Oscar, a New York City-based health insurance technology company, has raised $140 million in a funding round announced just half a year after its last $225 million raise. The new investment was headed by Tiger Global Management, and also saw funds from Dragoneer, Baillie Gifford, Coatue, Founders Fund, Khosla, Lakestar and Reinvent.
WHAT IT DOES
Oscar describes itself as the "first-ever technology-driven health insurer.” It offers direct-to-consumer health plans that seek out and guide members toward optimal and cost-effective care options – which can include the 24/7 virtual care services offered by Oscar itself, called Doctor on Call. The company says this approach has led to higher engagement among its members.
Oscar said that this year's influx of funding comes at a period of growth for the company. In the announcement, it highlighted a 74% increase in direct policy premiums over the last three years, and 420,000 members across 15 states as of the end of September.
Going into the close of 2021 Open Enrollment, the company said its individual and family plans, Medicare Advantage offerings, and small group products will be available in 18 states and 286 counties.
WHAT IT'S FOR
Oscar anticipates more growth in its future, and wants to leverage its new funding to reach more potential enrollees.
"As we continue to rapidly scale our business, this capital will help us deliver on our commitment to bring accessible and affordable care to even more Oscar members across the country," Mario Schlosser, cofounder and CEO of Oscar, said in a statement.
"Insurtech" companies like Oscar have maintained steady momentum over the last few years, a trend that the companies say is fueled by the public's frustration with rising costs and appetite for consumer-friendly takes on health insurance. And while much of the healthcare industry has been shaken by COVID-19, investors seem to still be onboard with the pitch.
Along with Oscar's double dip into the equity investor pool, Bright Health closed half a billion in Series E funding back in September while working to expand into new markets.
Another name in the space is Clover Health. After a tumultuous 2019, consisting of a major fundraise, substantial layoffs and the launch of a drug development subsidiary, the company announced recently that it plans to join the public market via special purpose acquisition company (SPAC) in 2021.