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What changed in Oscar Health, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Oscar Health, Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+660 added−548 removedSource: 10-K (2026-02-13) vs 10-K (2025-02-20)

Top changes in Oscar Health, Inc.'s 2025 10-K

660 paragraphs added · 548 removed · 448 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

112 edited+27 added−15 removed79 unchanged
Biggest changeFurther, implementation of the ACA brings with it significant oversight responsibilities by health insurers that may result in increased governmental audits, increased assertions of alleged False Claims Act (“FCA”) liability, and an increased risk of other litigation. Federal regulatory agencies continue to modify regulations and guidance related to the ACA and markets more broadly.
Biggest changeIf we fail to add new members or retain current members, or manage our membership growth appropriately to meet our business objectives, our business, revenue, operating results, and financial condition could be harmed”, “—Failure to accurately estimate our incurred medical expenses or overall market morbidity, or effectively manage our medical costs or related administrative costs could negatively affect our financial position, results of operations, and cash flows” and “—Any changes to the ACA and its regulations could materially and adversely affect our business, results of operations, and financial condition.” Further, implementation of the ACA brought with it significant oversight responsibilities by Health Insurance Entities that may result in increased governmental audits, increased assertions of alleged False Claims Act (“FCA”) liability, and an increased risk of other litigation. 15 Table of Contents Federal regulatory agencies continue to modify regulations and guidance related to the ACA and Health Insurance Marketplaces more broadly.
This centers around what we believe to be a compelling employee value proposition, that includes competitive pay and benefits, flexible work styles, opportunity to make real impact towards the Oscar mission, and ongoing performance development.
This centers around what we believe to be a compelling employee value proposition, that includes competitive pay, and benefits, flexible work styles, opportunity to make a real impact towards the Oscar mission, and ongoing performance development.
In addition, certain of our businesses are also subject to the Payment Card Industry Data Security Standard (“PCI-DSS”), which is a multifaceted security standard that is designed to protect credit card account data as mandated by PCI entities. We rely on vendors to assist us with PCI-DSS matters and to maintain PCI-DSS compliance.
In addition, certain of our businesses are also subject to the Payment Card Industry Data Security Standard (“PCI-DSS”), which is a multifaceted security standard that is designed to protect credit card account data as mandated by payment card industry entities. We rely on vendors to assist us with PCI-DSS matters and to maintain PCI-DSS compliance.
See “Risk Factors—Risks Related to Our Business—We make virtual healthcare services available to our members through Oscar Medical Group, in which we do not own any equity or voting interest, and our virtual care availability may be disrupted if our arrangements with providers like the Oscar Medical Group become subject to legal challenges.” AVAILABLE INFORMATION Our website is www.hioscar.com.
“Risk Factors—Risks Related to Our Business—We make virtual healthcare services available to our members through Oscar Medical Group, in which we do not own any equity or voting interest, and our virtual care availability may be disrupted if our arrangements with providers like the Oscar Medical Group become subject to legal challenges.” AVAILABLE INFORMATION Our website is www.hioscar.com.
It is uncertain whether we can recoup, through higher premiums or other measures, the increased costs caused by potential legislation, regulation, or court rulings. 13 Table of Contents State Regulation of Insurance Companies and HMOs Our insurance and HMO subsidiaries must obtain and maintain regulatory approvals to sell specific health plans in the jurisdictions in which they conduct business.
It is uncertain whether we can recoup, through higher premiums or other measures, the increased costs caused by potential legislation, regulation, or court rulings. 13 Table of Contents State Regulation of Insurance Companies and HMOs Our Health Insurance Subsidiaries must obtain and maintain regulatory approvals to sell specific health plans in the jurisdictions in which they conduct business.
To carry out the above tasks, CMS, state insurance regulators and other agencies periodically examine our current and past business practices, accounts and other books and records, operations and performance of our health plans, compliance with contracts, adherence to governing rules and regulations and the quality of care we provide to our members, including the quality, credentialing, availability and accessibility of contracted network providers.
To carry out the above tasks, CMS, state insurance regulators and other agencies periodically examine our current and past business practices, financials, accounts and other books and records, operations and performance of our health plans, compliance with contracts, adherence to governing rules and regulations and the quality of care we provide to our members, including the quality, credentialing, availability and accessibility of contracted network providers.
Based on our experience in Health Insurance Marketplaces to date, we have made adjustments to our premium rates and participation footprint, and we will continue to evaluate the performance of such products going forward. In addition, insurers have faced uncertainties related to federal government funding for various ACA programs.
Based on our experience in Health Insurance Marketplaces to date, we have made adjustments to our premium rates and participation footprint, and we will continue to evaluate the performance of our products going forward. In addition, insurers have faced uncertainties related to federal government funding for various ACA programs.
Our use of cloud service providers in particular is strategic, due to platform level redundancy in networking and computer hardware. As an example, we distribute our Amazon Web Services-hosted platform across multiple availability zones in an effort to reduce the likelihood of infrastructure failure.
Our use of cloud service providers in particular is strategic, due to platform level redundancy in networking and computer hardware. As an example, we distribute our Amazon Web Services (“AWS”) hosted platform across multiple availability zones in an effort to reduce the likelihood of infrastructure failure.
We continue to believe that ICHRA will disrupt traditional employer group coverage and expand individual insurance beyond the traditional ACA market. Our goal is to position Oscar as the preferred carrier for employees enrolling in health insurance through an ICHRA program.
We continue to believe ICHRA will disrupt employer group coverage and expand individual insurance beyond the traditional ACA market. Our goal is to position Oscar as the preferred carrier for employees enrolling in health insurance through an ICHRA program.
In March 2017, the New York Department of Financial Services (“NYDFS”) promulgated Cybersecurity Requirements for Financial Services Companies, which were amended in 2023 and require covered financial institutions to establish, implement and maintain a cybersecurity program and cybersecurity policies and procedures that meet specific requirements.
In March 2017, the New York Department of Financial Services promulgated Cybersecurity Requirements for Financial Services Companies, which were amended in 2023 and require covered financial institutions to establish, implement and maintain a cybersecurity program and cybersecurity policies and procedures that meet specific requirements.
For example, under the regulations of certain states, our insurance subsidiaries may not declare or distribute a dividend to shareholders except out of earned surplus.
For example, under the regulations of certain states, our Health Insurance Subsidiaries may not declare or distribute a dividend to shareholders except out of earned surplus.
The regulations provide for state insurance regulators to conduct the reviews, except in cases where a state lacks the resources or authority to conduct the required rate reviews, in which cases HHS will conduct the reviews. • Prior to the implementation of the ACA, health insurers were permitted to use differential pricing based on factors such as health status, gender, and age.
The regulations provide for state insurance regulators to conduct the reviews, except in cases where a state lacks the resources or authority to conduct the required rate reviews, in which cases HHS will conduct the reviews. • Prior to the implementation of the ACA, Health Insurance Entities were permitted to use differential pricing based on factors such as health status, gender, and age.
We believe that our principal competitive features affecting our ability to retain and increase membership include the range and prices of health plans offered, breadth and quality of provider network, comprehensiveness of coverage, benefits and wellness programs, quality of service and member experience, responsiveness to member demands, market presence, financial stability, and reputation.
We believe that our principal competitive features affecting our ability to retain and increase membership include the range and prices of health plans offered, breadth and quality of provider network, comprehensiveness of coverage, benefits and wellness programs, quality of service, and member experience, responsiveness to member needs, market presence, financial stability, and reputation.
Inspire and provoke. Develop and display leadership at all levels. Fight to be the best. 6. Be transparent. Give and ask for direct feedback. Be grateful for and excited by the help of others. 7. Make it right. Admit your mistakes. Then learn from them. Never build alone.
Develop and display leadership at all levels. Fight to be the best. 6. Be transparent. Give and ask for direct feedback. Be grateful for and excited by the help of others. 7. Make it right. Admit your mistakes. Then learn from them. Never build alone.
(2) A member covered under more than one of our health plans counts as a single member for the purposes of this metric.
A member covered under more than one of our health plans counts as a single member for the purposes of this metric.
The ACA prohibits health insurers selling ACA-regulated plans in the individual market from using health status and gender in the determination of the insurance premium. In addition, age rating under the ACA is limited to a 3:1 ratio for adults age 21 and older, and tobacco use rating is limited to a 1.5:1 ratio.
The ACA prohibits Health Insurance Entities from selling ACA-regulated plans in the individual market from using health status and gender in the determination of the insurance premium. In addition, age rating under the ACA is limited to a 3:1 ratio for adults age 21 and older, and tobacco use rating is limited to a 1.5:1 ratio.
Failure to meet the minimum MLR thresholds triggers an obligation to issue premium rebates to members. • The ACA directed the HHS Secretary to develop a system that rates qualified health plans (“QHPs”), certified by the Health Insurance Marketplace based on relative quality and price.
Failure to meet the minimum MLR thresholds triggers an obligation to issue premium rebates to members. • The ACA directed the HHS Secretary to develop a system that rates qualified health plans (“QHPs”), certified by the Health Insurance Marketplaces based on relative quality and price.
Corporate Practice of Medicine and Fee-Splitting Laws Oscar Medical Group, which consists of four physician-owned professional corporations, functions as a direct medical service provider and, as such, our arrangements with Oscar Medical Group are subject to additional laws and regulations.
Corporate Practice of Medicine and Fee-Splitting Laws Oscar Medical Group, which consists of five physician-owned professional corporations, functions as a direct medical service provider and, as such, our arrangements with Oscar Medical Group are subject to additional laws and regulations.
For information on risks associated with our information technology systems, see “Risk Factors—Risks Related to our Business—If we are unable to integrate and manage our information systems effectively, our operations could be disrupted” and “Risk Factors—Risks Related to our Business—If we or our partners or other third parties with whom we collaborate fail to protect confidential information and/or sustain a data security incident, we could suffer increased costs, material financial penalties, exposure to significant liability, adverse regulatory consequences, and reputational harm, which would materially adversely affect our business, results of operations, and financial condition.” GOVERNMENT REGULATION General Our operations are subject to comprehensive and detailed federal, state, and local laws and regulations throughout the jurisdictions in which we do business.
“Risk Factors—Risks Related to our Business—If we are unable to integrate and manage our information systems effectively, our operations could be disrupted” and “Risk Factors—Risks Related to our Business—If we or our partners or other third parties with whom we collaborate fail to protect confidential information and/or sustain a data security incident, we could suffer increased costs, material financial penalties, exposure to significant liability, adverse regulatory consequences, and reputational harm, which would materially adversely affect our business, results of operations, and financial condition.” GOVERNMENT REGULATION General Our operations are subject to comprehensive and detailed federal, state, and local laws and regulations throughout the jurisdictions in which we do business.
Fraud, waste, and abuse prohibitions encompass a wide range of activities, including, but not limited to, kickbacks or other inducements for referral of members or for the coverage of products (such as prescription drugs) by a plan, billing for unnecessary medical services by a healthcare provider, payments made to excluded providers, and improper marketing and beneficiary inducements.
Fraud, waste, and abuse prohibitions encompass a wide range of activities, including, but not limited to, kickbacks or other inducements for referral of members or for the coverage of products (such as prescription drugs) by a plan, billing for unnecessary medical services by a healthcare provider, payments made to excluded providers, improper enrollments or manipulative practices and improper marketing and beneficiary inducements.
The American Rescue Plan Act (“ARPA”) increased the size of APTCs for individuals and families at every income level during 2021 and 2022, and the Inflation Reduction Act of 2022 renewed the enhanced APTCs for three years through the end of 2025.
The American Rescue Plan Act (“ARPA”) increased the size of APTCs for individuals and families at every income level during 2021 and 2022, and the Inflation Reduction Act of 2022 renewed the eAPTCs for three years through the end of 2025.
Our principal competitors in the individual market primarily consist of plans offered by national carriers, regional carriers, Medicaid-focused insurers offering Health Insurance Marketplace products, and local Blue Cross plans .
Our principal competitors in the individual market primarily consist of plans offered by national carriers, regional carriers, Medicaid-focused insurers offering Health Insurance Marketplaces products, and local Blue Cross plans .
Further, the ACA implemented certain requirements for insurers, including the minimum MLR provision that requires insurers to pay rebates to members when insurers do not meet or exceed the specified annual MLR thresholds and requirements related to the quality, credentialing, availability and accessibility of contracted providers participating in our healthcare professional networks.
Further, the ACA includes requirements for insurers, including the minimum MLR provision that requires insurers to pay rebates to members when insurers do not meet or exceed the specified annual MLR thresholds and requirements related to the quality, credentialing, availability and accessibility of contracted providers participating in our healthcare professional networks.
For information on risks associated with our intellectual property rights, see “Risk Factors—Risks Related to our Business—Failure to secure, protect, or enforce our intellectual property rights could harm our business, results of operations, and financial condition.” INFORMATION TECHNOLOGY Our business is dependent on effective, resilient, and secure information systems that assist us in, among other things, monitoring utilization and other cost factors, processing provider claims, providing data to our regulators, and implementing our data security measures.
“Risk Factors—Risks Related to our Business—Failure to secure, protect, or enforce our intellectual property rights could harm our business, results of operations, and financial condition.” INFORMATION TECHNOLOGY Our business is dependent on effective, resilient, and secure information systems that assist us in, among other things, monitoring utilization, and other cost factors, processing provider claims, providing data to our regulators, and implementing our data security measures.
The vast majority of our membership is acquired through the broker channel, and brokers typically use an Enhanced Direct Enrollment (EDE) platform to enroll the members in plans offered on the Health Insurance Marketplace. As such, we compete through the commissions and bonus structures we pay these partners.
The vast majority of our membership is acquired through the broker channel, and brokers typically use an EDE platform to enroll the members in plans offered on the Health Insurance Marketplace. As such, we compete through the commissions and bonus structures we pay these partners.
Owning our platform from end to end offers us greater control over the member experience, engagement, and affordability, and enables us to provide a superior experience for our members and providers. Our technology platform provides members with a simple and intuitive consumer experience that enables them to take control of their healthcare decisions.
Owning our platform from end to end offers us greater control over the member experience, insurance product development, engagement, and affordability, and enables us to provide a superior experience for our members and providers. Our technology platform provides members with a simple and intuitive consumer experience that enables them to take control of their healthcare decisions.
For more information on RBC capital and additional liquidity and capital requirements, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Overview.” Additionally, as a company that directly or indirectly controls insurers, we have an obligation to adopt a formal enterprise risk management (“ERM”) function and file enterprise risk reports on an annual basis.
For more information on RBC capital and additional liquidity and capital requirements, see Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Overview.” Additionally, as a company that directly or indirectly controls insurers, we have an obligation to adopt a formal enterprise risk management (“ERM”) function and file enterprise risk reports on an annual basis.
Our reinsurance is contracted under two different types of arrangements: quota share reinsurance contracts and excess of loss (“XOL”) reinsurance contracts. In quota share reinsurance, the reinsurer agrees to assume a specified percentage of the ceding company’s losses in exchange for a corresponding percentage of premiums.
Our reinsurance agreements are contracted under two different types of arrangements: quota share reinsurance contracts and excess of loss (“XOL”) reinsurance contracts. In quota share reinsurance, the reinsurer agrees to assume a specified percentage of the ceding company’s losses in exchange for a corresponding percentage of premiums.
CMS has recently been increasingly focused on improving integrity in the eligibility and enrollment process and preventing unauthorized changes in consumer enrollments by agents and brokers, and we expect this focus to continue.
CMS has recently been increasingly focused on improving integrity in the eligibility and enrollment process and preventing unauthorized changes in consumer enrollments in the Health Insurance Marketplaces by agents and brokers, and we expect this focus to continue.
Similarly, in accordance with The National Association of Insurance Commissioners’ (“NAIC”) Risk Management and Own Risk Solvency Assessment Model Act, we must complete an annual “own risk and solvency assessment,” which is an internal assessment, appropriate to the nature, scale, and complexity of our company, of the material and relevant risks associated with the current business plan, and of the sufficiency of capital resources to support those risks. 14 Table of Contents Ongoing Requirements and Changes to the ACA The ACA significantly changed the United States healthcare system.
Similarly, in accordance with the NAIC Risk Management and Own Risk Solvency Assessment Model Act, we must complete an annual “own risk and solvency assessment,” which is an internal assessment, appropriate to the nature, scale, and complexity of our company, of the material and relevant risks associated with the current business plan, and of the sufficiency of capital resources to support those risks. 14 Table of Contents Ongoing Requirements and Changes to the ACA The ACA significantly changed the United States healthcare system.
Qui tam actions have increased significantly in recent years, causing greater numbers of healthcare companies to have to defend a false claim action, pay substantial settlement amounts, and/or enter into a CIA and/or other heightened monitoring arrangements to avoid exclusion from government healthcare programs as a result of an investigation arising out of such action.
Qui tam actions have increased significantly in recent years, causing greater numbers of healthcare companies to have to defend a false claim action, pay substantial settlement amounts, and/or enter into a CIA and/or other heightened monitoring arrangements to avoid exclusion from government healthcare programs as a result of an investigation arising out of such action. See Part I, Item 1A.
We’re solving problems that change and save lives. 2. Powered by people. Members above all. Developing and growing others is what raises the bar. 3. No genius without grit. Be relentless. Be scrappy. Trying and failing beats not trying and changing nothing. 4. Seek the truth. But never assume you’ve found it. Be scientific. 9 Table of Contents 5.
We’re solving problems that change and save lives. 2. Powered by people. Members above all. Developing and growing others is what raises the bar. 3. No genius without grit. Be relentless. Be scrappy. Trying and failing beats not trying and changing nothing. 4. Seek the truth. But never assume you’ve found it. Be scientific. 5. Inspire and provoke.
Most states have adopted these or similar measures to expand the scope of regulations relating to corporate governance and internal control activities of HMOs and insurance companies. Health insurers and HMOs are subject to state examination and periodic regulatory approval renewal proceedings.
Most states have adopted these or similar measures to expand the scope of regulations relating to corporate governance and internal control activities of Health Insurance Entities. Health Insurance Entities are subject to state examination and periodic regulatory approval renewal proceedings.
We have been challenging the status quo in the healthcare system since our founding in 2012 and are dedicated to making a healthier life accessible and affordable for all. Our technology drives superior experiences, deep engagement, and high-value clinical care, earning us the trust of approximately 1.68 million effectuated members, as of December 31, 2024.
We have been challenging the status quo in the healthcare system since our founding in 2012 and are dedicated to making a healthier life accessible and affordable for all. Our technology drives superior experiences, deep engagement, and high-value clinical care, earning us the trust of approximately 2.0 million effectuated members, as of December 31, 2025.
Oscar has exclusive provider organization (“EPO”) plans in most of our markets, and also offers health maintenance organization (“HMO”) plans in select markets. We work with technology-forward, high brand-recognition health systems, including some of the largest health systems in the U.S.
Oscar has exclusive provider organization plans in most of our markets, and also offers HMO plans in select markets. We work with technology-forward, high brand-recognition health systems, including some of the largest health systems in the U.S.
Dispositions of control generally are also regulated under applicable state insurance holding company laws. The states of domicile of our health insurance subsidiaries have statutory risk-based capital (“RBC”) requirements for insurance companies and HMOs.
Dispositions of control generally are also regulated under applicable state insurance holding company laws. The states of domicile of our Health Insurance Subsidiaries have statutory risk-based capital (“RBC”) requirements for Health Insurance Entities.
The California Consumer Privacy Act of 2018 (“CCPA”) and the California Privacy Rights Act of 2023 (“CPRA”) began a trend toward more stringent privacy legislation in the United States, and multiple states have enacted, or are expected to enact, similar laws, including the Oregon Consumer Privacy Law which took effect on July 1, 2024, not all of which exempt insurance companies categorically.
The California Consumer Privacy Act of 2018 (“CCPA”) and the California Privacy Rights Act of 2023 (“CPRA”) began a trend toward more stringent privacy legislation in the United States, and multiple states have enacted, or are expected to enact, similar laws, including the Oregon Consumer Privacy Law which took effect on July 1, 2024, and the Minnesota Consumer Data Privacy Act which took effect on July 31, 2025, not all of which exempt Health Insurance Entities categorically.
Enterprise marketing and sales strategies also include account-based marketing, business development initiatives, member communications that are focused on member acquisition, and member engagement.
Enterprise marketing and sales strategies also include brand awareness campaigns, account-based marketing, business development initiatives, member communications that are focused on member acquisition, and member engagement.
We believe that having a varied and broad employee base empowers our community, drives better business outcomes, and ultimately allows us to better serve our members. Internally, we aim to promote a transparent, systematic approach to our human capital frameworks and operations.
Building Community We believe that having a varied and broad employee base empowers our community, drives better business outcomes, and ultimately allows us to better serve our members. 10 Table of Contents Internally, we aim to promote a transparent, systematic approach to our human capital frameworks and operations.
Some states permit insurers or HMOs to recover assessments paid through full or partial premium tax offsets, or through future policyholder surcharges. The amount and timing of any future assessments cannot be predicted with certainty; however, future assessments may occur.
Some states permit Health Insurance Entities to recover assessments paid through full or partial premium tax offsets, or through future policyholder surcharges. The amount and timing of any future assessments cannot be predicted with certainty; however, future assessments may occur.
Our Offerings Oscar’s innovative technology-enabled model - made up of Oscar’s insurance business and +Oscar - is uniquely positioned to meet the rising expectations of individuals, families, and employees, as well as +Oscar clients. Oscar's business is built upon our focus on member experience and our cloud-native technology platform.
Our Offerings Oscar’s innovative technology-enabled model - made up of Oscar’s insurance business, +Oscar platform, and brokerage services, and enrollment platform - is uniquely positioned to meet the rising expectations of individuals, families, brokers, employers and employees, as well as +Oscar clients. Oscar's insurance business is built on our cloud-native technology platform and our focus on member experience.
For information on risks associated with our regulatory framework, see “Risk Factors—Most Material Risks to Us—Any changes to the ACA and its regulations could materially and adversely affect our business, results of operations, and financial condition; and Risk Factors—Risks Related to the Regulatory Framework that Governs Us.” Supervisory agencies, including federal and state regulatory and enforcement authorities, have broad authority to: • grant, suspend, deny, and revoke certificates of authority to transact insurance; • regulate our products and services; • regulate, limit, or suspend our ability to market products, including the exclusion of our products from Health Insurance Marketplaces; • monitor our network of contracted providers to ensure we meet specific state and/or federal quality, credentialing, availability and accessibility requirements on an ongoing basis and require regulatory assessment and approval annually as a condition of offering our products; • approve premium rates; • monitor our solvency and reserve adequacy; • scrutinize our investment activities on the basis of quality, diversification, and other quantitative criteria; and • impose criminal, civil, or administrative monetary penalties, and other sanctions for non-compliance with regulatory requirements.
“Risk Factors—Most Material Risks to Us—Any changes to the ACA and its regulations could materially and adversely affect our business, results of operations, and financial condition” and “Risk Factors—Risks Related to the Regulatory Framework that Governs Us.” Supervisory agencies, including federal and state regulatory and enforcement authorities, have broad authority to: • grant, suspend, deny, and revoke certificates of authority to transact insurance or licenses to operate as an agency or producer; • regulate our products and services; • regulate, limit, or suspend our ability to market and sell products, including the exclusion of our products from Health Insurance Marketplaces, and regulate any applicable commission structures; • monitor our network of contracted providers to ensure we meet specific state and/or federal quality, adequacy, credentialing, availability and accessibility requirements on an ongoing basis and require regulatory assessment and approval annually as a condition of offering our products; • approve premium rates; • monitor our solvency and reserve adequacy; • scrutinize our investment activities on the basis of quality, diversification, and other quantitative criteria; • monitor adherence to EDE technical, operational, and monitoring requirements; and • impose criminal, civil, or administrative monetary penalties, and other sanctions for non-compliance with regulatory requirements.
Individuals and families may also purchase policies in the individual market off-exchange. Employees whose employers have chosen to offer an Individual Coverage Health Reimbursement Arrangement (“ICHRA”) are also able to purchase Oscar’s health plans. Most ICHRA plans are purchased by employees off-exchange, although they may also be purchased through the Health Insurance Marketplace.
Individuals and families may also purchase policies in the individual market off-exchange. Employees whose employers have chosen to offer an ICHRA are also able to purchase Oscar’s health plans. Most ICHRA plans are purchased by employees off-exchange, although they may also be purchased through the Health Insurance Marketplaces.
Most of our subsidiaries are subject to requirements based on the Risk-Based Capital For Health Organizations Model Act, with a few subsidiaries subject to state-specific RBC requirements that are not based on, but function similarly to, the Model Act.
Most of our Health Insurance Subsidiaries are subject to requirements based on the National Association of Insurance Commissioners’ (“NAIC”) Risk-Based Capital For Health Organizations Model Act, with a few Health Insurance Subsidiaries subject to state-specific RBC requirements that are not based on, but function similarly to, the Model Act.
Risk adjustment is defined as provided in “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Recent Developments, Trends and Other Key Factors Impacting Performance—Risk Adjustment”. 5 Table of Contents +Oscar Platform Oscar’s success is built upon our superior member engagement and robust technology platform.
Risk adjustment is defined as provided in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Recent Developments, Trends and Other Key Factors Impacting Performance—Risk Adjustment” . +Oscar Platform Oscar’s success is built upon our superior member engagement and robust technology platform.
These prohibitions may be statutory or regulatory, or may be imposed through judicial or regulatory interpretation. The laws, regulations and interpretations in certain states have been subject to limited judicial and regulatory interpretation and are subject to change.
These prohibitions may be statutory or regulatory, or may be imposed through judicial or regulatory interpretation. The laws, regulations and interpretations in certain states have been subject to limited judicial and regulatory interpretation and are subject to change. See Part I, Item 1A.
These laws typically require increasing degrees of regulatory oversight and intervention if a company’s RBC declines below certain thresholds. As of December 31, 2024, the RBC levels of our insurance and HMO subsidiaries expect to meet or exceed all applicable mandatory RBC requirements.
These laws typically require increasing degrees of regulatory oversight and intervention if a company’s RBC declines below certain thresholds. As of December 31, 2025, the RBC levels of our Health Insurance Subsidiaries are expected to meet or exceed all applicable mandatory RBC requirements.
The proposed rule would modify the HIPAA Security Rule to require health plans and payers (insurance companies), and most health care providers, and their business associates, to strengthen cybersecurity protections for individuals’ protected health information.
The proposed rule would modify the HIPAA Security Rule to require health plans and payers (Health Insurance Entities), and most health care providers, and their business associates, to strengthen cybersecurity protections for individuals’ PHI.
Concentration We generate the vast majority of our total revenue from health insurance policy premiums. Premiums are collected directly from the Centers for Medicare & Medicaid Services (“CMS”) as part of the advanced premium tax credits (“APTC”) program, as well as from our members.
We have expanded our offerings to 20 states for 2026. Concentration We generate the vast majority of our total revenue from health insurance policy premiums. Premiums are collected directly from the Centers for Medicare & Medicaid Services (“CMS”) as part of the advanced premium tax credits (“APTC”) program, as well as from our members.
In addition, the Health Information Technology for Economic and Clinical Health Act of 2009 and corresponding implementing regulations have imposed additional requirements on the use and disclosure of PHI such as additional breach notification and reporting requirements, contracting requirements for HIPAA business associate agreements, and strengthened enforcement mechanisms and increased penalties for HIPAA violations.
In addition, HIPAA and corresponding implementing regulations have imposed additional requirements on the use and disclosure of PHI such as additional breach notification and reporting requirements, contracting requirements for HIPAA business associate agreements, and strengthened enforcement mechanisms and increased penalties for HIPAA violations.
Item 1. Business OUR BUSINESS Oscar is a leading healthcare technology company built around a full stack technology platform and a relentless focus on member experience. We offer health plans through the Patient Protection and Affordable Care Act (“ACA”) serving individuals, families, and employees.
Item 1. Business OUR BUSINESS Oscar is a leading healthcare technology company built around a full stack technology platform and a relentless focus on member experience. We offer health plans through the ACA serving individuals, families, and employees.
Additionally, in 2017 the National Association of 17 Table of Contents Insurance Commissioners (“NAIC”) adopted the Insurance Data Security Model Law, which established standards for data security and for the investigation and notification of insurance commissioners of cybersecurity events involving unauthorized access to, or the misuse of, certain nonpublic information.
Additionally, in 2017 the NAIC adopted the Insurance Data Security Model Law, which established standards for data security and for the investigation and notification of insurance commissioners of cybersecurity events involving unauthorized access to, or the misuse of, certain nonpublic information.
Most states require holders of personal information to maintain safeguards and take certain actions in response to a data breach, such as maintaining reasonable security measures and providing prompt notification of the breach to affected individuals and the state’s attorney general.
Most states require holders of personal information to maintain safeguards and take certain actions in response to a data breach, such as maintaining reasonable security measures and providing prompt notification of the breach to affected individuals and the state’s attorney general. For further discussion, see Part I, Item 1A.
For information on risks associated with ACA and changes to ACA, see “Risk Factors—Most Material Risks to Us—Any potential repeal of, changes to, or judicial challenges to the ACA and its regulations, could materially and adversely affect our business, results of operations, and financial condition.” In general, the individual market risk pool that includes Health Insurance Marketplaces has changed significantly since its inception in 2014 and continues to exhibit risk volatility.
“Risk Factors—Most Material Risks to Us—Any changes to the ACA and its regulations could materially and adversely affect our business, results of operations, and financial condition.” In general, the individual market risk pool that includes Health Insurance Marketplaces has changed significantly since its inception in 2014 and continues to exhibit risk volatility.
These laws and other laws that govern operations of insurance companies and HMOs contain certain reporting requirements, as well as restrictions on transactions between an insurer or HMO and its affiliates, and may restrict the ability of our health insurance subsidiaries to pay dividends to our holding companies.
These laws and other laws that govern operations of Health Insurance Entities contain certain reporting requirements, as well as restrictions on transactions between a Health Insurance Entity and its affiliates, and may restrict the ability of our Health Insurance Subsidiaries to pay dividends to our holding companies.
These RBC requirements are intended to assess the capital adequacy of life and health insurers and HMOs, taking into account the risk characteristics of a company’s investments and products. In general, under these laws, an insurance company or HMO must submit a report of its RBC level to the insurance regulator of its state of domicile.
These RBC requirements are intended to assess the capital adequacy of Health Insurance Entities, taking into account the risk characteristics of a company’s investments and products. In general, under these laws, a Health Insurance Entity must submit a report of its RBC level to the insurance regulator of its state of domicile.
We believe our compensation philosophy and practice, which is rooted in data and benchmarked to a cohort of technology, healthcare, operations, and insurance peer companies, is transparent, systematic, and equitable.
We believe our compensation philosophy and practice, which is rooted in data and benchmarked to a cohort of peer and broader industry companies, is transparent, systematic, and equitable.
As of December 31, 2024, we owned no issued patents or pending patent applications anywhere in the world, and therefore, we do not have patent protection for any of our proprietary technology, which includes our full stack technology platform, proprietary software, mobile application (“app”), or web portal. However, our software and other proprietary information are protected by copyright on creation.
As of December 31, 2025, we owned no issued patents or pending patent applications anywhere in the world, and therefore, we do not have patent protection for any of our proprietary technology, which includes our full stack technology platform, proprietary software, mobile application (“app”), or web portal.
In addition, the CMS and the HHS Office of Inspector General (“HHS-OIG”) perform risk adjustment data valuation (“RADV”) audits of health insurance plans to validate the coding practices of and supporting documentation maintained by healthcare providers, and such audits can result in adjustments to risk transfer payments. • CMS has oversight of agents, brokers, and enhanced direct enrollment entities, all of whom facilitate member enrollments in coverage in the individual market.
In addition, the CMS and the HHS Office of Inspector General (“HHS-OIG”) perform risk adjustment data valuation (“RADV”) audits of health insurance plans, sometimes years after the applicable payment year, to validate the coding practices of and supporting documentation maintained by healthcare providers, and such audits can result in retrospective adjustments to risk transfer payments. • CMS has oversight of agents, brokers, and EDE entities, all of whom facilitate member enrollments in coverage in the Health Insurance Marketplaces.
Applicable state insurance holding company acts also restrict the ability of any person to obtain control of an insurance company or HMO without prior regulatory approval.
Applicable state insurance holding company acts also restrict the ability of any person to obtain control of a Health Insurance Entity without prior regulatory approval.
Our products help remove financial barriers to high-value services, with a focus on leveraging affordable care, clinical strategies, and our innovative business model, which collectively, empower and incentivize our members to have better control of their health. Some of our products incorporate benefits and programs of particular value to members with complex conditions, such as diabetes and asthma.
Our products help remove financial barriers to high-value services, with a focus on leveraging affordable care, clinical strategies, and our innovative business model, which collectively empower and incentivize our members to have better control of their health.
We announce material information to the public about us, our products and services, and other matters through a variety of means, including filings with the SEC, press releases, public conference calls, webcasts and the investor relations section of our website in order to achieve broad, non-exclusionary distribution of information to the public and for complying with our disclosure obligation under Regulation FD. 19 Table of Contents The information disclosed by the foregoing channels could be deemed to be material information.
We announce material information to the public about us, our products and services, and other matters through a variety of means, including filings with the SEC, press releases, public conference calls, webcasts and the investor relations section of our website in order to achieve broad, non-exclusionary distribution of information to the public and to comply with our disclosure obligation under Regulation Fair Disclosure.
In addition, the ACA required a number of other changes with significant effects on both federal and state health insurance markets, including strict rules on how health insurance is rated, what benefits must be offered, the assessment of new taxes and fees, the creation of public Health Insurance Marketplaces for individuals and small employer group health insurance and the availability of premium subsidies for qualified individuals.
In addition, the ACA includes a combination of federal and state oversight and strict rules on how health insurance is rated, what benefits must be offered, the assessment of new taxes and fees, the creation of public Health Insurance Marketplaces for individuals and small employer group health insurance and the availability of premium subsidies for qualified individuals.
Some of the more significant ACA rules are described below: 15 Table of Contents • The minimum MLR threshold for the individual market, as defined by U.S. Department of Health and Human Services (“HHS”), is 80%. Certain states require us to meet more restrictive MLR thresholds.
Some of the more significant ACA rules are described below: • The minimum MLR threshold for the individual market, as defined by the U.S. Department of Health and Human Services (“HHS”), is 80%. Certain states require us to meet more restrictive MLR thresholds. For example, New York state law requires an 82% MLR for individual products and plans.
See “Risk Factors—Risks Related to the Regulatory Framework that Governs Us—We are subject to extensive fraud, waste, and abuse laws that may require us to take remedial measures or give rise to lawsuits and claims against us, the outcome of which may have a material adverse effect on our business, financial condition, cash flows, or results of operations.” Further, analogous state laws and regulations, such as state anti-kickback and false claims laws, which may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by non-governmental third-party payors, including private insurers, may be broader in scope than their federal equivalents; state insurance laws require insurance companies to comply with state regulations.
“Risk Factors—Risks Related to the Regulatory Framework that Governs Us—We are subject to extensive fraud, waste, and abuse laws that may require us to take remedial measures or give rise to lawsuits, audits, investigations and claims against us, the outcome of which may have a material adverse effect on our business, financial condition, cash flows, or results of operations.” Further, analogous state laws and regulations, such as state anti-kickback and false claims laws, which may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by non-governmental third-party payors, including private insurers, may be broader in scope than their federal equivalents; state insurance laws require Health Insurance Entities, as well as health insurance agencies and EDE entities, to comply with state regulations. 19 Table of Contents Guaranty Fund Assessments Under certain state insolvency or guaranty association laws, Health Insurance Entities can be assessed for amounts paid by guaranty funds for policyholder losses incurred when a Health Insurance Entity becomes insolvent.
Our medical and pharmacy costs can also exhibit seasonality depending on selection effects or changes in the risk profile of our membership and the proportion of our membership that is new in the calendar year.
Our medical expenses are also impacted by the number of days and holidays in a given period. Our medical and pharmacy costs can also exhibit seasonality depending on selection effects or changes in the risk profile of our membership and the proportion of our membership that is new in the calendar year.
Privacy, Confidentiality and Data Standards Regulation The Health Insurance Portability and Accountability Act of 1996, as amended by the Health Information Technology for Economic and Clinical Health Act of 2009 (together, “HIPAA”) and the administrative simplification provisions of HIPAA impose a number of requirements on covered entities (including health insurers, HMOs, group health plans, certain providers, and clearinghouses) and their business associates relating to the use, disclosure and safeguarding of PHI.
“Risk Factors-Any changes to the ACA and its regulations could materially and adversely affect our business, results of operations, and financial condition.” Privacy, Confidentiality and Data Standards Regulation The Health Insurance Portability and Accountability Act of 1996, as amended by the Health Information Technology for Economic and Clinical Health Act of 2009 (together, “HIPAA”) and the administrative simplification provisions of HIPAA impose a number of requirements on covered entities (including Health Insurance Entities group health plans, certain providers, and clearinghouses) and their business associates relating to the use, disclosure and safeguarding of PHI.
Changes to our business environment are likely to continue as elected officials at the national and state levels continue to enact, and both elected officials and candidates for election continue to propose significant modifications to existing laws and regulations.
Changes to our business environment are likely to continue as elected officials at the national and state levels continue to enact, and both elected officials and candidates for election continue to propose significant modifications to existing laws and regulations. For information on risks associated with ACA and changes to ACA, see Part I, Item 1A.
As a greater proportion of enrollment in the Health Insurance Marketplace comes through independent brokers, the amount of compensation paid to these third parties impacts both our ability to retain our current members and obtain new members.
As a greater proportion of enrollment in the Health Insurance Marketplaces comes through independent brokers, the amount of compensation paid to these third parties impacts both our ability to retain our current members and obtain new members. Our digital engagement platform, a key element of our retention strategy, is used by brokers and consumers.
For the year ended December 31, 2024, $9,512.3 million and $799.3 million of premiums were earned directly from CMS and from our members, respectively. 6 Table of Contents Disaggregated membership information as of December 31, 2024 and 2023 is presented in the tables below: Membership by Offering As of December 31, 2024 2023 Individual and Small Group 1,636,400 967,002 Medicare Advantage — 1,781 Cigna+Oscar (1) 40,570 67,500 Total Members (2) 1,676,970 1,036,283 (1) Represents total membership for our co-branded partnership with Cigna.
For the year ended December 31, 2025, 93% of premiums were earned directly from CMS and 7% were from our members. 6 Table of Contents Disaggregated membership information as of December 31, 2025 and 2024 is presented in the tables below: Membership by Offering As of December 31, 2025 2024 Individual and Small Group 2,042,449 1,636,400 Cigna+Oscar (1) — 40,570 Total Members (2) 2,042,449 1,676,970 (1) Represents total membership for our co-branded partnership with Cigna.
This makes our operations vulnerable to adverse effects if such third parties fail to perform adequately. We have entered into agreements with third-party vendors who manage certain of our information technology infrastructure services including, among other things, our information technology operations, end-user services, and platforms for cloud computing.
We have entered into agreements with third-party vendors who manage certain elements of our information technology infrastructure services including, among other things, our information technology operations, end-user services, and platforms for cloud computing.
MLR is defined as provided in “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Components of our Results of Operations—Medical Loss Ratio”. We elect to participate in a given individual market on an annual basis.
Additionally, various federal and state laws have minimum Medical Loss Ratio (“MLR”) requirements. MLR is defined as provided in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Components of our Results of Operations—Medical Loss Ratio” . We elect to participate in a given individual market on an annual basis.
Claims Incurred Our medical expenses are impacted by seasonal effects of medical costs such as the utilization of deductibles and out-of-pocket maximums over the course of the policy year, which shifts more costs to us in the second half of the year as we pay a higher proportion of covered claims costs, and the number of days and holidays in a given period.
Claims Incurred Our medical expenses are impacted by seasonal effects on medical costs, as members pay their contractual portion of claims responsibility, meeting their deductibles and out-of-pocket maximums over the course of the policy year, which shift more costs to us in the second half of the year as we pay a higher proportion of covered claims costs.
Fraud, Waste and Abuse Laws and the False Claims Act Because we receive payments from federal governmental agencies, we may be subject to various laws commonly referred to as “fraud, waste, and abuse” laws, including the federal Anti-Kickback Statute, the Physician Self-Referral Law (“Stark Law”), and the FCA.
Our business and operations are also subject to federal, state, and local consumer protection laws governing the use of email and telephone marketing. 18 Table of Contents Fraud, Waste and Abuse Laws and the False Claims Act Because we receive payments from federal governmental agencies, we may be subject to various laws commonly referred to as “fraud, waste, and abuse” laws, including the federal Anti-Kickback Statute, the Physician Self-Referral Law (“Stark Law”), and the FCA.
The NBPP for plan year 2025 was released on April 15, 2024, and the NBPP for plan year 2026 was issued on January 13, 2025. CMS limits the number of non-standard plan options that QHP issuers may offer on the federal ACA marketplace to two per product network type, per metal level (excluding catastrophic plans).
In the NBPP for policy year 2024, CMS imposed a limit of four non-standardized plan options on the federal marketplace and in the NBPP for policy year 2025, CMS limited the number of non-standard plan options that QHP issuers may offer on the federal ACA marketplace to two per product network type, per metal level (excluding catastrophic plans).
As such, we encourage investors, the media, and others to follow the channels listed above and to review the information disclosed through such channels. Any updates to the list of disclosure channels through which we will announce information will be posted on the “Investor Relations” section of our website.
Any updates to the list of disclosure channels through which we will announce information will be posted on the “Investor Relations” section of our website.
CMS has created an exceptions process for plans offered beyond the limit of two non-standardized plans if they provide twenty five percent reduced cost-sharing for chronic and high-cost condition benefits. This exceptions process provides a limited opportunity for innovation for products designed to serve members with chronic and high-cost condition benefits.
The rule also created an exceptions process for plans offered beyond the limit of two non-standardized plans if they provide twenty five percent reduced cost-sharing for chronic and high-cost condition benefits.
Our technology is fueling advancement in member engagement and stakeholder satisfaction by focusing on: • Powering personalized engagement to drive real-time information flow based on cultural preferences and individual health needs to reduce member friction and improve retention. • Improving navigation by making it easier for members to receive high-value clinical care through enhanced digital tools and process automation. • Solving key pain points that unburden providers by reducing administrative tasks, deepening network relationships, and enabling better care delivery for our members (e.g., digitizing provider-member interactions and automating clinical and administrative workflows).
Our technology is fueling advancement in member engagement and stakeholder satisfaction by focusing on: • Powering personalized engagement to drive real-time information flow based on cultural preferences and individual health needs to reduce member friction and improve retention. • Leveraging AI enabled member and provider service touch points to provide high quality, impactful services at scale, including chatbots to answer health, wellness and insurance plan questions. • Improving navigation by making it easier for members to receive high-value clinical care through enhanced digital tools and process automation. • Solving key pain points that unburden providers by reducing administrative tasks, deepening network relationships, and enabling better care delivery for our members (e.g., digitizing provider-member interactions and automating clinical and administrative workflows). 8 Table of Contents It is the combination of all these factors—trust, engagement, and personalized insights—that enables us to help members find quality care that helps them live the lives they want to live at rates they can afford.
We offer Campaign Builder, an engagement and recommendation platform that leverages the wisdom from 12+ years of building the Oscar member experience. The platform delivers continuous care management by informing population identification and delivering personalized interactions with real time reporting and analytics to measure key outcomes and insights.
We offer Campaign Builder, an engagement and recommendation platform that leverages the wisdom from 13+ years of building the Oscar member experience. The platform leverages data and AI to identify high value opportunities for engagement and to deliver personalized interactions to improve care with real time reporting and analytics to measure key outcomes and insights.
We have use cases for AI Technologies in the pipeline across all levels of our technology stack, including: (i) automation to drive efficiencies in our administrative functions, including virtual care and claims processing, (ii) member personalization, to improve the quality of touchpoints members have with the healthcare ecosystem; and (iii) medical record extraction, to better understand our members.
We have embedded AI Technologies across many aspects of our technology stack, including: (i) automation to drive efficiencies in our administrative functions, including virtual care and claims processing, (ii) member personalization, to improve the quality of touchpoints members have with the healthcare ecosystem; and (iii) digital self-service and member-facing agent capabilities to facilitate care and improve the member experience.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeNumerous factors impact our ability to accurately estimate and control our medical expenses, many of which are not within our control, including, but not limited to: • the occurrence of natural disasters, terrorism, public health emergencies, major epidemics and pandemics; • changes in healthcare regulations and practices, including subregulatory guidance, regulations, or statutes that govern individual plans, or the Health Insurance Marketplaces; 23 Table of Contents • the impact on market morbidity of ongoing Medicaid redeterminations and the potential elimination of enhanced APTC; • the broader competitive landscape, including new membership resulting from other health insurers exiting our markets, initiation of new SEPs and general expansion of the individual health insurance market; • lack of credible data in new regions or with respect to new plan offerings; • changes in the utilization of prescription drugs, medical services or other covered items or services; • increases in the costs of healthcare facilities and services, medical devices and pharmaceuticals, including due to the introduction and adoption of new or costly medical technologies and pharmaceuticals or as a result of macroeconomic inflationary effects; • changes in our member demographic mix, the geographic concentration of our members, and the distribution of members among our plans; • changes in purchase discounts or pharmacy volume rebates received from drug manufacturers and wholesalers, or the guaranteed minimum discounts or rebates we agree to with the pharmacy benefit manager that negotiates and collects such discounts and rebates on our behalf; • increased incidences or acuity of high dollar claims related to catastrophic illnesses or medical conditions, including claims for which we may not have adequate reinsurance coverage; • changes or reductions of our utilization management functions such as preauthorization of services, concurrent review or requirements for physician referrals; • continued increases in broker fees due to the proportion of broker-acquired business continuing to increase in line with the macro trend in the Health Insurance Marketplace of fewer members signing up directly on exchanges; • provider or broker fraud The Consolidated Appropriations Act of 2023 delinked Medicaid redeterminations from the end of the PHE for COVID-19, and Medicaid redeterminations were required to begin by April 1, 2023.
Biggest changeIn addition, many of the factors listed below may also impact our ability to estimate the future morbidity of the Health Insurance Marketplace: • changes in healthcare regulations and practices, including subregulatory guidance, regulations, or statutes that govern individual plans, or the Health Insurance Marketplaces; • the impact on the morbidity of our members or the broader market member population from ongoing regulatory actions, including actions to improve the integrity in the ACA eligibility and enrollment process (such as the Program Integrity Rules and the OBBBA), the expiration of eAPTCs in 2025, or the potential extension of eAPTCs, in whole or in part, in 2026, if the federal government funds a CSR program, and Medicaid redeterminations; • increases in the costs of healthcare facilities and services, medical devices and supplies, pharmaceutical products and ingredients, including due to the introduction and adoption of new or costly medical technologies and pharmaceuticals, the impact of legislative or regulatory actions, including the imposition of tariffs on certain pharmaceuticals or other foreign imports, or macroeconomic inflationary effects; • the impact on the morbidity of our members or the broader market member population from any shrinkage in the Health Insurance Marketplaces that results from price increases by us or our competitors; • changes in purchase discounts or pharmacy volume rebates received from drug manufacturers and wholesalers, or the guaranteed minimum discounts or rebates we agree to with the pharmacy benefit manager that negotiates and collects such discounts and rebates on our behalf; • continued increases in broker fees due to the proportion of broker-acquired business continuing to increase in line with the macro trend in the Health Insurance Marketplaces of fewer members signing up directly on exchanges; • the broader competitive landscape, including new membership resulting from other Health Insurance Entities exiting our markets, reducing or eliminating plan offerings in our markets, or changing their pricing strategies, initiation of new SEPs and general expansion of the individual health insurance market; • lack of credible data in new regions or with respect to new plan offerings or newly enrolling member populations; • changes in the utilization of prescription drugs, medical services or other covered items or services, including changes in member utilization patterns ahead of potential lapses in coverage due to regulatory change (such as the expiration of the eAPTCs); • changes in our member demographic mix, the geographic concentration of our members, and the distribution of members among our plans; 25 Table of Contents • increased incidences or acuity of high dollar claims related to catastrophic illnesses or medical conditions, including claims for which we may not have adequate reinsurance coverage; • changes to, or reductions of, our utilization management functions, such as preauthorization of services, concurrent review or requirements for physician referrals; • the occurrence of natural disasters, terrorism, public health emergencies, major epidemics and pandemics; and • provider or broker fraud.
The individual and small group markets we serve, and the Medicare Advantage markets we formerly served, employ risk adjustment programs that impact the revenue we recognize for our enrolled membership. We reassess the estimates of the risk adjustment settlements each reporting period and any resulting adjustments are made to premium revenue.
The individual markets we serve, and the small group and Medicare Advantage markets we formerly served, employ risk adjustment programs that impact the revenue we recognize for our enrolled membership. We reassess the estimates of the risk adjustment settlements each reporting period and any resulting adjustments are made to premium revenue.
If regulators do not approve our reinsurance agreements for this purpose, or if we cannot negotiate renewals of our quota share arrangements on acceptable terms, or at all, enter into new agreements with reinsurers, or otherwise obtain capital through debt or equity financings, our capital position would be negatively impacted, and we could fall out of compliance with applicable regulatory requirements.
If regulators do not approve our reinsurance agreements for this purpose, or if we cannot negotiate renewals of our quota share arrangements on acceptable terms, or at all, or enter into new agreements with reinsurers, or otherwise obtain capital through debt or equity financings, our capital position would be negatively impacted, and we could fall out of compliance with applicable regulatory requirements.
For example, one of our vendors in the past experienced a data security incident which required us to devote significant time and resources towards assessing the impact on our operations and member data and to secure alternative vendor relationships, even though the incident was ultimately determined to not directly result in a breach of our members’ data.
For example, one of our vendors in the past experienced a data security incident which required us to devote significant time and resources towards assessing the impact on our operations and member data and to secure alternative vendor relationships, even though the incident was ultimately determined not to directly result in a breach of our members’ data.
We may be unable to anticipate, detect, remediate, recover from future attacks or incidents, resulting in a material and adverse impact to our IT Systems, Confidential Information, or business. Further, we may experience cyber-attacks and other security incidents that remain undetected for an extended period.
We may be unable to anticipate, detect, remediate, or recover from future attacks or incidents, resulting in a material and adverse impact to our IT Systems, Confidential Information, or business. Further, we may experience cyber-attacks and other security incidents that remain undetected for an extended period.
Any compromise or perceived compromise of the security of our IT Systems, Confidential Information or the systems of one or more of our vendors or service providers could cause significant incident response, system restoration or remediation and future compliance costs and it could materially damage our reputation and brand, cause the termination of relationships with our members, result in disruption or interruption to our business operations, marketing partners and carriers, reduce demand for our services, and subject us to significant liability and expense, as well as regulatory investigations and actions, fines and penalties, and lawsuits (such as class actions).
Any compromise or perceived compromise of the security of our IT Systems, Confidential Information or the systems of one or more of our vendors or service providers could cause significant incident response, system restoration or remediation and future compliance costs and could materially damage our reputation and brand, cause the termination of relationships with our members, result in disruption or interruption to our business operations, marketing partners and carriers, reduce demand for our services, and subject us to significant liability and expense, as well as regulatory investigations and actions, fines and penalties, and lawsuits (such as class actions).
Other changes to our government programs could affect our willingness or ability to participate in any of these programs or otherwise have a material adverse effect on our business, operations, cash flows, or earnings.
Other changes to government programs could affect our willingness or ability to participate in any of these programs or otherwise have a material adverse effect on our business, operations, cash flows, or earnings.
In addition, given the costs, effort, and risks of obtaining patent protection, including the requirement to ultimately disclose the invention to the public, we continue not to choose to seek patent protection. Any failure to adequately obtain patent protection, or other intellectual property protection, could later prove to adversely impact our business.
In addition, given the costs, effort, and risks of obtaining patent protection, including the requirement to ultimately disclose the invention to the public, we continue to choose not to seek patent protection. Any failure to adequately obtain patent protection, or other intellectual property protection, could later prove to adversely impact our business.
If we fail to comply with these covenants or to make payments under our indebtedness when due, then we would be in default under that indebtedness, which could, in turn, result in our other indebtedness becoming immediately payable in full.
If we fail to comply with these covenants or make payments under our indebtedness when due, then we would be in default under that indebtedness, which could, in turn, result in our other indebtedness becoming immediately payable in full.
We are also subject to other laws, regulations and industry standards that govern our business practices, including the Telephone Consumer Protection Act (“TCPA”), which restricts the use of automated tools and technologies to communicate with wireless telephone subscribers or communications services consumers generally, the CAN-SPAM Act, which regulates the transmission of marketing emails, and the PSI-DSS, which is a multifaceted security standard that is designed to protect credit card account data as mandated by PCI-DSS entities.
We are also subject to other laws, regulations and industry standards that govern our business practices, including the Telephone Consumer Protection Act (“TCPA”), which restricts the use of automated tools and technologies to communicate with wireless telephone subscribers or communications services consumers generally, the CAN-SPAM Act, which regulates the transmission of marketing emails, and the PCI-DSS, which is a multifaceted security standard that is designed to protect credit card account data as mandated by PCI-DSS entities.
Subject to the satisfaction of vesting conditions, shares issued pursuant to or registered under the registration statement on Form S-8 will be available for resale immediately in the public market without restriction. In addition, upon conversion of the 2031 Notes, we may elect to settle conversions entirely in shares of our Class A common stock.
Subject to the satisfaction of vesting conditions, shares issued pursuant to or registered under a registration statement on Form S-8 will be available for resale immediately in the public market without restriction. In addition, upon conversion of the Notes, we may elect to settle conversions entirely in shares of our Class A common stock.
In the event of any event of default under our Revolving Credit Facility, the applicable lenders or agents could elect to terminate borrowing commitments and declare all borrowings and loans outstanding thereunder, if any, together with accrued and unpaid interest and any fees and other obligations, to be immediately due and payable.
In the event of any event of default under our 2026 Revolving Credit Facility, the applicable lenders or agents could elect to terminate borrowing commitments and declare all borrowings and loans outstanding thereunder, if any, together with accrued and unpaid interest and any fees and other obligations, to be immediately due and payable.
Reductions in the amount of premiums ceded under quota share reinsurance arrangements may result in an increase to our minimum capital and surplus requirements, and an increase in corresponding capital contributions made by Parent to our health insurance subsidiaries or a decrease in funds available for distributions and dividends from our health insurance subsidiaries to Parent.
Reductions in the amount of premiums ceded under quota share reinsurance arrangements may result in an increase to our minimum capital and surplus requirements, and an increase in corresponding capital contributions made by our parent company to our Health Insurance Subsidiaries or a decrease in funds available for distributions and dividends from our Health Insurance Subsidiaries to our parent company.
Unfavorable ratings of the Company or our industry, as well as omission of inclusion of our stock into ESG-oriented investment funds, may lead to negative investor sentiment and the diversion of investment to other companies or industries, which could have a negative impact on our stock price and our access to and cost of capital.
Unfavorable ratings of the Company or our industry, as well as omission of our stock into ESG-oriented investment funds, may lead to negative investor sentiment and the diversion of investment to other companies or industries, which could have a negative impact on our stock price and our access to and cost of capital.
However, each of the professional corporations comprising the Oscar Medical Group is wholly owned by a single physician licensed in California, Florida, New York and New Jersey, who oversees the operation of the Oscar Medical Group in her capacity as president and sole director of each Oscar Medical Group professional corporation.
However, each of the professional corporations comprising the Oscar Medical Group is wholly owned by a single physician licensed in California, Florida, Kansas, New York and New Jersey, who oversees the operation of the Oscar Medical Group in her capacity as president and sole director of each Oscar Medical Group professional corporation.
Changes or developments in the health insurance markets in the United States, including passage and implementation of a law to create a single-payer or government-run health insurance program, could materially and adversely harm our business and operating results.
Changes or developments in the regulation of health insurance markets in the United States, including passage and implementation of a law to create a single-payer or government-run health insurance program, could materially and adversely harm our business and operating results.
The insolvency of one of our partners or providers, including providers with which we have a value-based care arrangement, could expose us to material liabilities. Providers may be unable or unwilling to pay liabilities owed to us under value-based care arrangements.
The insolvency of one or more of our partners or providers, including providers with which we have a value-based care arrangement, could expose us to material liabilities. Providers may be unable or unwilling to pay liabilities owed to us under value-based care arrangements.
We pledged substantially all of our assets as collateral securing our Revolving Credit Facility and any such exercise of remedies on any material portion of such collateral would likely materially adversely affect our business, financial condition or results of operations.
We pledged substantially all of our assets as collateral securing our 2026 Revolving Credit Facility and any such exercise of remedies on any material portion of such collateral would likely materially adversely affect our business, financial condition or results of operations.
As we expand our member base and enter new markets, we are also required to contribute capital to our insurance subsidiaries to fund capital and surplus requirements, escrows, or contingency guaranties, which may, at times, be significant.
As we expand our member base and enter new markets, we are also required to contribute capital to our Health Insurance Subsidiaries to fund capital and surplus requirements, escrows, or contingency guaranties, which may, at times, be significant.
If we are unable to retain highly qualified personnel or hire new employees quickly enough to meet our needs, or otherwise fail to effectively manage our hiring needs or successfully integrate new hires, including our recently hired management team members, our efficiency, ability to execute our growth strategy and our employee morale, productivity, and retention could suffer, which in turn could have an adverse effect on our business, results of operations, and financial condition.
If we are unable to retain highly qualified personnel or hire new employees to meet our needs, or otherwise fail to effectively manage our hiring needs or successfully integrate new hires, including our recently hired management team members, our efficiency, ability to execute our growth strategy and our employee morale, productivity, and retention could suffer, which in turn could have an adverse effect on our business, results of operations, and financial condition.
In December 2020, Congress passed the No Surprises Act, which became effective on January 1, 2022, and requires health insurers to hold members harmless for out-of-network costs in certain circumstances, and requires that insurers and healthcare providers work to agree on out-of-network reimbursement, including through utilizing the independent dispute resolution process outlined in the No Surprises Act or a similar process established under applicable state law.
In December 2020, Congress passed the No Surprises Act, which became effective on January 1, 2022, and requires Health Insurance Entities to hold members harmless for out-of-network costs in certain circumstances, and requires that insurers and healthcare providers work to agree on out-of-network reimbursement, including through utilizing the independent dispute resolution process outlined in the No Surprises Act or a similar process established under applicable state law.
Entities that are found to be in violation of HIPAA as the result of a breach of unsecured PHI or following a complaint about privacy practices or an audit by the HHS, may be subject to significant civil, criminal and administrative fines and penalties and/or additional reporting and oversight obligations if required to enter into a resolution agreement and corrective action plan with HHS to settle allegations of HIPAA non-compliance.
Entities that are found to be in violation of HIPAA as the result of a breach of unsecured PHI or following a complaint about privacy practices or an audit by the OCR, may be subject to significant civil, criminal and administrative fines and penalties and/or additional reporting and oversight obligations if required to enter into a resolution agreement and corrective action plan with OCR to settle allegations of HIPAA non-compliance.
Thrive Capital or one of its affiliates may also pursue acquisition opportunities that may be complementary to our business, and, as a result, those acquisition opportunities may not be available to us.
Thrive Capital or one or more of its affiliates may also pursue acquisition opportunities that may be complementary to our business, and, as a result, those acquisition opportunities may not be available to us.
Our ability to continue to leverage AI Technologies is dependent on access to specific third-party software and infrastructure provided by a handful of vendors with the leading AI Technologies.
Our ability to continue to leverage AI Technologies is dependent on access to specific third-party software and infrastructure provided by a handful of vendors with leading AI Technologies.
In addition, or in the alternative, the applicable lenders or agents could exercise their rights under the security documents entered into in connection with our Revolving Credit Facility.
In addition, or in the alternative, the applicable lenders or agents could exercise their rights under the security documents entered into in connection with our 2026 Revolving Credit Facility.
In addition to state corporate law limitations, these subsidiaries are subject to more stringent laws, regulations and consent orders that may restrict the ability to pay or limit the amount of dividends and distributions that can be paid to us without prior approval of, or notification to, state regulators, including mandatory statutory capital and surplus requirements.
In addition to state corporate law limitations, these Health Insurance Subsidiaries are subject to more stringent laws, regulations and consent orders that may restrict the ability to pay or limit the amount of dividends and distributions that can be paid to us without prior approval of, or notification to, state regulators, including mandatory statutory capital and surplus requirements.
A breach of any of these covenants, or any other covenant in the documents governing our Revolving Credit Facility, could result in a default or event of default under our Revolving Credit Facility.
A breach of any of these covenants, or any other covenant in the documents governing our 2026 Revolving Credit Facility, could result in a default or event of default under our 2026 Revolving Credit Facility.
The occurrence of any of the events described below could harm our business, operating results, financial condition, liquidity, or prospects, and could cause our actual results to differ materially from historical results and those expressed in forward-looking statements made by us or on our behalf in filings with the SEC, press releases, communications with investors, and oral statements.
The occurrence of any of the events described below could harm our business, operating results, financial condition, liquidity, or prospects, and could cause our actual results to differ materially from historical results and those expressed in forward-looking statements made by us in filings with the SEC, press releases, communications with investors, and oral statements.
HIPAA imposes privacy, security and breach notification obligations on “covered entities,” including certain healthcare providers, health plans and healthcare clearinghouses, and their respective “business associates” that Process individually identifiable health information for or on behalf of a covered entity, as well as their covered subcontractors with respect to safeguarding the privacy, security and transmission of individually identifiable health information.
HIPAA imposes privacy, security and breach notification obligations on “covered entities,” including certain healthcare providers, health plans and healthcare clearinghouses, and their respective “business associates,” that Process individually identifiable health information for or on behalf of a covered entity, as well as their covered subcontractors with respect to safeguarding the privacy, security and transmission of individually identifiable health information.
Moreover, if these vendor and service provider relationships were terminated for any reason, we may not be able to find alternative partners in a timely manner or on acceptable financial terms, and may incur significant costs and/or experience significant disruption to our operations in connection with any such vendor or service provider transition.
Moreover, if these vendor and service provider relationships are terminated for any reason, we may not be able to find alternative partners in a timely manner or on acceptable financial terms, and may incur significant costs and/or experience significant disruption to our operations in connection with any such vendor or service provider transition.
Under these rules, a listed company of which more than 50% of the voting power is held by an individual, group or another company is a “controlled company” and may elect not to comply with certain corporate governance requirements, including: • the requirement that a majority of the board of directors consist of independent directors; • the requirement that our nominating and corporate governance committee be composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; • the requirement that our compensation committee be composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; and • the requirement for an annual performance evaluation of our nominating and corporate governance and compensation committees.
Under these rules, a listed company of which more than 50% of the voting power is held by an individual, group or another company is a “controlled company” and may elect not to comply with certain corporate governance requirements, including: 56 Table of Contents • the requirement that a majority of the board of directors consist of independent directors; • the requirement that our nominating and corporate governance committee be composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; • the requirement that our compensation committee be composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; and • the requirement for an annual performance evaluation of our nominating and corporate governance and compensation committees.
Healthcare accreditation entities, such as the National Committee for Quality Assurance (“NCQA”), evaluate health plans based on various criteria, including effectiveness of care and member satisfaction. Health insurers seeking accreditation from NCQA must pass a rigorous, comprehensive review, and must annually report their performance.
Healthcare accreditation entities, such as the National Committee for Quality Assurance (“NCQA”), evaluate health plans based on various criteria, including effectiveness of care and member satisfaction. Health Insurance Entities seeking accreditation from NCQA must pass a rigorous, comprehensive review, and must annually report their performance.
Noteholders may, subject to certain conditions described in the Indenture governing the 2031 Notes, require us to repurchase their 2031 Notes following a fundamental change at a cash repurchase price generally equal to the principal amount of the 2031 Notes to be repurchased, plus accrued and unpaid interest, if any.
Noteholders may, subject to certain conditions described in the indenture governing the applicable Notes, require us to repurchase their Notes following a fundamental change at a cash repurchase price generally equal to the principal amount of the Notes to be repurchased, plus accrued and unpaid interest, if any.
Additionally, under HIPAA, health insurers and other covered entities are also required to report breaches of PHI to affected individuals without unreasonable delay, not to exceed 60 days following discovery of the breach by a covered entity or its agents.
Additionally, under HIPAA, health plans and other covered entities are also required to report breaches of PHI to affected individuals without unreasonable delay, not to exceed 60 days following discovery of the breach by a covered entity or its agents.
Any such decision also will be subject to compliance with contractual restrictions and covenants in the agreements governing our current indebtedness. In addition, our ability to pay dividends in the future depends on the earnings and distributions of funds from our health insurance subsidiaries.
Any such decision also will be subject to compliance with contractual restrictions and covenants in the agreements governing our current indebtedness. In addition, our ability to pay dividends in the future depends on the earnings and distributions of funds from our subsidiaries.
In addition, we may be subject to prepayment penalties depending on when we repay our future indebtedness, which amounts could be material. 48 Table of Contents We may be unable to raise the funds necessary to repurchase our outstanding 2031 Notes for cash following a fundamental change or on the optional repurchase dates, or to pay any cash amounts due upon conversion, and our other indebtedness may limit our ability to repurchase the 2031 Notes or pay cash upon their conversion.
In addition, we may be subject to prepayment penalties depending on when we repay our future indebtedness, which amounts could be material. 54 Table of Contents We may be unable to raise the funds necessary to repurchase our outstanding Notes for cash following a fundamental change or on the optional repurchase dates, or to pay any cash amounts due upon conversion, and our other indebtedness may limit our ability to repurchase the Notes or pay cash upon their conversion.
In addition, in each of the markets in which we operate, we are regulated by the relevant insurance and/or health and/or human services, or other government departments that oversee the activities of insurance and/or healthcare organizations providing or arranging to provide services to Health Insurance Marketplace enrollees or other beneficiaries.
In addition, in each of the markets in which we operate, we are regulated by the relevant insurance and/or health and/or human services, or other government departments that oversee the activities of insurance and/or healthcare organizations providing or arranging to provide services to Health Insurance Marketplaces’ enrollees or other beneficiaries.
If one of the states in which we operate were to experience a large-scale natural disaster, a significant terrorist attack, or some other large-scale event affecting the health of a large number of our members, our covered medical expenses in that state would rise, which could have a material adverse effect on our business, financial condition, cash flows, or results of operations.
If one of the states in which we operate were to experience a large-scale natural disaster, a significant terrorist attack, or some other large-scale event affecting the health of a large number of our members, 46 Table of Contents our covered medical expenses in that state would rise, which could have a material adverse effect on our business, financial condition, cash flows, or results of operations.
Government enaction of emergency powers in response to these public health crises could also disrupt our business operations, including by restricting pharmaceuticals or other supplies, and could increase the risk of shortages of necessary items or labor.
Government enactment of emergency powers in response to these public health crises could also disrupt our business operations, including by restricting pharmaceuticals or other supplies, and could increase the risk of shortages of necessary items or labor.
Many states have enacted separate legislation addressing balance billing or surprise 27 Table of Contents medical bills. These laws and regulations vary in their approach, resulting in different impacts on the healthcare system as a whole. Our health insurance subsidiaries must also comply with numerous statutes and regulations governing the sale, marketing, and administration of insurance.
Many states have enacted separate legislation addressing balance billing or surprise medical bills. These laws and regulations vary in their approach, resulting in different impacts on the healthcare system as a whole. 31 Table of Contents Our subsidiaries must also comply with numerous statutes and regulations governing the sale, marketing, and/or administration of insurance.
Liability under such statutes and regulations may arise, among other things, if we 30 Table of Contents knew, or it is determined that we should have known, that information we provided to form the basis for a claim for government payment was false or fraudulent, or that we were out of compliance with program requirements considered material to the government’s payment decision.
Liability under such statutes and regulations may arise, among other things, if we knew, or it is determined that we should have known, that information we provided to form the basis for a claim for government payment was false or fraudulent, or that we were out of compliance with program requirements considered material to the government’s payment decision.
Our policies, employee training (including security and privacy awareness training), procedures, and technical safeguards may not prevent all improper access to our IT Systems or Confidential Information by employees, vendors, counterparties, or other third parties.
Our policies, employee training (including security and privacy awareness training), procedures, and technical safeguards may not prevent all improper access to our IT Systems, or improper treatment of our Confidential Information, by employees, vendors, counterparties, or other third parties.
Additional disclosures under the Health Plan Transparency Rule went into effect in 2023 (personalized out-of-pocket cost information and negotiated rates for specified healthcare items and services) and was expanded in 2024 (all items and services).
Additional disclosures under the Health Plan Transparency Rule went into effect in 2023 (personalized out-of-pocket cost information and negotiated rates for specified healthcare items and services) and were expanded in 2024 (all items and services).
Fraud, waste and abuse prohibitions encompass a wide range of activities, including, but not limited to, kickbacks or other inducements for referral of members or for the coverage of products (such as prescription drugs) by a plan, billing for unnecessary medical services by a healthcare provider, payments made to excluded providers, and improper marketing and beneficiary inducements.
Fraud, waste and abuse prohibitions encompass a wide range of activities, including, but not limited to, kickbacks or other inducements for referral of members or for the coverage of products (such as prescription drugs) by a plan, billing for unnecessary medical services by a healthcare provider, payments made to excluded providers, improper enrollments or manipulative practices and improper marketing and beneficiary inducements.
Applicable state insurance laws restrict the ability of such health insurance subsidiaries to declare stockholder dividends and require our health insurance subsidiaries to maintain specified levels of statutory capital and surplus. The Revolving Credit Facility contains restrictions on our ability to pay dividends.
Applicable state insurance laws restrict the ability of our Health Insurance Subsidiaries to declare stockholder dividends and require our Health Insurance Subsidiaries to maintain specified levels of statutory capital and surplus. The 2026 Revolving Credit Facility contains restrictions on our ability to pay dividends.
If we are unable to obtain the approvals or licenses necessary, or otherwise meet regulatory and Health Insurance Marketplace requirements, our results of operations and financial condition could be materially and adversely affected.
If we are unable to obtain the approvals or licenses necessary, or otherwise meet regulatory and Health Insurance Marketplaces’ requirements, our results of operations and financial condition could be materially and adversely affected.
These include hiring additional personnel; continuing to develop our proprietary full stack technology platform, member engagement engine and operations, including by utilizing artificial intelligence and machine learning; acquiring more members; maintaining existing members; investing in partnerships, collaborations and acquisitions; expanding into additional business lines, such as ICHRA; and expanding our +Oscar platform offerings.
These include hiring additional personnel; continuing to develop our proprietary full stack technology platform, member engagement engine and operations, including by utilizing AI and machine learning; acquiring more members; maintaining existing members; investing in partnerships, collaborations and acquisitions; expanding into additional business lines, such as ICHRA; and expanding our +Oscar platform offerings.
We and our vendors are subject to various federal and state laws, regulations, rules, and industry standards and other requirements including those that apply generally to the handling of information about individuals, and those that are specific to certain industries, sectors, contexts, or locations. These laws and regulations include, among others, HIPAA, CCPA and CPRA.
We and our vendors are subject to various federal and state laws, regulations, rules, and industry standards and other requirements including those that apply generally to the handling of information about individuals, and those that are specific to certain industries, sectors, contexts, or locations. These laws and regulations include, among others, HIPAA, the CCPA/CPRA and similar comprehensive state privacy rules.
Risks relating to our IT Systems have generally increased in recent years because of the proliferation of new technologies—including artificial intelligence— and the increased sophistication and activities of perpetrators of cyber-attacks, as well as a result of an increase in work-from-home and hybrid work arrangements and geopolitical events involving high cyber-risk countries.
Risks relating to our IT Systems have generally increased in recent years because of the proliferation of new technologies, including AI, and the increased sophistication and activities of perpetrators of cyber-attacks, as well as a result of an increase in work-from-home and hybrid work arrangements, and geopolitical events involving high cyber-risk countries.
If in the future we decide to file applications to protect our innovations and intellectual property, we do not know whether they would result in the issuance of a patent, or effective copyrights, in our content and proprietary coding, as applicable, or whether the examination process will require us to narrow any proposed patent claims.
If in the future we decide to file patent applications to protect our innovations and proprietary technology, we do not know whether they would result in the issuance of a patent, or effective copyrights, in our content and proprietary coding, as applicable, or whether the examination process will require us to narrow any proposed patent claims.
The insurance laws in most states require regulatory review and approval of a change in control of our domestic insurers. “Control” generally means the possession, direct or indirect, of the power to direct, or cause the direction of, the management and policies of an insurer, whether through the ownership of voting securities, by contract, or otherwise.
The insurance laws in most states require regulatory review and approval of a change in control of our domestic insurers. “Control” generally means the possession, direct or indirect, of the power to direct, or cause the direction of, the 58 Table of Contents management and policies of an insurer, whether through the ownership of voting securities, by contract, or otherwise.
Health plans and providers often seek to resolve these types of allegations through 31 Table of Contents settlement for significant and material amounts, even when they do not acknowledge or admit liability, to avoid the uncertainty of treble damages that may be awarded in litigation proceedings.
Health plans and providers often seek to resolve these types of allegations through settlement for significant and material amounts, even when they do not acknowledge or admit liability, to avoid the uncertainty of treble damages that may be awarded in litigation proceedings.
From time to time, we include state-specific provisions in, or subsequently make state-specific amendments to, our reinsurance agreements to reflect capital reserve credit requirements imposed by particular state regulators, or may need to book additional reserves or liabilities to our insurance company statutory financial statements to address regulatory requirements or standards.
From time to time, we include state-specific provisions in, or subsequently make state-specific amendments to, our reinsurance agreements to reflect capital reserve credit requirements imposed by particular state regulators, or may need to book additional reserves or liabilities to our Health Insurance Entity statutory financial statements to address regulatory requirements or standards.
The ARPA increased the size of APTCs for individuals at every household income level for 2021 and 2022, and the Inflation Reduction Act of 2022 renewed the enhanced APTCs for three years through the end of 2025.
The ARPA increased the size of APTCs for individuals at every household income level for 2021 and 2022, and the Inflation Reduction Act of 2022 renewed the eAPTCs for three years through the end of 2025.
According to CMS, these changes are designed to give insurers more stability and predictability with respect to the RADV program and promote fairness in how health insurers receive adjustments.
According to CMS, these changes are designed to give insurers more stability and predictability with respect to the RADV program and promote fairness in how Health Insurance Entities receive adjustments.
Any harm to our 46 Table of Contents reputation could negatively impact employee engagement and retention, customers’ willingness to do business with us, and investment decisions. At the same time, various stakeholders may have divergent views on ESG practices and the speed of their adoption.
Any harm to our reputation could negatively impact employee engagement and retention, customers’ willingness to do business with us, and investment decisions. At the same time, various stakeholders may have divergent views on ESG practices and the speed of their adoption.
The regulatory framework governing the Processing of certain information, particularly financial and other personal information, is rapidly evolving and is likely to continue to be subject to uncertainty and varying interpretations, including in the context of artificial intelligence where regulators are applying existing frameworks to new technology and innovation.
The regulatory framework governing the Processing of certain information, particularly financial and other personal information, is rapidly evolving and is likely to continue to be subject to uncertainty and varying interpretations, including in the context of AI where regulators are applying existing frameworks to new technology and innovation.
We in turn negotiate amounts we pay directly to CVS/Caremark for the pharmaceuticals, as well as minimum guaranteed rebates that CVS/Caremark pays directly to us. We also contract with Optum to provide us with access to its 36 Table of Contents network of behavioral health providers and manage behavioral health benefits for us.
We in turn negotiate amounts we pay directly to CVS/Caremark for the pharmaceuticals, as well as minimum guaranteed rebates that CVS/Caremark pays directly to us. We also contract with Optum to provide us with access to its network of behavioral health providers and manage behavioral health benefits for us.
CMS has also announced a policy that payment adjustments as a result of RADV audits will not be limited to the specific MA enrollees for which errors are found but may also be extrapolated to the entire MA plan subject to a particular CMS contract.
CMS has also announced a policy that payment adjustments as a result of RADV audits will not be limited to the specific Medicare Advantage enrollees for which errors are found but may also be extrapolated to the entire Medicare Advantage plan subject to a particular CMS contract.
Pursuant to state corporate practice of medicine laws, many states in which we operate through our subsidiaries limit the practice of medicine to licensed individuals or professional organizations owned by licensed individuals, and business corporations generally may not exercise control over the medical decisions of physicians.
Pursuant to state corporate practice of medicine laws, many states in which we operate limit the practice of medicine to licensed individuals or professional organizations owned by licensed individuals, and business corporations generally may not exercise control over the medical decisions of physicians.
Among others, our Amended Charter and Amended Bylaws include the following provisions: • a dual class structure that provides our holders of Class B common stock with the ability to control the outcome of matters requiring stockholder approval; • limitations on convening special stockholder meetings, which could make it difficult for our stockholders to adopt desired governance changes; • advance notice procedures, which apply for stockholders to nominate candidates for election as directors or to bring matters before an annual meeting of stockholders; • a prohibition on stockholder action by written consent, which means that our stockholders will only be able to take action at a meeting of stockholders; • a forum selection clause, which means certain litigation can only be brought in Delaware; • no authorization of cumulative voting, which limits the ability of minority stockholders to elect director candidates; • certain amendments to our certificate of incorporation will require the approval of two-thirds of the then outstanding voting power of our capital stock, voting as a single class; • amendments to our bylaws by our stockholders will require the approval of two-thirds of the then outstanding voting power of our capital stock, voting as a single class; • the authorization of undesignated or “blank check” preferred stock, the terms of which may be established and shares of which may be issued without further action by our stockholders and which may be used to create a “poison pill”; • newly created directorships are filled by a majority of directors then in office; and • the approval of two-thirds of the then outstanding voting power of our capital stock, voting as a single class, is required to remove a director. 52 Table of Contents These provisions, alone or together, could delay or prevent hostile takeovers and changes in control or changes in our management.
Among others, our Amended Charter and Amended Bylaws include the following provisions: • a dual class structure that provides our holders of Class B common stock with the ability to control the outcome of matters requiring stockholder approval; • limitations on convening special stockholder meetings, which could make it difficult for our stockholders to adopt desired governance changes; • advance notice procedures, which apply for stockholders to nominate candidates for election as directors or to bring matters before an annual meeting of stockholders; • a prohibition on stockholder action by written consent, which means that our stockholders will only be able to take action at a meeting of stockholders; • a forum selection clause, which means certain litigation can only be brought in Delaware; • no authorization of cumulative voting, which limits the ability of minority stockholders to elect director candidates; • certain amendments to our certificate of incorporation will require the approval of two-thirds of the then outstanding voting power of our capital stock, voting as a single class; • amendments to our Amended Bylaws by our stockholders will require the approval of two-thirds of the then outstanding voting power of our capital stock, voting as a single class; • the authorization of undesignated or “blank check” preferred stock, the terms of which may be established and shares of which may be issued without further action by our stockholders and which may be used to create a “poison pill”; • newly created directorships are filled by a majority of directors then in office; and • the approval of two-thirds of the then outstanding voting power of our capital stock, voting as a single class, is required to remove a director.
We operate in a highly competitive environment and some of the health insurers with which we compete have greater financial and other resources, offer a broader scope of products, and may be able to price their products more competitively than ours.
We operate in a highly competitive environment and some of the Health Insurance Entities with which we compete have greater financial and other resources, offer a broader scope of products, and may be able to price their products more competitively than ours.
From time to time, we are a defendant in lawsuits and the subject of regulatory actions, and are subject to audits, reviews, assessments and investigations relating to our business, including, without limitation, claims by members alleging failure to provide coverage or to pay for or authorize payment for healthcare, claims related to non-payment or insufficient payments for services by providers, including for alleged failure to properly pay in-network and out-out-network claims, claims under U.S. securities laws, claims related to breach of contract, employment related claims, claims of trademark and other intellectual property infringement or misappropriation, claims alleging bad faith or unfair business practices, challenges to the manner in which the Company processes claims, claims relating to sales, marketing and other business practices, inquiries regarding our submission of risk adjustment data, audits related to our compliance with network adequacy requirements, enforcement actions by state regulatory bodies alleging non-compliance with state law, financial and market conduct examinations by state regulatory bodies, and claims related to the imposition of new taxes, including, but not limited to, claims that may have retroactive application.
From time to time, we are a defendant in lawsuits and the subject of regulatory actions, and are subject to audits, reviews, assessments and investigations relating to our business, including, without limitation, claims by members alleging failure to provide coverage or to pay for or authorize payment for healthcare, claims related to non-payment or insufficient payments for services by providers, including for alleged failure to properly pay in-network and out-of-network claims, claims under U.S. securities laws, claims related to breach of contract, employment related claims, claims of trademark and other intellectual property infringement or misappropriation, claims alleging bad faith or unfair business practices, challenges to the manner in which the Company processes claims, claims relating to sales, marketing and other business practices, inquiries regarding our submission of risk adjustment data, audits related to our compliance with network adequacy requirements, or compliance with Health Insurance Marketplace participation agreements or EDE standards, examinations relating to mental health parity compliance, enforcement actions by state regulatory bodies alleging non-compliance with state law, financial and market conduct examinations by state regulatory bodies, and claims related to the imposition of new taxes, including, but not limited to, claims that may have retroactive application.
The extent of a particular cyber-attack 39 Table of Contents and the steps that we may need to take to investigate the attack may take a significant amount of time and resources before such an investigation could be completed and full and reliable information about the incident is known.
The extent of a particular cyber-attack and the steps that we may need to take to investigate the attack may take a significant amount of time and resources before such an investigation could be completed and full and reliable information about the incident is known.
If the AI Technologies we use are incorrectly designed, if the data sets or models upon which they are based have errors or if we fail to develop and maintain adequate safeguards, the performance of our products, services, and business, as well as our reputation, could suffer or we could incur liability through the violation of laws, or contracts to which we are a party.
If the AI Technologies we use are incorrectly designed, if the data sets or models upon which they are based have errors, or if we fail to develop and maintain adequate safeguards, the performance of our products, services, and business, as well as our reputation, could suffer or we could incur liability through the violation of laws or contracts to which we are a party, or through claims by members or regulators.
Based on a final rule issued by CMS in January 2023, overpayments to MA plans that are identified as a result of RADV audit will be subject to extrapolation for plan year 2018 and any subsequent plan year.
Based on a final rule issued by CMS in January 2023, overpayments to Medicare Advantage plans that are identified as a result of a RADV audit will be subject to extrapolation for plan year 2018 and any subsequent plan year.
As described above, any such decision or action would result in an increase in required capital in our insurance subsidiaries, which may be material. 35 Table of Contents Our reinsurance arrangements also subject us to various obligations, representations, and warranties with respect to the reinsurers. Reinsurance does not relieve us of liability as an insurer.
As described above, any such decision or action would result in an increase in required capital in our Health Insurance Subsidiaries, which may be material. Our reinsurance arrangements also subject us to various obligations, representations, and warranties with respect to the reinsurers. Reinsurance does not relieve us of liability as an insurer.
The states in which we operate that have the largest concentrations of revenues include Florida, Texas and Georgia. Due to the geographic concentration of our business, we are exposed to heightened risks of potential losses resulting from unfavorable changes in the regulatory environment for healthcare, increased competition, and other regional factors in these states.
The states in which we operate that have the largest concentrations of revenues as of December 31, 2025 include Florida, Texas and Georgia. Due to the geographic concentration of our business, we are exposed to heightened risks of potential losses resulting from unfavorable changes in the regulatory environment for healthcare, increased competition, and other regional factors in these states.
Our ability to make scheduled payments of the principal of, to pay interest on or to refinance our indebtedness, including the 2031 Notes, depends on our future performance, which is subject to economic, financial, competitive and other factors beyond our control.
Our ability to make scheduled payments of the principal of, to pay interest on, or to refinance our indebtedness, including the 2031 Notes and 2030 Notes (together, the “Notes”), depends on our future performance, which is subject to economic, financial, competitive and other factors beyond our control.
Such indebtedness, including borrowings, if any, under the Revolving Credit Facility, could have significant effects on our business, such as: • limiting our ability to borrow additional amounts to fund capital expenditures, acquisitions, debt service requirements, execution of our growth strategy and other purposes; • limiting our ability to make investments, including acquisitions, loans and advances, and to sell, transfer or otherwise dispose of assets; • requiring us to dedicate a substantial portion of our cash flow from operations to pay principal and interest on our borrowings, which would reduce availability of our cash flow to fund working capital, capital expenditures, acquisitions, execution of our growth strategy and other general corporate purposes; • making us more vulnerable to adverse changes in general economic, industry and competitive conditions, in government regulation and in our business by limiting our ability to plan for and react to changing conditions; • placing us at a competitive disadvantage compared with our competitors that have less debt; and • exposing us to risks inherent in interest rate fluctuations because our borrowings are at variable rates of interest, which could result in higher interest expense in the event of increases in interest rates.
Such indebtedness, including borrowings, if any, under the 2026 Revolving Credit Facility or our other current indebtedness, could have significant effects on our business, such as: • limiting our ability to borrow additional amounts to fund capital expenditures, acquisitions, debt service requirements, execution of our growth strategy and other purposes; • limiting our ability to make investments, including acquisitions, loans and advances, and to sell, transfer or otherwise dispose of assets; • requiring us to dedicate a substantial portion of our cash flow from operations to pay principal and interest on our borrowings, which would reduce availability of our cash flow to fund working capital, capital expenditures, acquisitions, execution of our growth strategy and other general corporate purposes; • making us more vulnerable to adverse changes in general economic, industry and competitive conditions, in government regulation and in our business by limiting our ability to plan for and react to changing conditions; • placing us at a competitive disadvantage compared with our competitors that have less debt; and • exposing us to risks inherent in interest rate fluctuations, as a portion of our indebtedness (including amounts drawn under the 2026 Revolving Credit Facility) or any future indebtedness may be at variable rates of interest, which could result in higher interest expense and increased debt service obligations in the event of increases in interest rates.
In some states, and under federal law for our business subject to the No Surprises Act, the amount of compensation and/or process to dispute out-of- 33 Table of Contents network reimbursement amounts is defined by law or regulation.
In some states, and under federal law for our business subject to the No Surprises Act, the amount of compensation and/or process to dispute out-of-network reimbursement amounts is defined by law or regulation.
Our Amended Charter, our amended and restated bylaws (the “Amended Bylaws”), and Delaware law contain provisions that could have the effect of rendering more difficult, delaying or preventing an acquisition deemed undesirable by our board of directors.
Our Amended Charter, Amended Bylaws, and Delaware law contain provisions that could have the effect of rendering more difficult, delaying or preventing an acquisition deemed undesirable by our board of directors.
As of December 31, 2024, we had federal income tax NOLs of $2.2 billion and state NOLs of $1.3 billion, which are currently subject to a full valuation allowance. The NOLs are available to offset our future taxable income, if any, prior to consideration of annual limitations that may be imposed under Section 382 of the U.S.
As of December 31, 2025, we had federal income tax NOLs of $2.6 billion and state NOLs of $1.4 billion, which are currently subject to a full valuation allowance. The NOLs are available to offset our future taxable income, if any, prior to consideration of annual limitations that may be imposed under Section 382 of the U.S.
The CCPA and CPRA contain exemptions to which our business is subject, such as for 29 Table of Contents medical information governed by the California Confidentiality of Medical Information Act, and for PHI collected by a covered entity or business associate governed by the privacy, security, and breach notification rule established pursuant to HIPAA; however, information we hold about individual residents of California that is not subject to such exceptions (or another applicable exception) would be subject to the CCPA and CPRA.
The CCPA and CPRA contain exemptions to which our business is subject, such as for medical information governed by the California Confidentiality of Medical Information Act, and for PHI collected by a covered entity or business associate governed by the privacy, security, and breach notification rule established pursuant to HIPAA; however, information we hold about individual residents of California that is not subject to such exceptions (or another applicable exception) would be subject to the CCPA and CPRA, such as workforce personal data.
If we are successful in establishing a new health plan or entering a new market, increasing membership, revenues and medical costs could trigger further increased capital requirements, including risk-based capital (“RBC”), that could substantially exceed the net income generated by the health plan or in the new market.
If we are successful in establishing a new health plan or entering a new market, increasing membership, revenues and medical costs could trigger further increased capital requirements, including RBC, that could substantially exceed the net income generated by the health plan or in the new market.
If we were unable to repay or otherwise refinance these borrowings and loans when due, and the applicable lenders proceeded to exercise remedies against the collateral granted to them to secure that indebtedness, we may be forced into 47 Table of Contents bankruptcy or liquidation.
If we were unable to repay or otherwise refinance these borrowings and loans when due, and the applicable lenders proceeded to exercise remedies against the collateral granted to them to secure that indebtedness, we may be forced into bankruptcy or liquidation.
In addition, our membership may increase as a result of other factors over which we have limited control, including as a result of regulatory actions or other developments that contribute to an increase in participants in the Health Insurance Marketplace, which similarly could trigger further increased capital requirements that could be substantial.
In addition, our membership may increase as a result of other factors over which we have limited control, including as a result of regulatory actions or other developments that contribute to an increase in participants in the Health Insurance Marketplaces, or that contribute to certain of our competitors leaving the Health Insurance Marketplaces, which similarly could trigger further increased capital requirements that could be substantial.
We cannot control the availability or pricing of third-party software and infrastructure, and if the models we currently use in connection with AI Technologies become incompatible with our applications or unavailable for use, or if the providers of such models unfavorably changes the terms on which their AI Technologies are offered or terminates their relationship with us, we could be required to expend time and resources to either find a replacement vendor and/or to mitigate the impact to our business, and our business could be harmed.
We cannot control the availability or pricing of third-party software and infrastructure, and if the models we currently use in connection with our AI Technologies become incompatible with our applications or unavailable for use, or if the providers of such models unfavorably change the terms on which their AI Technologies are offered or terminate their relationship with us, we could be required to expend time and resources to either find replacement vendors and/or to mitigate the impact to our business, and our business could be harmed.
Compliance with the CCPA and the CPRA may require us to modify our data collection or processing practices and policies and to incur substantial costs and expenses and may increase our potential exposure to regulatory enforcement and/or litigation.
Compliance with the CCPA and the CPRA may require us to modify our data collection or processing practices and policies and to incur substantial costs and expenses and may increase our potential 33 Table of Contents exposure to regulatory enforcement and/or litigation.
We are periodically subject to government audits, including CMS Risk Adjustment Data Valuation (“RADV”) audits of our ACA plans to validate diagnostic data, patient claims and financial reporting, and we may be subject to ongoing RADV audits related to our historical Medicare Advantage plans and audits of our historical Medicare Part D plans by the Medicare Part D Recovery Audit Contractor (“RAC”) programs authorized by the ACA.
In addition, we are periodically subject to government audits, including CMS RADV audits of our ACA plans to validate diagnostic data, patient claims and financial reporting, and we may be subject to ongoing RADV audits related to our historical Medicare Advantage plans and audits of our historical Medicare Part D plans by the Medicare Part D Recovery Audit Contractor (“RAC”) programs authorized by the ACA.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeOur cybersecurity risk management program includes: • risk assessments designed to help identify material cybersecurity risks to our critical systems, information, products, services, and our broader enterprise IT environment; 54 Table of Contents • a security team principally responsible for managing (1) our cybersecurity risk assessment processes, (2) our security controls, and (3) our response to cybersecurity incidents; • the use of external service providers, where appropriate, to assess, test or otherwise assist with aspects of our security controls, and conduct tabletop exercises to validate our cybersecurity incident response processes; • the use of various technology and process-based methods, such as network isolation, intrusion detection systems, vulnerability assessments, penetration testing, use of threat intelligence, content filtering, endpoint security (including anti-malware and detection response capabilities), email security mechanisms, and access control mechanisms; • cybersecurity awareness training of our employees, including incident response personnel and senior management; • a cybersecurity incident response plan that includes procedures for responding to cybersecurity incidents; and • a third-party risk management and diligence process for vendors and service providers.
Biggest changeOur cybersecurity risk management program includes: • risk assessments designed to help identify material risks from cybersecurity threats to our critical systems and information; • a security team principally responsible for managing (1) our cybersecurity risk assessment processes, (2) our security processes, and (3) our response to cybersecurity incidents; • the use of external service providers, where appropriate, to assess, test or otherwise assist with aspects of our security controls, and conduct tabletop exercises to validate our cybersecurity incident response processes; • the use of various technology and process-based methods, such as network isolation, intrusion detection systems, vulnerability assessments, penetration testing, use of threat intelligence, content filtering, endpoint security (including anti-malware and detection response capabilities), email security mechanisms, and access control mechanisms; • cybersecurity awareness training of our employees, including incident response personnel and senior management; • a cybersecurity incident response plan that includes procedures for responding to cybersecurity incidents; and • a third-party risk management and diligence process for key vendors and service providers based on our assessment of their criticality to our operations and respective risk profile. 60 Table of Contents While we have implemented processes to maintain our cybersecurity risk management program, there can be no assurance that our program, including our controls, procedures and processes, will be fully complied with or that it will be fully effective in protecting the confidentiality, integrity and availability of our critical systems and information.
This experience has enhanced his expertise in cybersecurity governance and risk management. Our CISO is a Certified Information Systems Security Professional and his experience includes over 20 years of working in the cybersecurity field in various industries, including data analytics, identity verification software, and financial services industries, and 15 years leading teams and programs .
This experience has enhanced his expertise in cybersecurity governance and risk management. Our CISO is a Certified Information Systems Security Professional and his experience includes over 20 years of working in the cybersecurity field in various industries, including data analytics, identity verification software, and financial services industries, and over 15 years leading teams and programs .
The Committee reports to the full Board regarding its activities, including those related to cybersecurity. Our management team, including our Chief Technology Officer and Chief Information Security Officer (CISO), is responsible for assessing and managing our material risks from cybersecurity threats.
The Committee reports to the full Board regarding its activities, including those related to cybersecurity. Our management team, including our Chief Technology Officer and Chief Information Security Officer (“CISO”), is responsible for assessing and managing our material risks from cybersecurity threats.
Our cybersecurity risk management program is integrated into our overall enterprise risk management program, and shares common methodologies, reporting channels and governance processes that apply across the enterprise risk management program to other legal, compliance, strategic, operational, and financial risk areas.
Our cybersecurity risk management program is integrated into our overall ERM program, and shares common methodologies, reporting channels and governance processes that apply across the ERM program to other legal, compliance, strategic, operational, and financial risk areas.
Item 1C. Cybersecurity Cybersecurity Risk Management and Strategy We have developed and implemented a cybersecurity risk management program intended to protect the confidentiality, integrity, and availability of our critical systems and information, including protected health information and the systems that store and transmit such data. Our cybersecurity risk management program includes a cybersecurity incident response plan.
Item 1C. Cybersecurity Cybersecurity Risk Management and Strategy We have developed and implemented a cybersecurity risk management program intended to protect the confidentiality, integrity, and availability of our critical systems and information, including PHI and the systems that store and transmit such data. Our cybersecurity risk management program includes a cybersecurity incident response plan.
See Part I, Item 1A “Risk Factors—Risks Related to our Business—If we or our partners or other third parties with whom we collaborate fail to protect confidential information and/or sustain a data security incident, we could suffer increased costs, material financial penalties, exposure to significant liability, adverse regulatory consequences, and reputational harm, which would materially adversely affect our business, results of operations, and financial condition.” Cybersecurity Governance Our Board considers cybersecurity risk as part of its risk oversight function and has delegated to t he Audit Committee (Committee) oversight of cybersecurity risks.
“Risk Factors—Risks Related to our Business—If we or our partners or other third parties with whom we collaborate fail to protect confidential information and/or sustain a data security incident, we could suffer increased costs, material financial penalties, exposure to significant liability, adverse regulatory consequences, and reputational harm, which would materially adversely affect our business, results of operations, and financial condition.” Cybersecurity Governance Our board of directors (“Board”) considers cybersecurity risk as part of its risk oversight function and has delegated to t he Audit Committee (the “Committee”) oversight of cybersecurity risks.
The Committee oversees management of our cybersecurity risks, including reviewing and discussing with management our major cybersecurity risk exposures and the steps management has taken to monitor and control such exposures. Management provides quarterly reports on our cybersecurity risks to the Committee. In addition, management updates the Committee, as necessary, regarding any material cybersecurity incidents.
The Committee oversees management of our cybersecurity risks, including reviewing and discussing with management our major cybersecurity risk exposures and the steps management has taken to monitor and control such exposures. Management provides quarterly reports on our cybersecurity risks to the Committee. In addition, management updates the Committee, as necessary, regarding any cybersecurity incidents it considers to be significant.
We have not identified risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that have materially affected or are reasonably likely to materially affect us, including our operations, business strategy, results of operations, or financial condition.
We have not identified risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that have materially affected us, including our operations, business strategy, results of operations, or financial condition.
Our management team supervises efforts to prevent, detect, mitigate, and remediate cybersecurity risks and incidents through various means, which may include briefings from internal security personnel; threat intelligence and other information obtained from the Health Information Sharing and Analysis Center and other governmental, public or private sources; and alerts and reports produced by security tools deployed in the IT environment.
Our management team takes steps to stay informed about and monitor efforts to prevent, detect, mitigate, and remediate cybersecurity risks and incidents through various means, which may include briefings from internal security personnel; threat intelligence and other information obtained from the Health Information Sharing and Analysis Center and other governmental, public or private sources; and alerts and reports produced by security tools deployed in the information technology environment.
We use the ISO 27001 standard as a guide to help us identify, assess, and manage cybersecurity risks relevant to our business. This does not imply that we meet any particular technical standards, specifications or requirements.
We use the ISO 27001 and National Institute of Standards and Technology (“NIST”) 800-53 standards as a guide to help us identify, assess, and manage cybersecurity risks relevant to our business. This does not imply that we meet any particular technical standards, specifications or requirements.
Removed
While we have implemented processes to maintain our cybersecurity risk management program, there can be no assurance that our program, including our controls, procedures and processes, will be fully complied with or that it will be fully effective in protecting the confidentiality, integrity and availability of our critical systems and information.
Added
We face risks from cybersecurity threats that, if realized, are reasonably likely to materially affect us, including our operations, business strategy, results of operations, or financial condition. See Part I, Item 1A.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeItem 2. Properties We lease our corporate headquarters located in New York, New York. We lease additional office space in Tempe, Arizona and Los Angeles, California. We believe that our properties are adequate and suitable for our business as presently conducted. 55 Table of Contents
Biggest changeItem 2. Properties We lease our corporate headquarters located in New York, New York. We lease six additional office spaces in other locations throughout the U.S. We believe that our properties are adequate and suitable for our business as presently conducted.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeItem 3. Legal Proceedings The information required under this Part I, Item 3 is set forth in Note 19 - Commitments and Contingencies to our Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K.
Biggest changeItem 3. Legal Proceedings The information required under this Part I, Item 3 is set forth in “Note 18 - Commitments and Contingencies” to our Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeEach of the Thrive Capital affiliated funds and the Anahata Foundation may be deemed to be an “affiliated purchaser” as defined in Rule 10b-18(a)(3) under the Exchange Act. 57 Table of Contents Performance Graph The following graph illustrates the cumulative total shareholder return on our Class A common stock from March 3, 2021, the first day the Company's stock was publicly traded, through December 31, 2024, relative to the performance of the S&P 500 Index and a group of eleven peers selected by the Company.
Biggest changePerformance Graph The following graph illustrates the cumulative total shareholder return on our Class A common stock from March 3, 2021, the first day the Company's stock was publicly traded, through December 31, 2025, relative to the performance of the S&P 500 Index and a group of eleven peers selected by the Company.
We are regulated under state insurance holding company laws and our subsidiaries are subject to stringent regulations, including mandatory statutory capital and surplus requirements, that may restrict our or our subsidiaries’ ability to declare dividends or limit the amount of dividends and distributions that can be paid without approval of, or notification to, state regulators.
We are regulated under state insurance holding company laws and our Health Insurance Subsidiaries are subject to stringent regulations, including mandatory statutory capital and surplus requirements, that may restrict our or our Health Insurance Subsidiaries’ ability to declare dividends or limit the amount of dividends and distributions that can be paid without approval of, or notification to, state regulators.
The graph assumes that $100 was invested on March 3, 2021 in each of our Class A common stock, the S&P 500 Index, the peer group, and that any dividends were reinvested. The comparisons reflected in the graph are not intended to forecast or otherwise be indicative of the future performance of our stock.
The graph assumes that $100 was invested on March 3, 2021 in each of our Class A common stock, the S&P 500 Index, the 2024 Peer Group and the 2025 Peer Group, and that any dividends were reinvested. The comparisons reflected in the graph are not intended to forecast or otherwise be indicative of the future performance of our stock.
Holders As of January 31, 2025, there were 16 holders of record of our Class A common stock and 11 holders of record of our Class B common stock. Dividend Policy We have never declared or paid any cash dividends on our capital stock.
Holders As of January 31, 2026, there were 12 holders of record of our Class A common stock and 11 holders of record of our Class B common stock. Dividend Policy We have never declared or paid any cash dividends on our capital stock.
The peer group is composed of Centene Corporation, Molina Healthcare, Inc., CVS Health Corporation, Cigna Group, Elevance Health, Inc., Agilon Health Inc., Alignment Healthcare, Inc., Evolent Health, Inc., Privia Health Group, Inc., Teladoc Health, Inc., and Accolade, Inc.
The peer group was previously composed of Centene Corporation, Molina Healthcare, Inc., CVS Health Corporation, Cigna Group, Elevance Health, Inc., Agilon Health Inc., Alignment Healthcare, Inc., Evolent Health, Inc., Privia Health Group, Inc., Teladoc Health, Inc., and Accolade, Inc. (“2024 Peer Group”).
In addition, the terms of our Revolving Credit Facility, and other indebtedness we may enter into from time to time, restricts our ability and that of our subsidiaries’ to, among other things, pay dividends or make other distributions on equity interests.
In addition, other indebtedness we may enter into from time to time may restrict our ability and that of our subsidiaries’ to, among other things, pay dividends or make other distributions on equity interests.
Company/Index 03/03/21 12/31/21 12/31/22 12/31/23 12/31/24 Oscar Health, Inc. $ 100.00 $ 22.56 $ 7.07 $ 26.29 $ 38.62 S&P 500 $ 100.00 $ 126.22 $ 103.34 $ 130.48 $ 163.09 Peer Group $ 100.00 $ 131.10 $ 141.76 $ 129.93 $ 100.48
Company/Index 03/03/21 12/31/21 12/31/22 12/31/23 12/31/24 12/31/25 Oscar Health, Inc. $ 100.00 $ 22.56 $ 7.07 $ 26.29 $ 38.62 $ 41.29 S&P 500 $ 100.00 $ 126.22 $ 103.34 $ 130.48 $ 163.09 $ 192.39 2024 Peer Group $ 100.00 $ 131.10 $ 141.76 $ 129.93 $ 100.48 $ 104.25 2025 Peer Group $ 100.00 $ 127.88 $ 135.71 $ 123.98 $ 91.17 $ 100.41 63 Table of Contents Item 6. [Reserved]
Removed
Recent Sales of Unregistered Securities; Purchases of Equity Securities by the Issuer or Affiliated Purchasers The following table sets forth purchases of shares of our Class A common stock made during the three months ended December 31, 2024 by or on behalf of the Company or an “affiliated purchaser” as defined in Rule 10b-18(a)(3) under the Exchange Act.
Added
Recent Sales of Unregistered Securities On September 18, 2025, we issued $410.0 million aggregate principal amount of 2030 Notes. See “Note 9 - Debt” , as well as Item 3.02 of our Current Report on Form 8-K filed with the SEC on September 18, 2025, for additional information on this issuance.
Removed
Period Total Number of Class A Shares Purchased Average Price Paid per Class A Share (1) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs (in thousands) 11/1/24 to 11/30/24 2,521,728 (1) $14.40 per share — — (1) Includes (i) 1,588,395 shares purchased in open market transactions by funds affiliated with Thrive Capital.
Added
In addition, on November 3, 2025, the Company and Oasis FD Holdings, LP (“Dragoneer”) entered into an Exchange Agreement (the “Exchange Agreement”) pursuant to which, until December 14, 2025, Dragoneer could elect to exchange up to $250.0 million aggregate principal amount of 2031 Notes, representing the balance of its 2031 Notes, for aggregate consideration consisting of (A) a number of shares of Class A common stock based on the conversion rate set forth in the applicable indenture, and (B) up to $17.8 million, payable in shares of Class A common stock and/or cash, pursuant to the terms of the Exchange Agreement and subject to the satisfaction of certain conditions.
Removed
Joshua Kushner, the Vice Chairman of our board of directors, is the sole managing member of each of the General Partners of the Thrive Capital affiliated funds and (ii) 933,333 shares purchased in open market transactions by the Anahata Foundation, a charitable foundation established by Mark T. Bertolini, our Chief Executive Officer.
Added
On November 5, 2025, Dragoneer exchanged $187.5 million aggregate principal amount of their 2031 Notes for approximately 22.5 million shares of Class A common stock, and on November 18, 2025, Dragoneer exchanged the remaining $62.5 million aggregate principal amount balance of their 2031 Notes for approximately 7.5 million shares of Class A common stock.
Added
Additionally, in connection with the exchange, Dragoneer also received an inducement payment totaling $17.8 million, of which $4.4 million was paid in cash and the remaining $13.3 million was settled through the issuance of approximately 0.7 million additional shares of Class A common stock.
Added
In connection with the Exchange Agreement and the related transactions, as of November 5, 2025, the debt covenants in the Investment Agreement dated January 27, 2022 among the parties to the 2031 Notes (as amended, the “Investment Agreement”) were extinguished, and the 2030 Notes ceased to be subordinated to the 2031 Notes.
Added
The Shares were issuable in reliance upon Section 3(a)(9) of the Securities Act as involving an exchange by the Company exclusively with its security holder. 62 Table of Contents Purchases of Equity Securities by the Issuer or Affiliated Purchasers None.
Added
In 2025, the Company reviewed the peer group, and as a result of the pending acquisition of Accolade, Inc., Accolade, Inc. was determined to fall outside one or more of the defined parameters and was removed from the peer group.
Added
One company, Humana Inc., was added to the peer group, reflecting its relevance from an industry, revenue, and market capitalization standpoint (the 2024 Peer Group, as so adjusted, “2025 Peer Group”).

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeFor additional details relating to the 2031 Notes, see Note 9 - Debt to our Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K, and, “Risk Factors–Risks Related to Indebtedness–Our debt obligations contain restrictions that impact our business and expose us to risks that could materially adversely affect our liquidity and financial condition” and “Risk Factors–Risks Related to Indebtedness–We may be unable to raise the funds necessary to repurchase our outstanding 2031 Notes for cash following a fundamental change or on the optional repurchase dates, or to pay any cash amounts due upon conversion, and our other indebtedness may limit our ability to repurchase the 2031 Notes or pay cash upon their conversion.” Revolving Credit Facility On December 28, 2023, we entered into a third amendment to our senior secured credit agreement (the “Third Amendment”), with Wells Fargo Bank, National Association, as lender and the administrative agent, and certain other lenders party thereto from time to time (collectively the “Lenders”), and Oscar Management Corporation, as a subsidiary guarantor, which amended the senior secured credit agreement, dated as of February 21, 2021 (as amended by the First Amendment to Credit Agreement, dated as of January 27, 2022, and as further amended by the Second Amendment to Credit Agreement, dated as of July 21, 2023, the “Credit Agreement” and as amended by the Third Amendment, the “Amended Credit Agreement”).
Biggest change“ Risk Factors–Risks Related to Indebtedness–Our debt obligations contain restrictions that impact our business and expose us to risks that could materially adversely affect our liquidity and financial condition” and “Risk Factors–Risks Related to Indebtedness–We may be unable to raise the funds necessary to repurchase our outstanding Notes for cash following a fundamental change or on the optional repurchase dates, or to pay any cash amounts due upon conversion, and our other indebtedness may limit our ability to repurchase the Notes or pay cash upon their conversion. ” 2030 Convertible Senior Notes On September 18, 2025, the Company issued $410.0 million aggregate principal amount of convertible senior notes due 2030 (the “2030 Notes”).
Medical claims include fee-for-service claims, pharmacy benefits, capitation payments to providers, provider disputed claims and various other medical-related costs. Under fee-for-service claims arrangements with providers, we retain the financial responsibility for medical care provided and incur costs based on actual utilization of hospital and physician services. Medical claims are recognized in the period healthcare services are provided.
Medical claims include fee-for-service claims, pharmacy benefits, capitation payments to providers, disputed provider claims, and various other medical-related costs. Under fee-for-service claims arrangements with providers, we retain the financial responsibility for medical care provided and incur costs based on actual utilization of hospital and physician services. Medical claims are recognized in the period healthcare services are provided.
Based on our current forecast, we believe the Company's cash, and cash equivalents and investments, not including restricted cash, will be sufficient to fund our operating requirements for at least the next twelve months. Some of our payments and receipts, including risk adjustment transfers and reinsurance receipts, can be significant.
Based on our current forecast, we believe the Company's cash, cash equivalents, and investments, not including restricted cash, will be sufficient to fund our operating requirements for at least the next twelve months. Some of our payments and receipts, including risk adjustment transfers, and reinsurance receipts, can be significant.
If regulators do not approve our reinsurance agreements for this purpose, or if we cannot negotiate renewals of our quota share arrangements on acceptable terms, or at all, enter into new agreements with reinsurers, or otherwise obtain capital through debt or equity financings, our capital position would be negatively impacted, and we could fall out of compliance with applicable regulatory requirements” and “Risk Factors — Risks Most Material to Us — Our business, financial condition, and results of operations may be harmed if we fail to execute our strategy and manage our growth effectively.” Short-Term Cash Requirements The Company’s cash requirements within the next twelve months include benefits payable, risk adjustment transfer payable, current lease liabilities, interest payable on debt, other current liabilities and purchase commitments and other obligations.
If regulators do not approve our reinsurance agreements for this purpose, or if we cannot negotiate renewals of our quota share arrangements on acceptable terms, or at all, or enter into new agreements with reinsurers, or otherwise obtain capital through debt or equity financings, our capital position would be negatively impacted, and we could fall out of compliance with applicable regulatory requirements” and “Risk Factors — Risks Most Material to Us — Our business, financial condition, and results of operations may be harmed if we fail to execute our strategy and manage our growth effectively.” Short-Term Cash Requirements The Company’s cash requirements within the next twelve months include benefits payable, risk adjustment transfer payables, current lease liabilities, interest payable on debt, other current liabilities and purchase commitments, and other obligations.
Summary of Cash Flows Our cash flows used in operations may differ substantially from our net loss due to non-cash charges or due to changes in balance sheet accounts. The timing of our cash flows from operating activities can also vary among periods due to the timing of payments made or received.
Summary of Cash Flows Our cash flows used in operations may differ substantially from our net income (loss) due to non-cash charges or due to changes in balance sheet accounts. The timing of our cash flows from operating activities can also vary among periods due to the timing of payments made or received.
Item 7. Management’s Discussion and Analysis (“MD&A”) of Financial Condition and Results of Operations. The following discussion and analysis of our financial condition and results of operations as of December 31, 2024 and 2023 should be read in conjunction with our audited Consolidated Financial Statements and the related notes included elsewhere in this filing.
Item 7. Management’s Discussion and Analysis (“MD&A”) of Financial Condition and Results of Operations. The following discussion and analysis of our financial condition and results of operations as of December 31, 2025 and 2024 should be read in conjunction with our audited Consolidated Financial Statements and the related notes included elsewhere in this filing.
The reinsurance agreements do not relieve us of our primary medical claims incurred obligations. Refer to Note 11 - Reinsurance to our Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K for a description of the accounting methods used to record our quota share reinsurance arrangements.
The reinsurance agreements do not relieve us of our primary medical claims incurred obligations. Refer to “Note 11 - Reinsurance” to our Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K for a description of the accounting methods used to record our quota share reinsurance arrangements.
As our health insurance subsidiaries have collectively become profitable and to the extent their levels of statutory capital and surplus continue to exceed minimum regulatory requirements, we may make periodic requests for dividends and distributions from our subsidiaries to fund our operations or seek to enter into transactions or structures that enable us to efficiently deploy this excess capital, which may or may not require approval by our regulators.
As certain of our Health Insurance Subsidiaries have become profitable and to the extent their levels of statutory capital and surplus exceed applicable minimum regulatory requirements, we may make periodic requests for dividends and distributions from our subsidiaries to fund our operations or seek to enter into transactions or structures that enable us to efficiently deploy this excess capital, which may or may not require approval by our regulators.
In connection with the sale and issuance of the 2031 Notes, on January 27, 2022, we entered into an investment agreement with the Initial Purchasers (the “Investment Agreement”) and on February 3, 2022, we entered into an indenture with U.S. Bank, as Trustee (the “Indenture”).
In connection with the sale and issuance of the 2031 Notes, on January 27, 2022, we entered into an investment agreement with the Initial Purchasers (the “Investment Agreement”) and on February 3, 2022, we entered into an indenture with U.S. Bank, as Trustee (the “2031 Indenture”).
We estimate that had we not had any quota share reinsurance arrangements in place, the health insurance subsidiaries would have been required to hold approximately $553.8 million and $447.1 million of additional capital as of December 31, 2024 and 2023 , respectively, which the Parent would have been required to fund to the extent the applicable insurance subsidiary did not have excess capital to cover the requirement.
We estimate that had we not had any quota share reinsurance arrangements in place, the Health Insurance Subsidiaries would have been required to hold approximately $683.1 million and $553.8 million of additional capital as of December 31, 2025 and 2024 , respectively, which the Parent would have been required to fund to the extent the applicable Health Insurance Subsidiaries did not have excess capital to cover the requirement.
The following discussion and analysis does not include certain items related to the year ended December 31, 2023, including year-to-year comparisons between the year ended December 31, 2023 and the year ended December 31, 2022. For a comparison of our results of operations for the fiscal years ended December 31, 2023 and December 31, 2022, see Item 7.
The following discussion and analysis does not include certain items related to the year ended December 31, 2024, including year-to-year comparisons between the year ended December 31, 2024 and the year ended December 31, 2023. For a comparison of our results of operations for the fiscal years ended December 31, 2024 and December 31, 2023, see Part II, Item 7.
The health insurance subsidiaries may be subject to additional capital and surplus requirements in the future, as a result of factors such as increasing membership and medical costs, which may require us to incur additional indebtedness, sell capital stock, or access other sources of funding in order to fund such requirements.
The Health Insurance Subsidiaries may be subject to additional capital and surplus requirements in the future, as a result of factors such as increasing membership and medical costs or changes in risk adjustment transfer estimates, which may require us to incur additional indebtedness, sell capital stock, or access other sources of funding in order to fund such requirements.
Risk Adjustment The risk adjustment programs in the markets we serve are administered federally by CMS and are designed to mitigate the potential impact of adverse selection and provide stability for health insurers. Under this program, each plan is assigned a risk score based upon demographic information and current year claims information related to its members.
Risk Adjustment The risk adjustment programs in the markets we serve are administered federally by CMS and are designed to mitigate the potential impact of adverse selection and provide stability for Health Insurance Entities. Under these programs, each plan is assigned a risk score based upon demographic information and current year claims information related to its members.
Other accounting policies are disclosed in Item 8, Financial Statements and Supplementary Data in this Annual Report on Form 10-K. 62 Table of Contents Benefits Payable Benefits payable includes estimates of the ultimate cost of claims that have been incurred but not reported, including expected development on reported claims, those that have been reported but not yet paid (reported claims in process) and other medical care expenses and services payable.
Other accounting policies are disclosed in Part II, Item 8, “Financial Statements and Supplementary Data,” in this Annual Report on Form 10-K. 68 Table of Contents Benefits Payable Benefits payable includes estimates of the ultimate cost of claims that have been incurred but not reported, including expected development on reported claims, those that have been reported but not yet paid (reported claims in process) and other medical care expenses and services payable.
For example, during the third quarter of 2024, we made a payment through our health insurance subsidiaries of approximately $1,056.8 million into the risk adjustment program, for the 2023 policy year. As such, timing of payments and receipts can influence cash flows from operating activities in any given period which would have a negative impact on our operating cash flows.
For example, during the third quarter of 2025, we made a payment through our Health Insurance Subsidiaries of approximately $1.6 billion into the risk adjustment program, for the 2024 policy year. As such, timing of payments and receipts can influence cash flows from operating activities in any given period which would have a negative impact on our operating cash flows.
For additional information see Part I, Item 1A “Risk Factors—Risks Related to our Business—If state regulators do not approve payments of dividends and distributions by our health insurance subsidiaries to us, or do not approve other capital efficiency structures we may pursue, we may not have sufficient funds to implement our business strategy.” 69 Table of Contents Our health insurance subsidiaries also utilize quota share reinsurance arrangements to reduce our minimum capital and surplus requirements, which are designed to enable us to efficiently deploy capital to fund our growth.
“Risk Factors—Risks Related to our Business—If state regulators do not approve payments of dividends and distributions by our Health Insurance Subsidiaries to us, or do not approve other capital efficiency structures we may pursue, we may not have sufficient funds to implement our business strategy.” 75 Table of Contents Our Health Insurance Subsidiaries also utilize quota share reinsurance arrangements to reduce our minimum capital and surplus requirements, which are designed to enable us to efficiently deploy capital to fund our growth.
Professional portfolio managers operating under documented guidelines manage our investments and a portion of our cash equivalents. Our portfolio managers are directed to obtain our prior approval before selling investments in a loss position. Net investment income on a consolidated basis was $185.7 million and $155.4 million for the year ended December 31, 2024 and 2023, respectively.
Professional portfolio managers operating under documented guidelines manage our investments and a portion of our cash equivalents. Our portfolio managers are directed to obtain our prior approval before selling investments in a loss position. Net investment income on a consolidated basis was $202.9 million and $185.7 million for the years ended December 31, 2025 and 2024, respectively.
Our primary operating cash flow uses are payments for claims, risk adjustment transfers, and operating expenses, including interest expense. For the year ended December 31, 2024, net cash provided by operating activities was $978.2 million as compared with $272.2 million used in operating activities for the same period in 2023.
Our primary operating cash flow uses are payments for claims, risk adjustment transfers, and operating expenses, including interest expense. For the year ended December 31, 2025, net cash provided by operating activities was $1,094.9 million as compared with $978.2 million for the same period in 2024.
INDEX TO MD&A Management's discussion and analysis of financial condition and results of operations is comprised of the following sections: Page Overview 59 Recent Developments, Trends and Other Key Factors Impacting Performance 55 Critical Accounting Policies and Estimates 62 Components of our Results of Operations 65 Results of Operations 66 Liquidity and Capital Resources 69 Overview Oscar is a leading healthcare technology company built around a full stack technology platform and a relentless focus on member experience.
INDEX TO MD&A Management's discussion and analysis of financial condition and results of operations is comprised of the following sections: Page Overview 64 Recent Developments, Trends and Other Key Factors Impacting Performance 65 Critical Accounting Policies and Estimates 68 Components of our Results of Operations 71 Results of Operations 73 Liquidity and Capital Resources 75 Overview Oscar is a leading healthcare technology company built around a full stack technology platform and a relentless focus on member experience.
Net investment income for our health insurance subsidiaries was $174.9 million and $146.7 million for the year ended December 31, 2024 and 2023, respectively. Our restricted investments consist primarily of cash and cash equivalents and U.S. Treasury securities; we have the ability to hold such restricted investments until maturity.
Net investment income for our Health Insurance Subsidiaries was $191.6 million and $174.9 million for the years ended December 31, 2025 and 2024, respectively. Our restricted investments consist primarily of cash and cash equivalents and U.S. Treasury securities; we have the ability to hold such restricted investments until maturity.
We have been challenging the status quo in the healthcare system since our founding in 2012, and are dedicated to making a healthier life accessible and affordable for all. Oscar serves individuals, families, and employees through the ACA and offers health technology solutions that power the healthcare industry through +Oscar.
We have been challenging the status quo in the healthcare system since our founding in 2012, and are dedicated to making a healthier life accessible and affordable for all. Oscar serves individuals, families, and employees through the Patient Protection and Affordable Care Act (“ACA”). We also offer health technology solutions that power the healthcare industry through +Oscar.
As of December 31, 2024 and December 31, 2023, total cash and cash equivalents and investments held by our health insurance subsidiaries was $3,808.0 million and $2,721.2 million, respectively, of which $18.0 million and $17.3 million, respectively, was on deposit with regulators as required for statutory licensing purposes. These amounts are classified as restricted deposits on the Consolidated Balance Sheets.
As of December 31, 2025 and December 31, 2024, total cash and cash equivalents and investments held by our Health Insurance Subsidiaries was $5.1 billion and $3.8 billion respectively, of which $18.3 million and $18.0 million, respectively, was on deposit with regulators as required for statutory licensing purposes. These amounts are classified as restricted deposits on the Consolidated Balance Sheets.
For additional information on our capital contributions and reinsurance arrangements, see “Risk Factors — Risks Related to our Business — We utilize quota share reinsurance to reduce our capital and surplus requirements and protect against downside risk on medical claims.
For additional information on our capital contributions and reinsurance arrangements, see Part I, Item 1A. “Risk Factors — Risks Related to our Business — We utilize quota share reinsurance to meet regulatory capital and surplus requirements and protect against downside risk on medical claims.
Some of our payments and receipts, including loss settlements and subsequent reinsurance receipts, can be significant. Therefore, their timing can influence cash flows from operating activities in any given period.
Some of our payments and receipts, including loss settlements, rebates from our pharmacy benefit manager, risk adjustment transfers, and subsequent reinsurance receipts, can be significant. Therefore, their timing can influence cash flows from operating activities in any given period.
Assuming a hypothetical 1% difference between our December 31, 2024 estimates of benefits payable and actual benefits payable, excluding any potential offsetting impact from premium rebates, net earnings for the year ended December 31, 2024 would have increased by approximately $172.7 million or decreased by approximately $165.6 million.
Assuming a hypothetical 1% difference between our December 31, 2025 estimates of benefits payable and actual benefits payable, excluding any potential offsetting impact from premium rebates, net earnings for the year ended December 31, 2025 would have increased by approximately $250.0 million or decreased by approximately $201.2 million.
During the years ended December 31, 2024 and 2023, the Parent made $146.6 million and $19.5 million of capital contributions, respectively, to the health insurance subsidiaries.
During the years ended December 31, 2025 and 2024, the Parent made $120.8 million and $146.6 million of capital contributions, respectively, to the Health Insurance Subsidiaries.
Management's Discussion and Analysis of Financial Condition and Results of Operations of our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on February 15, 2024.
“Management's Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, 2024, filed with the SEC on February 20, 2025.
The Company may record a receivable or payable as an adjustment to premium revenues to reflect the year-to-date impact of the risk adjustment based on its best estimate.
The Company estimates the receivable or payable under the risk adjustment programs based on its estimated risk score compared to the state average risk score. The Company may record a receivable or payable as an adjustment to premium revenues to reflect the year-to-date impact of the risk adjustment based on its best estimate.
The following table summarizes the Company’s membership by offering: As of December 31, Membership by Offering 2024 2023 Individual and Small Group 1,636,400 967,002 Medicare Advantage — 1,781 Cigna+Oscar (1) 40,570 67,500 Total Members (2) 1,676,970 1,036,283 (1) Represents total membership for our co-branded partnership with Cigna.
The following table summarizes the Company’s membership by offering: As of December 31, Membership by Offering 2025 2024 Individual and Small Group 2,042,449 1,636,400 Cigna+Oscar (1) — 40,570 Total Members (2) 2,042,449 1,676,970 (1) Represents total membership for our co-branded partnership with Cigna.
In quota share reinsurance, the reinsurer agrees to assume a specified percentage of the ceding company’s losses in exchange for a corresponding percentage of premiums. In XOL reinsurance, the reinsurer agrees to assume all or a portion of the ceding company’s losses in excess of a specified amount.
In XOL reinsurance, the reinsurer agrees to assume all or a portion of the ceding company’s losses in excess of a specified amount.
Year Ended December 31, (in thousands, except percentages) 2024 2023 Medical $ 7,332,589 $ 4,642,024 Less: Ceded quota share reinsurance claims (1) (2,029) 2,057 Net claims before ceded quota share reinsurance (A) $ 7,334,618 $ 4,639,967 Premium $ 8,971,259 $ 5,686,069 Less: Ceded quota share reinsurance premiums (2) (881) (2,211) Net premiums before ceded quota share reinsurance (B) $ 8,972,140 $ 5,688,280 Medical Loss Ratio (A divided by B) 81.7 % 81.6 % (1) Represents prior period development for claims ceded to reinsurers pursuant to quota share treaties accounted for under reinsurance accounting, which are in runoff (2) Represents prior period development for premiums ceded to reinsurers pursuant to quota share treaties accounted for under reinsurance accounting, which are in runoff.
Year Ended December 31, (in thousands, except percentages) 2025 2024 Medical $ 10,019,025 $ 7,332,589 Less: Ceded quota share reinsurance claims (1) — (2,029) Net claims before ceded quota share reinsurance (A) $ 10,019,025 $ 7,334,618 Premium $ 11,469,893 $ 8,971,259 Less: Ceded quota share reinsurance premiums (2) — (881) Net premiums before ceded quota share reinsurance (B) $ 11,469,893 $ 8,972,140 Medical Loss Ratio (A divided by B) 87.4 % 81.7 % (1) Represents prior period development for claims ceded to reinsurers pursuant to quota share treaties accounted for under reinsurance accounting, which are in runoff (2) Represents prior period development for premiums ceded to reinsurers pursuant to quota share treaties accounted for under reinsurance accounting, which are in runoff.
Our medical and pharmacy costs can also exhibit seasonality depending on selection effects or changes in the risk profile of our membership and the proportion of our membership that is new in the calendar year.
Our medical expenses are also impacted by the number of days and holidays in a given period. Our medical and pharmacy costs can also exhibit seasonality depending on selection effects or changes in the risk profile of our membership and the proportion of our membership that is new in the calendar year.
Cash flows from financing activities include proceeds from the issuance of debt securities and proceeds from stock option exercises. For the year ended December 31, 2024, net cash provided by financing activities was $68.4 million compared to $6.4 million for the same period in 2023.
Cash flows from financing activities may include proceeds from the issuance of debt securities, proceeds from stock option exercises, and tax payments related to the net settlement of share-based awards. For the year ended December 31, 2025, net cash provided by financing activities was $399.2 million compared to $68.4 million for the same period in 2024.
The combined statutory capital and surplus of our health insurance subsidiaries was estimated to be approximately $1,242.7 million as of December 31, 2024, and it was $800.6 million as of December 31, 2023, which was in compliance with and in excess of the minimum capital requirements for each period.
The combined statutory capital and surplus of our Health Insurance Subsidiaries was estimated to be approximately $1.0 billion as of December 31, 2025, and $1.2 billion as of December 31, 2024, respectively, which was in compliance with and in excess of the minimum capital requirements for each period.
The health insurance subsidiaries historically have required capital contributions from Parent to maintain minimum levels. The health insurance subsidiaries in aggregate exceeded the minimum statutory RBC requirement by $301 million as of December 31, 2023 and are projected to have approximately $774 million of excess capital as of December 31, 2024.
The Health Insurance Subsidiaries historically have required capital contributions from Parent to maintain minimum levels. The Health Insurance Subsidiaries in aggregate exceeded the minimum statutory risk-based capital (“RBC”) requirement by $734 million as of December 31, 2024 and are estimated to have approximately $315 million of excess capital as of December 31, 2025.
Upon conversion, the 2031 Notes will be settled, at the Company’s election, in shares of Class A common stock, cash, or a combination of cash and shares of Class A common stock, unless an Initial Purchaser elects to receive the consideration due upon conversion solely in shares of Class A common stock pursuant to the terms of the Investment Agreement.
Upon conversion, we may elect to settle the 2031 Notes in shares of Class A common stock, cash, or a combination of both, unless an Initial Purchaser of the 2031 Notes elects to receive the consideration due upon conversion solely in shares of Class A common stock pursuant to the terms of the Investment Agreement.
Selling, General and Administrative Expenses and SG&A Expense Ratio Selling, general and administrative expenses increased by $329.8 million, or 23%, for the year ended December 31, 2024, compared to the year ended December 31, 2023.
Selling, General, and Administrative Expenses and SG&A Expense Ratio Selling, general, and administrative expenses increased $294.3 million, or 17%, for the year ended December 31, 2025, compared to the year ended December 31, 2024.
During the periods presented in the financial statements contained elsewhere in this Annual Report on Form 10-K, certain regulatory developments have impacted, and may continue to impact, our results of operations. • Enhanced APTC’s that have been in place since 2021 have contributed to increases in our membership.
During the periods presented in the financial statements contained elsewhere in this Annual Report on Form 10-K, certain regulatory developments have impacted, and are expected to continue to impact, our results of operations.
Our risk transfer estimates are subject to a high degree of estimation and variability, and are affected by the relative risk of our members, and in the case of ACA, relative to that of other insurers.
Our risk transfer estimates are subject to a high degree of estimation and variability, and are affected by the relative risk of our members, and in the case of the ACA, that of other insurers. The data we rely upon to calculate these estimates includes data received from independent third parties.
For the year ended December 31, 2024, net cash used in investing activities was $1,387.4 million as compared to $577.2 million net cash provided by investing activities for the same period in 2023. The change was primarily due to an increase in purchases of securities and a lower level of maturing investments.
For the year ended December 31, 2025, net cash used in investing activities was $241.1 million as compared to $1,387.4 million for the same period in 2024. The change was primarily due to a reduction in the purchases of securities.
For additional details, see “Business–Government Regulation–Ongoing Requirements and Changes to the ACA” and “Risk Factors-Most Material Risks to Us-Our success and ability to grow our business depend in part on retaining and expanding our member base.
“Risk Factors-Most Material Risks to Us-Our success and ability to grow our business depend in part on retaining and expanding our member base.
The change was primarily due to higher premiums received, which were partially offset by higher claim disbursements. Cash flows from investing activities primarily include the purchase and disposition of financial instruments.
The increase was primarily due to higher premiums and lower net ceded reinsurance outflows, partially offset by higher claim disbursements, risk adjustment payments, and broker expenses. Cash flows from investing activities primarily include the purchase and disposition of financial instruments.
The Company refines its estimate as new information becomes available. 64 Table of Contents Components of our Results of Operations Premium Premium revenue includes direct policy premiums collected from our members and subsidies received from the federal government, risk adjustment transfers, and assumed policy premiums we earned as part of our reinsurance arrangement under our Cigna+Oscar Small Group plan offering, and is net of ceded premium from XOL and run-off quota share reinsurance contracts accounted for under reinsurance accounting.
For more detail related to the risk adjustment, see “ Note 20 - Risk Adjustment ” to our Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K. 70 Table of Contents Components of Our Results of Operations Premium Premium revenue includes subsidies received from the federal government, direct policy premiums collected from our members (net of risk adjustment transfers), and assumed policy premiums we earned as part of our reinsurance arrangement under our former Cigna+Oscar Small Group plan offering, and is net of ceded premium from XOL and run-off quota share reinsurance contracts accounted for under reinsurance accounting.
The most significant items involving management’s estimates include estimates of benefits payable and risk adjustment. The impact of changes in estimates is recorded in the period in which they become known.
We regularly assess these estimates; however, actual amounts could differ from those estimates. The most significant items involving management’s estimates include estimates of benefits payable and risk adjustment. The impact of changes in estimates is recorded in the period in which the impact becomes known.
Convertible Senior Notes On February 3, 2022, we issued $305.0 million in aggregate principal amount of convertible senior notes due 2031 (the “2031 Notes”) in a private placement to funds affiliated with or advised by Dragoneer Investment Group, LLC, Thrive Capital, LionTree Investment Management, LLC and Tenere Capital LLC (the “Initial Purchasers”).
See “Note 13 – Leases” to our Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K for further detail of our obligations and the timing of expected future payments. 2031 Convertible Senior Notes In February 2022, the Company issued $305.0 million in aggregate principal amount of convertible senior notes due 2031 (the “2031 Notes”) in a private placement to funds affiliated with or advised by Dragoneer Investment Group, LLC, Thrive Capital, LionTree Investment Management, LLC and Tenere Capital LLC, (the “Initial Purchasers”).
Critical Accounting Policies and Estimates The preparation of Consolidated Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of revenues, expenses, assets, and liabilities and disclosure of contingent assets and liabilities in our financial statements. We regularly assess these estimates; however, actual amounts could differ from those estimates.
Critical Accounting Policies and Estimates The preparation of Consolidated Financial Statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of revenues, expenses, assets, and liabilities, and disclosure of contingent assets and liabilities in our financial statements.
Medical expense also reflects the net impact of our ceded reinsurance claims from XOL and run-off quota share reinsurance contracts accounted for under reinsurance accounting. Selling, General and Administrative Expenses Selling, general and administrative expenses primarily include distribution expenses, wages, benefits, costs of software and hardware, the impact of quota share reinsurance, stock-based compensation, and other administrative costs.
Medical expense also reflects the net impact of our ceded reinsurance claims from XOL and run-off quota share reinsurance contracts accounted for under reinsurance accounting.
As of December 31, 2024 and December 31, 2023, total cash and cash equivalents and investments held by the holding company was $189.8 million and $234.1 million, respectively, of which $12.8 million and $12.6 million was restricted for 2024 and 2023, respectively.
As of December 31, 2025 and December 31, 2024, total cash and cash equivalents and investments held by these entities was $414.2 million and $189.8 million, respectively, of which $14.7 million and $12.8 million was restricted as of December 31, 2025 and 2024, respectively.
SEP Market Dynamics SEP or other market dynamics that drive enrollment and/or mix changes throughout the year may impact the per member levels of premiums, claims, and/or risk adjustment transfers. During the year ended December 31, 2024, the increase in membership was due in part to an increase in member enrollments through SEP which impacted our MLR.
SEP Market Dynamics, Developments, and Trends During the year ended December 31, 2024, the increase in our membership was due in part to an increase in member enrollments through SEP which impacted our MLR.
The impact of the federal risk adjustment program is included in the denominator of our MLR. We believe MLR is an important metric to demonstrate the ratio of our costs to pay for healthcare of our members to the net premium before ceded quota share reinsurance.
We believe MLR is an important metric to demonstrate the ratio of our costs to pay for the healthcare of our members to the net premium before ceded quota share reinsurance. SG&A Expense Ratio The SG&A expense ratio reflects the Company’s selling, general, and administrative expenses, as a percentage of Total revenue (net of risk adjustment transfers).
Recent Developments, Trends and Other Key Factors Impacting Performance Regulatory Update Our operations are subject to comprehensive and detailed federal, state, and local laws and regulations throughout the jurisdictions in which we do business. Developments related to the regulatory regimes in which we operate have in the past impacted, and are expected to continue to impact, our results of operations.
Recent Developments, Trends and Other Key Factors Impacting Performance Regulatory Update Our operations are subject to comprehensive and detailed federal, state, and local laws and regulations, which continue to rapidly evolve and change.
During the second half of 2024 CMS enacted new measures to respond to increases in unauthorized changes in consumer enrollments by agents and brokers and to reduce consumer burdens related to unauthorized enrollments, and these measures may make it more difficult for members to enroll in new plans or switch from one plan to another or otherwise retroactively remove members from ACA plans.
During the second half of 2024, CMS enacted new measures to respond to increases in unauthorized changes in consumer enrollments by agents and brokers and to reduce consumer burdens related to unauthorized enrollments.
For more detail related to our medical claims expenses, see Note 2 - Summary of Significant Accounting Policies to our Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K.
For more detail related to our medical claims expenses, see “Note 2 - Summary of Significant Accounting Policies” to our Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K. Risk Adjustment The risk adjustment programs in the markets we serve are designed to mitigate the potential impact of adverse selection and provide stability for health insurers.
Services and Other Services and other revenue includes primarily revenue earned from administrative services performed as part of the +Oscar platform, as well as sublease income. Medical Medical expense primarily consists of both paid and unpaid medical expenses incurred to provide medical services and products to our members.
Other Revenues Other revenues include revenue earned through brokerage, enhanced direct enrollment (“EDE”) platform, and market education services, fees for services performed via the +Oscar platform, revenue sharing from virtual credit card rebates, and sublease income. Medical Medical expense primarily consists of both paid and unpaid medical expenses incurred to provide medical services and products to our members.
There is a higher degree of uncertainty associated with estimates of risk adjustment transfers at the beginning of the policy year resulting from composition of the risk score being based on concurrent claim data.
There is a higher degree of uncertainty associated with estimates of risk adjustment transfers earlier in the policy year or, in the case of SEP driven enrollment, throughout the policy year, resulting from the fact that risk scores are based on lagged claim data.
Our medical expenses are impacted by seasonal effects of medical costs, such as the utilization of deductibles and out-of-pocket maximums over the course of the policy year, which shift more costs to us in the second half of the year as we pay a higher proportion of covered claims costs, and the number of days and holidays in a given period.
Actual risk adjustment calculations and transfers have in the past materially differed, and could materially differ in the future, from our assumptions. 67 Table of Contents Claims Incurred Our medical expenses are impacted by unit costs and utilization, as well as seasonal effects on medical costs, as members pay their contractual claims portion of claims responsibility, meeting their deductibles and out-of-pocket maximums over the course of the policy year, which shift more costs to us in the second half of the year as we pay a higher proportion of covered claims costs.
Net income (loss) attributable to noncontrolling interests Net income (loss) attributable to noncontrolling interests represents the share of the Company’s earnings allocated to the Company’s joint venture partner. 65 Table of Contents Results of Operations Year Ended December 31, 2024 compared to Year Ended December 31, 2023 The following table sets forth our results of operations for the periods indicated: Year Ended December 31, (in thousands, except percentages) 2024 2023 Revenue Premium $ 8,971,259 $ 5,686,069 Investment income 185,729 155,447 Services and other 20,576 21,353 Total revenue 9,177,564 5,862,869 Operating Expenses Medical 7,332,589 4,642,024 Selling, general, and administrative 1,755,565 1,425,766 Depreciation and amortization 32,145 30,694 Total operating expenses 9,120,299 6,098,484 Earnings (loss) from operations 57,265 (235,615) Interest expense 23,734 24,603 Other expenses (income) 105 7,082 Earnings (loss) before income taxes 33,426 (267,300) Income tax expense 7,305 3,294 Net income (loss) 26,121 (270,594) Less: Net income (loss) attributable to noncontrolling interests 689 134 Net income (loss) attributable to Oscar Health, Inc. $ 25,432 $ (270,728) Medical Loss Ratio (MLR) 81.7 % 81.6 % SG&A Expense Ratio 19.1 % 24.3 % Adjusted EBITDA (1) $ 199,234 $ (45,238) (1) Adjusted EBITDA is a non-GAAP measure.
Our deferred tax assets and liabilities are calculated by applying the current tax rates and laws to taxable years in which such differences are expected to reverse. 71 Table of Contents Net income (loss) Attributable to Noncontrolling Interests Net income (loss) attributable to noncontrolling interests represents the share of the Company’s earnings allocated to the Company’s joint venture partner. 72 Table of Contents Results of Operations Year Ended December 31, 2025 compared to Year Ended December 31, 2024 The following table sets forth our results of operations for the periods indicated: Year Ended December 31, (in thousands, except percentages) 2025 2024 Revenue Premium $ 11,469,893 $ 8,971,259 Investment income 202,941 185,729 Other revenues 28,593 20,576 Total revenue 11,701,427 9,177,564 Operating Expenses Medical 10,019,025 7,332,589 Selling, general, and administrative 2,049,867 1,755,565 Depreciation and amortization 28,892 32,145 Total operating expenses 12,097,784 9,120,299 Earnings (loss) from operations (396,357) 57,265 Interest expense 17,601 23,734 Other expenses 23,339 105 Earnings (loss) before income taxes (437,297) 33,426 Income tax expense 5,606 7,305 Net income (loss) (442,903) 26,121 Less: Net income attributable to noncontrolling interests 248 689 Net income (loss) attributable to Oscar Health, Inc. $ (443,151) $ 25,432 Medical Loss Ratio (MLR) 87.4 % 81.7 % SG&A Expense Ratio 17.5 % 19.1 % Premium Premium revenue increased $2,498.6 million, or 28% , for the year ended December 31, 2025, compared to the same period in 2024.
We regularly review our Total Revenue, MLR, Selling, General and Administrative Expense Ratio (“SG&A Expense Ratio”), Net Income (loss) attributable to Oscar Health Inc., and Adjusted EBITDA, a non-GAAP financial metric, to evaluate our business, measure our performance, identify trends in our business, prepare financial projections, and make strategic decisions.
These assets include Lucie, Inc., a direct enrollment technology platform; IHC Specialty Benefits, Inc., an individual market brokerage; and Healthinsurance.org, LLC, a consumer education website. 64 Table of Contents We regularly review our Total revenue, Medical Loss Ratio (“MLR”), Selling, general, and administrative expense ratio (“SG&A expense ratio”), Earnings (loss) from operations, and Net income (loss) attributable to Oscar Health, Inc. to evaluate our business, measure our performance, identify trends in our business, prepare financial projections, and make strategic decisions.
We believe Total revenue is an important metric to assess the growth of our business, as well as the earnings potential of our investment portfolio. MLR MLR is a metric used to calculate medical expenses as a percentage of net premiums before ceded quota share reinsurance.
Total Revenue Total revenue includes Premium revenue (net of risk adjustment transfers), Investment income, and Other revenues. We believe Total revenue is an important metric to assess the growth of our business, as well as the earnings potential of our investment portfolio.
Higher SEP growth in certain markets throughout 2024 may have contributed to the increase in our risk transfer payable for the year ended December 31, 2024. We currently anticipate lower SEP membership growth during 2025.
Higher SEP growth in certain markets throughout 2024 contributed to the increase in our risk transfer payable for the years ended December 31, 2024 and December 31, 2025. Reinsurance We believe our reinsurance agreements help us achieve important goals for our business, including risk management and capital efficiency.
Upon the occurrence of a fundamental change (as defined in the Indenture), holders of the 2031 Notes have the right to require us to repurchase all or some of their 2031 Notes for cash, subject to certain conditions.
The 2030 Notes will mature on September 1, 2030, unless they are earlier repurchased, redeemed, or converted. 77 Table of Contents The holders of the 2030 Notes may require us to repurchase the 2030 Notes for cash, upon a fundamental change (as defined in the 2030 Indenture), subject to certain conditions.
On or after December 31, 2026, if a Class A common stock sale price condition is satisfied, we are able to redeem all (but not less than all) of the 2031 Notes for cash.
In addition, we may redeem the 2031 Notes on or after December 31, 2026 if certain Class A common stock sales price and other conditions are satisfied.
Our investment policies are designed to provide liquidity, preserve capital, and optimize the total return on invested assets. These policies also align with the constraints of our credit agreement and state regulations governing the types of investments our health insurance subsidiaries can hold.
These policies also align with the constraints of state regulations governing the types of investments our subsidiaries can hold.
We believe the SG&A Expense Ratio is useful to evaluate our ability to manage our overall selling, general, and administrative cost base. Net Income (loss) attributable to Oscar Health, Inc. Net earnings (loss) allocated to the Company after income (loss) attributable to noncontrolling interests.
Net Income (Loss) Attributable to Oscar Health, Inc. Net income (loss) attributable to Oscar Health, Inc. is Net earnings (loss) allocated to the Company after net income (loss) attributable to noncontrolling interests.
The 2031 Notes bear interest at a rate of 7.25% per annum, payable in cash, semi-annually in arrears on June 30 and December 31 of each year, commencing on June 30, 2022. The 2031 Notes will mature on December 31, 2031, subject to earlier repurchase, redemption, or conversion.
As discussed further below, in connection with the Exchange Agreement and the related transactions, as of November 5, 2025, the debt covenants in the Investment Agreement, as amended, were extinguished, and the 2030 Notes ceased to be subordinated to the 2031 Notes. 76 Table of Contents The 2031 Notes bear interest at a rate of 7.25% per annum, payable in cash, semi-annually in arrears on June 30 and December 31 of each year, commencing on June 30, 2022.
In developing our benefits payable estimates, we apply different estimation methods depending on the month for which incurred claims are being estimated.
Healthcare costs in the years ended December 31, 2025 and 2024 included favorable healthcare claim development related to prior years, net of reinsurance of $239.5 million and $164.7 million, respectively. In developing our benefits payable estimates, we apply different estimation methods depending on the month for which incurred claims are being estimated.
SEP or other market dynamics that drive enrollment and/or mix changes throughout the year may impact the per member levels of premiums, claims, and/or risk adjustment transfers. Additionally, medical expenses have historically been highest towards the second half of the year due to a number of factors discussed above.
SEP or other market dynamics that drive enrollment and/or mix changes throughout the year may impact the per member levels of premiums, claims, and/or risk adjustment transfers. For more information on how our member enrollment and medical expenses are affected by seasonality, see “Recent Developments, Trends and Other Key Factors Impacting Performance–Members” and “–Claims Incurred” above.
The Amended Credit Agreement provides for a revolving loan credit facility (the “Revolving Credit Facility”) in the aggregate principal amount of $115 million, with proceeds to be used for general corporate purposes. Borrowings under the Revolving Credit Facility bear interest equal to, at our option, one of two variable rates plus an applicable margin.
The 2021 Amended Credit Agreement provided for a revolving loan credit facility (the “2021 Revolving Credit Facility”) in the aggregate principal amount of $115.0 million, with proceeds to be used for general corporate purposes of the Company. On September 18, 2025, we terminated the 2021 Revolving Credit Facility.
For the most recent two months, the completion factors are informed primarily from forecasted per member per month claims projections developed from our historical experience and adjusted by emerging experience data in the preceding months which may include adjustments for known changes in estimates of recent hospital and drug utilization data, provider contracting changes, changes in benefit levels, changes in member cost sharing, changes in medical management processes, product mix, and workday seasonality. 63 Table of Contents The following table illustrates the sensitivity of the estimated potential impact on our benefits payable estimates gross of reinsurance, for those periods as of December 31, 2024 to an increase (decrease) in the underlying completion factors: Changes in Estimates Increase (Decrease) in Benefits Payable (in thousands) (1.00)% $ 172,729 (0.75)% 129,221 (0.50)% 85,931 (0.25)% 42,858 0.25% (42,644) 0.50% (85,076) 0.75% (126,673) 1.00% (165,622) Management believes the amount of benefits payable is reasonable and adequate to cover our liability for unpaid claims as of December 31, 2024; however, actual claim payments may differ from established estimates as discussed above.
For the most recent two months, the completion factors are informed primarily from forecasted per member per month claims projections developed from our historical experience and adjusted by emerging experience data in the preceding months which may include adjustments for known changes in estimates of recent hospital and drug utilization data, provider contracting changes, changes in benefit levels, changes in member cost sharing, changes in medical management processes, product mix, and workday seasonality.
There is additional uncertainty for both markets and blocks of business that experience outsized growth, compounded by the lack of credible experience data on the newly enrolling population. Furthermore, there 61 Table of Contents is also uncertainty associated with changes in other carriers operations, which may impact the ultimate degree of market level risk.
Furthermore, there is also uncertainty associated with changes in other carriers’ operations, which may impact the ultimate degree of market-level risk.
Our technology drives superior experiences, deep engagement, and high-value clinical care, earning us the trust of approximately 1.68 million effectuated members, as of December 31, 2024.
Our technology drives superior experiences, deep engagement, and high-value clinical care, earning us the trust of approximately 2.0 million effectuated members (“members”) as of December 31, 2025. Effectuated members are those who are actively enrolled in one of the Company’s plans and whose required premium payments have either been made or are within the payment grace period.
Membership may change due to our expansion into or exiting of certain markets, and further vary throughout the year due to disenrollments, any SEP, and other market dynamics that are in effect such as Medicaid redeterminations, enhancements, reductions or eliminations of APTCs, other legislative or regulatory actions, or other factors that enable the overall market to grow or decline throughout the year.
Membership may change due to the pricing of, and benefits offered under, our plans both relative to our competitors and considered on a stand-alone basis and our expansion into or exiting from certain markets. Membership may vary throughout the year due to disenrollments, SEP, and other market dynamics that are in effect.
During the year ended December 31, 2024 and 2023, the Parent received approximately $133 million and $52 million capital distribution, respectively, from the insurance subsidiaries.
During the years ended December 31, 2025 and 2024, the Parent received approximately $25.0 million and $133.0 million in capital distributions and loan repayments, respectively, from the Health Insurance Subsidiaries. For additional information see Part I, Item 1A.
The increase was primarily due to proceeds received from the exercise of stock options. 72 Table of Contents
The increase was primarily due to proceeds from the issuance of new convertible notes net of capped call transactions. 79 Table of Contents
See Note 13 – Leases to our Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K for further detail of our obligations and the timing of expected future payments.
For more information on our 2030 Notes, including details relating to repurchase, redemption and conversions of the 2030 Notes, and the Capped Call Transactions, see “Note 9 - Debt” to our Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K.
The majority of the assets held by the holding company are in the form of cash and cash equivalents and investments.
(on a standalone basis “Parent”), together with subsidiaries excluding our Health Insurance Subsidiaries. The majority of the assets held by our entities other than our Health Insurance Subsidiaries are in the form of cash and cash equivalents and investments.
(2) A member covered under more than one of our health plans counts as a single member for the purposes of this metric. 66 Table of Contents Investment Income Investment income increased by $30.3 million, or 19% , for the year ended December 31, 2024, compared to the same period in 2023, primarily due to a larger asset base.
Investment Income Investment income increased $17.2 million, or 9%, for the year ended December 31, 2025, compared to the same period in 2024, primarily due to a larger asset base, partially offset by lower yields. 73 Table of Contents Medical Expenses and MLR Medical expenses increased $2,686.4 million, or 37%, for the year ended December 31, 2025, compared to the year ended December 31, 2024, primarily due to increased membership and medical cost trend.
Risk Adjustment The risk adjustment programs in the individual and small group markets we serve are designed to mitigate the potential impact of adverse selection and provide stability for health insurers. Plans with lower than average risk scores will generally pay into the pool, while plans with higher than average risk scores will generally receive distributions.
Plans with lower than average risk scores will generally pay into the pool, while plans with higher than average risk scores will generally receive distributions. Plans receive higher payments for members with higher risk scores than members with lower risk scores.
If we call any of the 2031 Notes for redemption, holders of the 2031 Notes shall have the right to convert any such 2031 Note any time before the close of business on the second business day immediately before the related redemption date. 70 Table of Contents The 2031 Notes may be converted at the option of the holders, on or after August 31, 2031, if we call the 2031 Notes for redemption, upon the satisfaction of a Class A common stock sale price or 2031 Note trading price condition, or upon certain corporate events.
The 2031 Notes may be converted at the election of the holders under certain circumstances, including if we call the 2031 Notes for redemption or upon satisfaction of a Class A common stock sale price condition. During the quarterly period ended December 31, 2025, the Class A common stock sale price condition was satisfied.
For additional details, see “Business–Government Regulation–Ongoing Requirements and Changes to the ACA” and “Risk Factors–Most Material Risks to Us–Failure to accurately estimate our incurred medical expenses or effectively manage our medical costs or related administrative costs could negatively affect our financial position, results of operations, and cash flows.” • The CMS has recently been increasingly focused on improving integrity in the eligibility and enrollment process, and we expect this focus to continue.
“Risk Factors-Most Material Risks to Us-Failure to accurately estimate our incurred medical expenses or overall market morbidity, or effectively manage our medical costs or related administrative costs could negatively affect our financial position, results of operations, and cash flows” and “Risk Factors-Risks Related to the Regulatory Framework That Governs Us-Changes in laws, regulations or rules relating to taxes or tariffs could adversely affect us.” Members Our membership is measured as of a particular point in time.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeInterest rate risk is highly sensitive due to many factors, including U.S. monetary and tax policies, U.S. and international economic factors, and other factors beyond our control. Assuming a hypothetical and immediate 1% increase in interest rates at December 31, 2024, the fair value of our investments would decrease by approximately $39.6 million .
Biggest changeInterest rate risk is highly sensitive due to many factors, including U.S. monetary and tax policies, U.S. and international economic factors, and other factors beyond our control. Assuming a hypothetical and immediate 1% increase in interest rates at December 31, 2025, the fair value of our investments would decrease by approximately $44.4 million.
Any declines in interest rates over time would reduce our investment income. 73 Table of Contents
Any declines in interest rates over time would reduce our investment income. 80 Table of Contents

Other OSCR 10-K year-over-year comparisons