What Happened?
Shares of health insurance company Oscar Health (NYSE: OSCR) fell 7.8% in the afternoon session after a rival, Molina Healthcare, slashed its profit forecast, citing rising medical costs and sparking sector-wide concerns. Molina cut its 2025 adjusted profit outlook from a previous target of $19 per share to about $14, attributing the change to "unprecedented" medical claims in its ACA Marketplace plans. The company noted that competitors, including Oscar Health, faced similar cost pressures. This news caused a ripple effect across the industry, with Molina's stock plunge leading declines for other ACA-focused insurers. Oscar's shares fell as investors grew worried about the impact of these elevated costs on the company's own profitability.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Oscar Health? Access our full analysis report here.
What Is The Market Telling Us
Oscar Health’s shares are extremely volatile and have had 69 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 2 days ago when the stock gained 3% on the news that the company announced it was expanding its health insurance coverage and introducing new AI-powered tools and specialized health plans for the 2026 open enrollment period. The company revealed its health plans would become available in 573 counties across 20 states, with new expansions into Alabama and Mississippi. To improve the customer experience, Oscar launched a personal AI agent named Oswell, powered by OpenAI, to provide members with on-demand support. The company also introduced several new offerings, including what it described as the first-ever menopause-focused plan in the individual market, called HelloMeno. The plan offered benefits such as $0 primary doctor visits and the potential for members to save up to $900 a year. A new digital rewards program, Oscar Unlocks, was also introduced to promote healthy actions.
Oscar Health is up 35.8% since the beginning of the year, but at $18.40 per share, it is still trading 18.1% below its 52-week high of $22.47 from October 2025. Investors who bought $1,000 worth of Oscar Health’s shares at the IPO in March 2021 would now be looking at an investment worth $528.68.
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