Health insurance startup Oscar Health raised $165 million in its latest funding round.
Oscar Health co-founders Mario Schlosser and Joshua Kushner announced the funding in a March 27 blog post. Founders Fund's Brian Singerman led the round, with other investors including Alphabet's CapitalG investment branch and its Verily Life Sciences arm.
"Bolstered by new partnerships with industry leaders, such as Cleveland Clinic, Humana, and AXA, Oscar now has a proven, replicable growth playbook: secure competitive prices with new health systems, acquire and engage membership in significant volumes, build market share for our provider partners, and begin to drive healthcare costs down," the co-founders wrote. They added Oscar hopes to "expand at a rate of 4-5 cities every year, in individual, small group, and other market segments."
Cleveland Clinic teamed up with Oscar Health for a co-branded health plan in June 2017. They recently estimated their new plan holds 15 percent of Cleveland's health insurance market after enrolling 11,000 members for 2018. Oscar Health and Humana also linked up to offer small employer health plans in Nashville, Tenn., in July 2017.
Oscar generated an underwriting profit in 2017 and expects $1 billion in gross premium revenue for 2018, but it's been a rocky start for the insurer. Oscar retreated from certain ACA markets in 2016 after losing $115 million in 2015. It also posted a $57.6 million loss in the first half of fiscal year 2017, narrowing its $83 million loss recorded in the same period a year prior.
The startup's value jumped to $3.2 billion after the funding round, sources familiar with the matter told CNBC. That's up from $2.7 billion reported in 2016.
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