Oscar Health Inc. (NYSE: OSCR), a health insurance company established by Joshua Kushner and financially supported by Jared Kushner, experienced a strong uptick in its stock price during after-hours trading on Thursday. The shares advanced by 6.69%, reaching $18.04 each. During the regular trading session earlier that day, the stock increased by 2.55%, closing at $16.90 per share, according to Benzinga Pro data.
Market enthusiasm followed the U.S. House of Representatives' passage of legislation extending healthcare subsidies under the Affordable Care Act for an additional three years. This legislative move is intended to alleviate escalating health insurance premium costs for millions of Americans. It also provides significant support to insurance providers like Oscar Health, whose operations are heavily concentrated in the ACA individual exchange market.
This extension is particularly consequential for Oscar Health because without continued subsidies, the company’s policyholders would have faced considerable premium hikes. Such increases might have led subscribers, including healthier individuals, to discontinue their coverage. That scenario posed a substantial threat to Oscar's core business model, which relies on stable membership levels within the ACA exchanges. In contrast, larger and more diversified insurers like UnitedHealth Group Inc. (NYSE: UNH) have business models less sensitive to changes in the ACA subsidy framework.
Oscar Health's stock has demonstrated positive momentum throughout the year, up 16.71% year-to-date. This recent surge builds upon gains from earlier in the week, which coincided with Barclays raising the stock’s rating from “Underweight” to “Equal-Weight” and adjusting the price target upwards to $18 per share from a previous $13.
Despite these positive developments in price trends over both short and long-term periods, the company’s shares show less strength in momentum metrics according to Benzinga’s Edge Stock Rankings. Nevertheless, the combined effects of favorable pricing trends and policy clarity have enhanced the outlook for Oscar Health.
Oscar Health's business concentration in the individual ACA exchange market makes legislative support in this area highly impactful on its valuation and prospects. By extension, the stability afforded by the subsidy bill facilitates more predictable premium pricing for consumers, which underpins customer retention and revenue stability for the insurer.
The stock price performance and analyst upgrades reflect investor confidence tied closely to regulatory developments. Oscar Health remains positioned with a specific market focus that creates distinctive sensitivity to changes in healthcare policy, particularly those affecting the Affordable Care Act.