(Bloomberg) — Startup Oscar Health Insurance Corp. lost $105.2 million in its New York and New Jersey businesses last year, a sign that insurers of all sizes are struggling in the new markets created by the Patient Protection and Affordable Care Act (PPACA).
The losses, $92.4 million in New York and $12.8 million in New Jersey, were disclosed by Oscar in filings with state regulators. Chief Executive Officer Mario Schlosser said some of Oscar’s losses stem from the cost of starting a new health insurer. Others are tied to the same problems befalling bigger health plans: costlier customers and a shortfall in a key government program.
Schlosser said last month that Oscar is adjusting its strategy to limit costs as it enters new markets in California and Texas. The insurer — valued at $2.7 billion in its latest round of funding, according to a person familiar with the matter — has struck deals with limited groups of hospitals and doctors, rather than offering broad networks like traditional insurers. Oscar has also been narrowing its network in New York, and Schlosser said the company is getting better prices for some services as its membership increases.
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