Oscar Health's Q2 2025: Key Contradictions in Risk Adjustments, Membership Trends, and Market Positioning

Risk adjustment payable as a percentage of revenue, future membership trends, risk adjustment payable as a percentage of premiums, and market stability and competitive positioning are the key contradictions discussed in Oscar Health's latest 2025Q2 earnings call.



Revenue and Membership Growth:
- Oscar Health, Inc. reported total revenue of $2.9 billion for Q2 2025, a 29% increase year-over-year.
- Membership grew by 28% year-over-year, reaching more than 2 million members.
- The growth was driven by strong retention, above-market growth during open enrollment, and continuing SEP member additions.

Medical Loss Ratio (MLR) and Risk Adjustment Payable:
- The second-quarter medical loss ratio (MLR) increased by 12 points year-over-year to 91.1%.
- This increase was primarily due to a $316 million increase to the risk adjustment payable for 2025.
- The rise in MLR was attributed to higher average market morbidity, driven by the entry of consumers into the individual market for Medicaid redeterminations and healthier, low-utilizing consumers leaving the market.

Financial Performance and Guidance:
- Oscar reported a loss from operations of $230 million and an adjusted EBITDA loss of $199 million for Q2 2025.
- The company reaffirmed its updated 2025 guidance, including revenue of $12 billion to $12.2 billion and a loss from operations of $200 million to $300 million.
- The guidance was revised based on better-than-expected retention and higher SEP member additions, amidst a market-wide shift towards higher average market morbidity.

Strategic Initiatives for Market Stability:
- Oscar is implementing a series of strategic steps to address market instability, including submitting 2026 rate filings and partnering with consumer brands to expand its market reach.
- The company is focused on stabilizing the market in 2026 by addressing morbidity pressure and the effects of program integrity efforts through rate increases.
- These initiatives are aimed at ensuring a return to profitability in 2026 and long-term growth.