Brew Markets: "Inside the Health Insurance Recovery Plan at Oscar"
Host: Ann Berry
Guest: Scott Blackley, CFO of Oscar Health
Date: February 20, 2026
Episode Overview
In this episode, Ann Berry dives into the complexities of the U.S. health insurance sector, spotlighting Oscar Health—a fast-growing, tech-driven insurance company—and its recovery plan after a tumultuous 2025. CFO Scott Blackley unpacks Oscar’s massive year-over-year membership growth, the shifting dynamics of the ACA marketplace, the economics and challenges of health insurance pricing, and Oscar’s strategies for leveraging technology and AI to drive customer satisfaction and profitability. The conversation also tackles industry jargon, the prospects of personalized health insurance, and the company’s journey in the public markets.
1. Oscar's Membership Growth and Demographic Shift
Timestamps: 02:42–04:13
- Oscar's Growth: Oscar has grown to 3.4 million members as of February 1, 2026, up from 2 million at the end of 2025—a testament to its rapid expansion.
- Scott Blackley: “…significant growth in the business. And it really is a very diverse swath of America… gig workers, self-employed contractors, farmers...” (02:49)
- Changing Demographics: The core membership has expanded beyond the initial base of "glamorous, independent designers," taking on a wider cross-section of Americans typically without employer-based health coverage.
- ACA Focus: Oscar's primary market is the ACA (Obamacare) exchanges, with a significant share, especially in states like Florida.
2. Navigating Regulatory Uncertainty in the ACA
Timestamps: 04:13–05:19
- Political Landscape: Blackley argues that existential threats to the ACA are fading—current policy debates focus on improving rather than eliminating the ACA.
- Scott Blackley: “…the existential risk for the ACA marketplace…I think that's behind us…dialogue has shifted to how do we improve…which we think is a really good shift...” (04:13)
- Regulatory Focus: Key concerns are fraud reduction and ensuring proper eligibility, which Oscar sees as positives for market stability.
3. The Mechanics of State-by-State Expansion
Timestamps: 05:19–06:48
- State-Centric Market: Health insurance expansion requires regulatory approval at the state level, making growth a market-by-market play.
- “Land and Expand” Strategy: Oscar methodically enters new states (up to 20 in 2026), establishes a foothold, adapts its products, and gradually scales up its presence.
- Scott Blackley: “…you go in, you kind of establish a foothold, learn the membership, learn how the health systems work and adjust your product mix and then you start to grow.” (06:07)
4. Financial Performance: Growth and Profitability Challenges
Timestamps: 06:48–09:49
- Revenue Surge, Profitability Dip: Despite revenue leaping to $11.7B in 2025 (from $9.2B), Oscar swung from near $200M EBITDA profit to a $280M loss.
- Market-Wide Pressures: Policy changes in 2025, including advanced pricing and changed subsidy structures, led to industry-wide losses. Blackley calls it a “market reset” year.
- Scott Blackley: “…you price a year in advance…if you don't know what the rules are…we all got caught a little bit offsides…” (07:44)
- Two Key Policy Shifts:
- Program Integrity Initiatives: CMS cracked down on proper disbursement of ACA subsidies, affecting marketplace composition and enrollment.
- Medicaid Redetermination: Post-COVID, states moved people off Medicaid and into ACA plans—these new members used more healthcare than anticipated, driving up costs.
- Scott Blackley: “…[Medicaid redetermination members] came in with much higher utilization patterns than I think any of us expected…” (08:46)
5. Key Industry Metrics: Medical Loss Ratio (MLR) and Pricing Discipline
Timestamps: 09:49–11:55
- MLR Surge: Oscar’s MLR rose from just under 82% (2024) to 87.4% (2025), cutting into profitability.
- Ann Berry: “…MLR…tick[ed] up to 87.4%…a meaningful jump up, particularly off…large revenue numbers…” (09:53)
- Oscar’s 2026 Plan: Guidance targets a ~5-point reduction in MLR, primarily via stricter actuarial pricing, repricing for expected utilization, and managing risk from expiring ACA subsidies.
- Scott Blackley: “The first and most important lever there is discipline pricing…we've built in all of that utilization risk…” (10:41)
6. Industry Trends: Personalization vs. Market-Based Underwriting
Timestamps: 13:43–16:30
- Underwriting Reality: In health insurance, risk is pooled and priced by market, clashing with the broader consumer push for personalized products.
- Scott Blackley: “…one of the profound problems in health insurance today is most of our country receives health insurance from their employer…you’re stuck in that very narrow box…” (14:40)
- Oscar’s Vision: Increase individual choice by expanding ACA and similar products, enabling tailored plans for specific needs (e.g., diabetes plans).
- Scott Blackley: “The future of health insurance is a more individualized, you know, personal opportunity to pick your plan and to stick with the doctors you want.” (16:16)
7. ICHRA: The Individual Contribution HRA & Its Disruptive Potential
Timestamps: 16:30–21:00
- What is ICHRA? An employer-funded, 401(k)-style approach to health insurance—employers contribute funds; employees buy ACA plans that suit their needs.
- Scott Blackley: “…instead of the employer buying the health plan for you, they put money into an account and then you're able to use that money to go out onto the ACA and buy the plan that's right for you.” (16:42)
- Winners & Losers: Oscar stands to gain as the ACA becomes more central; large, incumbent commercial insurers risk losing share as small and midsize businesses embrace ICHRAs.
- Strategic Focus: Oscar is pushing hard to increase uptake among employers but acknowledges hurdles—organizational inertia and the need for evidence of market stability and cost savings.
8. Technology as a Differentiator: Oswell AI and Tech Leadership
Timestamps: 21:00–25:16
- Oswell AI: Oscar’s proprietary generative AI platform offers personalized support, streamlined answers about claims, benefits, doctors, and more.
- Scott Blackley: “…it’s taking the best of large language models and then it’s feeding it with all of the systems and data that we have about a member…We’ve just seen a profound shift in the speed of the answer, the accuracy…” (21:19)
- Full Stack Advantage: Oscar’s tech stack is custom-built, cloud-native, and fully interoperable, allowing seamless integration of AI across business functions.
- Scott Blackley: “…I don’t know of any other health insurer who has a completely custom built tech chassis…one data environment, which I think is a profound difference.” (23:33)
- AI as a Growth Engine: Oscar applies AI both to improve member experience (e.g., faster, more accurate service) and operational efficiency (e.g., cost management, finance functions).
- Scott Blackley: “I just think we're on the very front end of being able to both manage our costs and improve our MLR and expand our product set in ways that maybe even two years ago we could not have ever imagined…” (25:08)
9. Oscar’s Investor Narrative: Scale, Technology & the Path Forward
Timestamps: 25:16–28:16
- Public Market Challenges: Oscar’s share price is down 60% since IPO in the frothy "go go days" of 2021, but scale and capabilities have fundamentally improved.
- Ann Berry: “…what do you say to the market? …do you say to them, look, we were just overvalued when we went out…?” (25:54)
- Growth Opportunity: With nearly $19B projected revenue for 2026, Blackley argues the scale will unlock operational leverage and profitability.
- Scott Blackley: “So really the message…is, number one, you know, we believe that we can grow faster than the market and this is a market that's going to continue to grow…We've demonstrated that, you know, over every year of our history.” (26:44)
- 2026 as a Proving Ground: Blackley positions the coming year as pivotal for demonstrating Oscar’s differentiated value and capturing improved market performance.
- Scott Blackley: “…I think most investors right now are looking for us to prove the case. And we think that 26 is going to be the year where we can really demonstrate that we are a differentiated player in a very big market…” (27:42)
10. Notable Quotes & Memorable Moments
-
Ann Berry, on Oscar’s origins:
“Lots of folks who I knew had taken out Oscar Health insurance tended to be quite glamorous themselves. They were kind of the cool, independent designers… That was then, that was…14 years ago.” (01:48) -
On ACA stability:
“I think that dialogue has shifted to how do we improve the effectiveness and the impact, make it better, cheaper, better for the consumer, which we think is a really good shift…”
— Scott Blackley (04:27) -
On industry pricing:
“You price a year in advance basically for your products. And if you don't know what the rules are that are going to be imposed, we all got caught a little bit offsides…”
— Scott Blackley (07:44) -
On ICHRA as a game-changer:
“If you transition to a NICRA plan, you get more predictability, it is definitely going to be cheaper and your employees have more choice, which is what they want.”
— Scott Blackley (18:24) -
On the tech stack’s uniqueness:
“I don't know of any other health insurer who has a completely custom built tech chassis. And all of the functions that we need to deliver health care have been, you know, purpose built and they're interoperable.”
— Scott Blackley (23:33) -
On proving the Oscar story to investors:
"We think that 26 is going to be the year where we can really demonstrate that we are a differentiated player in a very big market. And so…I think it’s a terrific time from an entry point to come into the stock."
— Scott Blackley (27:38)
11. Conclusion
Scott Blackley’s conversation offers a transparent look at Oscar Health’s challenges and ambitions. The company is betting big on technological edge and regulatory changes to drive customizable, affordable health insurance. 2026 is positioned as the pivotal year for turning tech-driven growth into sustainable profitability—and possibly, market vindication.