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Oscar Health, Inc. ir.hioscar.com | |
Oscar Health, Inc.
Supplemental Financial Information
Financial Statement Presentation
2023 Quarterly and Annual Results of Operations and Key Metrics
This presentation is for informational purposes only and includes financial information that is unaudited. This presentation should be read in conjunction with documents filed by Oscar Health, Inc. (the “Company”) with the U.S. Securities and Exchange Commission, including the Company’s most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q.
2023 Quarterly and Annual Results - Recast Presentation of the Statement of Operations
Beginning with Oscar Health, Inc.’s Quarterly Report on Form 10-Q for the three months ended March 31, 2024, the Company will present certain reclassifications to the Statement of Operations to provide more transparency into the Company’s streams of revenue and to increase comparability with peers. The accompanying Condensed Consolidated Statements of Operations for the fiscal year ended December 31, 2023 and quarterly periods therein have been recast to reflect these reclassifications. The reclassifications do not affect the Company’s net income and do not represent error corrections.
Oscar Health, Inc.
Condensed Consolidated Statements of Operations
(unaudited)
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| | | Three Months Ended | | Year Ended |
| (in thousands) | | | | | March 31, 2023 | | June 30, 2023 | | September 30, 2023 | | December 31, 2023 | | December 31, 2023 |
| Revenue | | | | | | | | | | | | | |
| Premium | | | | | $ | 1,428,626 | | | $ | 1,474,966 | | | $ | 1,392,082 | | | $ | 1,390,395 | | | $ | 5,686,069 | |
| Investment income | | | | | 36,056 | | | 41,484 | | | 42,368 | | | 35,539 | | | 155,447 | |
| Services and other | | | | | 5,003 | | | 5,085 | | | 5,541 | | | 5,724 | | | 21,353 | |
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| Total revenue | | | | | 1,469,685 | | | 1,521,535 | | | 1,439,991 | | | 1,431,658 | | | 5,862,869 | |
| Operating Expenses | | | | | | | | | | | | | |
| Medical | | | | | 1,091,592 | | | 1,181,999 | | | 1,163,194 | | | 1,205,239 | | | 4,642,024 | |
| Selling, general, and administrative | | | | | 398,519 | | | 337,244 | | | 325,850 | | | 364,155 | | | 1,425,768 | |
| Depreciation and amortization | | | | | 4,939 | | | 8,821 | | | 9,191 | | | 7,741 | | | 30,692 | |
| Total operating expenses | | | | | 1,495,050 | | | 1,528,064 | | | 1,498,235 | | | 1,577,135 | | | 6,098,484 | |
| Earnings (loss) from operations | | | | | (25,365) | | | (6,529) | | | (58,244) | | | (145,477) | | | (235,615) | |
| Interest expense | | | | | 6,136 | | | 6,120 | | | 6,130 | | | 6,217 | | | 24,603 | |
| Other expenses | | | | | 6,106 | | | 1,612 | | | 414 | | | (1,050) | | | 7,082 | |
| Earnings (loss) before income taxes | | | | | (37,607) | | | (14,261) | | | (64,788) | | | (150,644) | | | (267,300) | |
| Income tax expense | | | | | 2,021 | | | 1,164 | | | 915 | | | (806) | | | 3,294 | |
| Net income (loss) | | | | | (39,628) | | | (15,425) | | | (65,703) | | | (149,838) | | | (270,594) | |
| Less: Net income attributable to noncontrolling interests | | | | | 144 | | | 103 | | | (305) | | | 192 | | | 134 | |
| Net income (loss) attributable to Oscar Health, Inc. | | | | | $ | (39,772) | | | $ | (15,528) | | | $ | (65,398) | | | $ | (150,030) | | | $ | (270,728) | |
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Key Operating and Non-GAAP Financial Metrics
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| | | Three Months Ended | | Year Ended |
| (in thousands, except percentages) | | | | | March 31, 2023 | | June 30, 2023 | | September 30, 2023 | | December 31, 2023 | | December 31, 2023 |
| Total revenue | | | | | $ | 1,469,685 | | | $ | 1,521,535 | | | $ | 1,439,991 | | | $ | 1,431,658 | | | $ | 5,862,869 | |
Medical Loss Ratio (MLR)(1) | | | | | 76.3 | % | | 79.9 | % | | 83.8 | % | | 86.4 | % | | 81.6 | % |
| SG&A Expense Ratio | | | | | 27.1 | % | | 22.2 | % | | 22.6 | % | | 25.4 | % | | 24.3 | % |
Adjusted EBITDA(2) | | | | | $ | 51,068 | | | $ | 35,572 | | | $ | (20,285) | | | $ | (111,593) | | | $ | (45,238) | |
(1)Further information on Medical Loss Ratio can be found in the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on May 7, 2024.
(2)Adjusted EBITDA is a non-GAAP measure. See below for a reconciliation to net loss, the most directly comparable GAAP measure. Further information on Adjusted EBITDA can be found in the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on May 7, 2024.
Medical Loss Ratio (MLR)
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| Three Months Ended | | Year Ended |
| (in thousands, except percentages) | March 31, 2023 | | June 30, 2023 | | September 30, 2023 | | December 31, 2023 | | December 31, 2023 |
| Medical | $ | 1,091,592 | | | $ | 1,181,999 | | | $ | 1,163,194 | | | $ | 1,205,239 | | | $ | 4,642,024 | |
Less: Ceded quota share reinsurance claims (1) | $ | (6,435) | | | $ | 2,786 | | | $ | 4,870 | | | $ | (3,277) | | | $ | (2,056) | |
Net claims before ceded quota share reinsurance (A) | $ | 1,085,157 | | | $ | 1,184,785 | | | $ | 1,168,064 | | | $ | 1,201,962 | | | $ | 4,639,968 | |
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| Premium | $ | 1,428,626 | | | $ | 1,474,966 | | | $ | 1,392,082 | | | $ | 1,390,395 | | | $ | 5,686,069 | |
Less: Ceded quota share reinsurance premiums (2) | $ | (6,655) | | | $ | 7,338 | | | $ | 1,448 | | | $ | 80 | | | $ | 2,211 | |
Net premiums before ceded quota share reinsurance (B) | $ | 1,421,971 | | | $ | 1,482,304 | | | $ | 1,393,530 | | | $ | 1,390,475 | | | $ | 5,688,280 | |
Medical Loss Ratio (A divided by B) | 76.3 | % | | 79.9 | % | | 83.8 | % | | 86.4 | % | | 81.6 | % |
(1)Represents prior period development for claims ceded to reinsurers pursuant to quota share treaties, which are accounted for under reinsurance accounting and are in runoff.
(2)Represents prior period development for premiums ceded to reinsurers pursuant to quota share treaties, which are accounted for under reinsurance accounting and are in runoff.
Reconciliation of Adjusted EBITDA to Net Loss
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| Three Months Ended | | Year Ended |
| (in thousands) | March 31, 2023 | | June 30, 2023 | | September 30, 2023 | | December 31, 2023 | | December 31, 2023 |
| Net income (loss) | $ | (39,628) | | | $ | (15,425) | | | $ | (65,703) | | | $ | (149,838) | | | $ | (270,594) | |
| Interest expense | 6,136 | | | 6,120 | | | 6,130 | | | 6,217 | | | 24,603 | |
| Other expenses (income) | 6,106 | | | 1,612 | | | 414 | | | (1,050) | | | 7,082 | |
| Income tax expense (benefit) | 2,021 | | | 1,164 | | | 915 | | | (806) | | | 3,294 | |
| Depreciation and amortization | 4,939 | | | 8,822 | | | 9,191 | | | 7,742 | | | 30,694 | |
Stock-based compensation (1) | 71,494 | | | 33,279 | | | 28,768 | | | 26,142 | | | 159,683 | |
| Adjusted EBITDA | $ | 51,068 | | | $ | 35,572 | | | $ | (20,285) | | | $ | (111,593) | | | $ | (45,238) | |
(1)Represents non-cash expenses related to equity-based compensation programs, which vary from period to period depending on various factors including the timing, number, and the valuation of awards. The three months ended March 31, 2023, includes a non-recurring charge of $46.3 million related to accelerated stock-based compensation expense recognized as a result of the cancellation of the Founders Awards previously granted to Mario Schlosser and Joshua Kushner.
