Oscar Health, Inc. · NYSE:OSCR
Oscar Health — Q2 2021 Earnings Presentation
13 slides from Oscar Health's earnings presentation, Aug 12, 2021
Slide 1: Oscar Health, Inc. Second Quarter 2021 Earnings Presentation
HIOSCAR.COM Oscar Health, Inc. Second Quarter 2021 Earnings Presentation August 12, 2021
Slide 2: Safe Harbor Statement and Forward-Looking Statements
HIOSCAR.COM 2 Safe Harbor Statement and Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact contained herein are forward-looking statements
Slide 3: Continued Strong YoY Membership Growth in 2Q21
HIOSCAR.COM 3 Continued Strong YoY Membership Growth in 2Q21 ● Total quarter end membership increased 35% YoY to 563,100 in 2Q21 from 417,500 in 2Q20 ● Membership growth was primarily driven by growth in the Individual book of business during the Open Enrollment and Special Enrollment Periods, as we
Slide 4: 44% Premium Growth Continues to Exceed Membership Growth
HIOSCAR.COM 4 44% Premium Growth Continues to Exceed Membership Growth ● Direct and Assumed Policy Premiums increased 45% YoY driven by membership growth and business mix shift to higher premium Silver and MA plans Direct and Assumed Policy Premiums (millions) +45%
Slide 5: 2Q21 Premiums Earned Up ~5x, Driven by Membership, Risk Adjustment, and Lower Quota Share
HIOSCAR.COM 5 2Q21 Premiums Earned Up ~5x, Driven by Membership, Risk Adjustment, and Lower Quota Share Premiums Earned (millions) 2Q21 Premiums Walk (millions) 332% Quota Share as % of Premiums before Ceded: 76% 33% +364% ($196M)
Slide 6: 2Q21 Quota Share Cessation Rate Sits at 33%
HIOSCAR.COM 6 2Q21 Quota Share Cessation Rate Sits at 33% ● We've further reduced our use of quota share reinsurance ● Quota share cession rate was 33% in 2Q21, compared with 43% in 1Q21, 77% in FY20 and 55% in FY19 Quota Share as % of Premiums before Ceded Reinsurance
Slide 7: 2Q21 and 1H21 MLR Impacted by COVID-19 Variance
HIOSCAR.COM 7 2Q21 and 1H21 MLR Impacted by COVID-19 Variance ● 2Q21 MLR of 82.4% driven higher YoY due to significant COVID-19 driven deferral of care in 2Q20 ● Direct COVID-19 costs of ~$35M or ~500bps ● Non-COVID-19 utilization slightly above baseline in 2Q21 ● Pre-2021 PPD of $34M in 2Q21 2Q21 M
Slide 8: 2Q21 and 1H21 Admin Ratio Meaningfully Improved
HIOSCAR.COM 8 2Q21 and 1H21 Admin Ratio Meaningfully Improved ● 2Q21 InsuranceCo Administrative Expense Ratio of 19.8% decreased ~330bps YoY ● Decrease driven by increased operating leverage from higher revenue, scale efficiencies from our technology stack, and the repeal of the HIF 2Q21 InsuranceCo
Slide 9: 2Q21 Combined Ratio Driven Higher by COVID-19 Impact
HIOSCAR.COM 9 2Q21 Combined Ratio Driven Higher by COVID-19 Impact 2Q21 Combined Ratio 1H21 Combined Ratio ● 1H21 InsuranceCo Combined Ratio of 98.5% reflects consolidated profit across the insurance subsidiaries ● Increase YoY driven by MLR changes including significantly depressed utilization from
Slide 10: 2Q21 Adj. EBITDA Loss Increased due to COVID-19 Variance
HIOSCAR.COM 10 2Q21 Adj. EBITDA Loss Increased due to COVID-19 Variance 2Q21 Adjusted EBITDA 1H21 Adjusted EBITDA ● 1H21 Adjusted EBITDA loss of ($77M) decreased $38M YoY ● Improvement YoY driven by overall higher membership and premium volume, improved Administrative Expense Ratio, and lower quota
Slide 11: Full-Year 2021 Outlook
HIOSCAR.COM 11 Full-Year 2021 Outlook Low Direct & Assumed Policy Premiums $3,200M Medical Loss Ratio 85.0% InsuranceCo Admin Ratio 21% Combined Ratio 107% High $3,300M 87.0% 22% 109% Adjusted EBITDA(1) ($380M) ($350M) (1) Oscar has not provided a quantitative reconciliation of forecasted Adjusted E
Slide 12: Appendix: Adjusted EBITDA GAAP Reconciliation (Three Months)
HIOSCAR.COM 12 Appendix: Adjusted EBITDA GAAP Reconciliation June 30, 2021* June 30, 2020* Net loss $ (73,068) $ (40,944) Interest expense 228 - Income tax expense 589 1,593 Depreciation and amortization 3,587 2,521 Stock-based compensation/warrant expense 18,273 8,009 Adjusted EBITDA $ (50,391) $ (
Slide 13: Appendix: Adjusted EBITDA GAAP Reconciliation (Six Months)
HIOSCAR.COM 13 Appendix: Adjusted EBITDA GAAP Reconciliation June 30, 2021* June 30, 2020* Net loss $ (160,439) $ (137,823) Interest expense 3,925 - Income tax expense 1,554 2,524 Depreciation and amortization 6,990 5,065 Stock-based compensation/warrant expense 50,244 15,245 Other non-recurring ite