Tech-friendly, consumer empowerment-focused health insurance startup Oscar Health has closed a $165 million funding round led by Brian Singerman and Founders Fund, according to a recent blog post from the company’s cofounders. Other participants in the round included Verily Life Sciences, Fidelity, 8VC, General Catalyst, Capital G, Khosla Ventures, Thrive Capital, and other unnamed investors.
“After generating an underwriting profit in 2017 and enrolling nearly 250,000 members this year — projecting north of $1 billion in gross premium revenue — Oscar stands strong as the first technology-driven health insurer,” cofounders Mario Schlosser, CEO, and Joshua Kushner wrote in the post. “Having engineered a custom-designed, full-stack insurance platform linking our real-time analytics infrastructure with the best consumer product in health care, Oscar is now taking the highest levels of member engagement in the industry and translating it into better, easier care for hundreds of thousands of Americans.”
Describing itself as the “first-ever technology-driven health insurer,” Oscar Health’s strategy involves engaging members in their care using a virtual, personalized platform. With this, the company guides its members toward more affordable care options while, on the provider side, offering operational integrations and easy-to-use tools for major health system partners. Oscar Health’s offerings also include Doctor on Call, a telemedicine platform and mobile app built in-house to provide quick, low-cost virtual care to members.
Oscar Health’s approach appears to be working, as the company has announced numerous market expansions and partnerships with Cleveland Clinic, Humana, AXA, and others over the past year. Schlosser and Kusher wrote that the new funding will be used to accelerate similar moves as the company continues to grow, with expansions planned at a rate of roughly four or five cities annually across various market segments.
On the other hand, financial documents filed earlier this month show that Oscar Health lost $127 million on $229 million of revenue in 2017.
"We need no reminder that the stakes are high — an opaque, uncompetitive system has led to skyrocketing premiums and deductibles, and far too many Americans have been asked to sacrifice their wages for health care they can’t afford to use,” they wrote. “With every new member, Oscar can help bring the system a little closer to where it should be.”