrunch, the company in its inception was designed in many ways to take advantage of Obamacare’s marketplace offerings and to add more traditional insurance companies like Cigna over time.

Mulberry Health Inc., d/b/a Oscar, announced that it has confidentially submitted a draft registration statement on Form S-1 to the U.S. Securities and Exchange Commission (the “SEC”) relating to the proposed initial public offering of its common stock. According to the December 2020 press release, “The size and price range for the proposed offering have not yet been determined. The initial public offering is expected to commence after the completion of the SEC review process, subject to market and other conditions.”

Advantages and Disadvantages

Oscar uses technology to make it simple for users to find medical professionals, along with free virtual and in-person doctor visits, plus consultations. It offers four plan tiers, all offering free preventive care and affordable drug prescriptions. The difference between the plans is in how much you pay versus how much your plan covers. Oscar’s in-depth customer service provides a “Care Team,” including three guides and a registered nurse, who is available to answer questions and help you find the best and most affordable localized care.

And there is no need for a referral to see specialists under Oscar’s plans.

Oscar is currently available in 22 states and 607 counties. One con to the service is that a potential policyholder is not eligible if they live outside of one of these locations. Another con, the reviews on the Better Business Bureau website are not all rosy, with some reviewers complaining that the system is slow to pay out claims.”

Oscar Health Pros and Cons


Easy to get a quote for healthcare coverage from Oscar 
Only available in 22 states as of July 2022

The medical care for each plan is the same across all four lans, but the cost varies on your deductible
Numerous complaints from customers posted on the BBB website

Offers cash and other incentives for keeping active and healthy
All four tiers may be expensive when compared to other plans

Provides personalized services, such as access to a 24/7 on-call doctor and a “care team” to help you choose the best health plan
If you go outside its providers, the cost could be high

All four health plans offer similar benefits, the difference is in the deductible 
Does not offer short-term or travel insurance

Is Oscar a Good Health Insurance?

Oscar offers strong member benefits such as a doctor-on-call, cash reward health incentives, and concierge assistance from its customer service team. If you live in one of the 22 states where it is available, it might be a good fit, especially if you are looking for personal attention from your health insurance provider. Oscar health is accessible via its app and website, and its extremely personalized customer service is unique.

Is Oscar Health Part of Obamacare?

Oscar is available within the individual market for the Affordable Care Act, also referred to as Obamacare. If you want to buy individual or family Obamacare coverage, you can buy it via Oscar.

Does Oscar Cover Pre-Existing Conditions?

Yes. Due to the passage of the Affordable Care Act. Health insurance companies cannot legally deny coverage or even charge separate premium rates based on an individual’s pre-existing conditions.

What Hospitals Accept Oscar?

For business plans, Oscar Health offers access to its hospital partners, Mount Sinai, Montefiore, and Catholic Health Services of Long Island. Individuals can check with their care team or search online to locate the best and closest hospitals within Oscar’s network.

Where Is Oscar Health Insurance Available?

As of July 2022, it is available in 22 states: California, Arkansas, Arizona, Colorado, Oklahoma, Kansas, Texas, Iowa, Illinois, Nebraska, Florida, Georgia, Iowa, Missouri, Tennessee, Pennsylvania, Virginia, Ohio, Michigan, New Jersey, New York, and North Carolina.

The Bottom Line

Oscar Health provides a personalized experience for those seeking affordable healthcare. It offers incentives to its customers to stay healthy, including a cash reward for getting a flu shop. Oscar offers a free generic drug plan and a concierge care team designed to help its members find the medical care and services they need. Members have access to an on-call doctor, as well. It offers four plan tiers with varying premiums and deductibles and offers a catastrophic plan for healthy young adults. Oscar may appeal to self-employed workers seeking a personalized approach to finding healthcare providers and who can afford it.

Oscar Health is only available in 22 states currently, and it uses an exclusive provider organization network (EPO). This type of coverage provides free or co-insurance from Oscar, but you have to use the providers within the network or risk being charged the full fee if you go out of the EPO list. As of July 2022, Oscar does offer dental or vision insurance with a bundled health plan.