Oscar Health Q3: $167M Profit and Third Raise to 2026 Outlook

Oscar Health, the health insurer focused on individual and small group plans, reported net income of $167.3 million for the third quarter of 2026, or $0.49 a diluted share. In the same quarter a year earlier it lost $137.5 million, or $0.53 a share. Revenue was $5.14 billion against $2.99 billion. The company also raised its full-year guidance for the third time this year. This article explains the numbers in Oscar's earnings release, filed with the US Securities and Exchange Commission, what a large risk adjustment benefit means for how to read them, and what it may signal for people who buy health coverage on their own. It is a summary of company-reported results and not investment advice.

The quarter in numbers

Earnings from operations were $178.0 million, against a loss of $129.3 million in the third quarter of 2025. Adjusted EBITDA, a non-GAAP measure, was $206.9 million against a loss of $101.5 million. The medical loss ratio, which is the share of premium revenue spent on medical care, was 84.0% against 88.5%. For the first nine months the ratio was 78.1% against 84.8%. The SG&A expense ratio, which measures administrative and selling costs, was 14.0% against 17.5%, and 14.4% for nine months against 17.3%.

Revenue for the nine months was $14.67 billion against $8.90 billion. Effectuated members, meaning people whose coverage is in force and paid for, were 2,691,885 at September 30, 2026, all in Individual and Small Group, against 2,116,904 a year earlier. Those figures show a business that grew its membership by more than a quarter while its revenue grew by more than two thirds in the quarter, which is consistent with higher premiums per member alongside the added members, although the release does not break that out.

The risk adjustment effect

The most important detail for interpreting the quarter is risk adjustment. This is a program in the Affordable Care Act marketplace that transfers money among insurers depending on the health of the people they cover. An insurer with healthier members pays into the system and one with sicker members receives money. Insurers must estimate these transfers during the year, and the estimates change as more data arrive.

Oscar's release says third-quarter revenue included a $250 million benefit from updated risk adjustment estimates. Without that item, the third quarter would have looked very different, a point that some coverage of the results highlighted. The release reports that risk adjustment transfers were $677.3 million in the quarter against $727.5 million a year earlier, and $2.99 billion for nine months against $1.79 billion. The net risk adjustment payable at September 30 was $2.99 billion against $1.68 billion a year earlier. A payable is money the company expects to owe, which is why the size of the liability and the changes in estimate matter.

The release also reports favorable development of prior-period medical costs of $42 million in the quarter, against $84 million in the third quarter of 2025. Favorable development means claims for earlier periods came in lower than the company had reserved, which adds to income.

Cash, investments and cash flow

Cash and cash equivalents were $4.47 billion at September 30, 2026, up from $2.77 billion at the end of 2025 and $2.15 billion a year earlier. Short-term investments were $3.02 billion and long-term investments were $1.44 billion. Operating cash flow for nine months was $3.51 billion against $0.42 billion a year earlier. Large cash balances in a health insurer partly reflect premiums received before claims are paid and obligations such as the risk adjustment payable, so the figures should not be read as free cash.

Guidance raised again

Oscar updated its 2026 outlook. Revenue is now expected at $19.0 billion to $19.3 billion, up from $18.7 billion to $19.0 billion. The medical loss ratio is expected at 80.5% to 81.5%, against 81.0% to 82.0% before. The SG&A ratio is expected at 15.1% to 15.6%, against 15.6% to 16.1%. Earnings from operations are expected at $850 million to $950 million, against $600 million to $800 million. The chief executive said this was the third increase in the earnings outlook. The release does not give a full-year net income forecast.

Looking toward 2027

The company said its pricing, products and technology position it to grow market share and expand margins in 2027, but gave no numeric targets. The forward-looking statements point to several policy factors that could change results: the federal rules for 2027 benefit and payment parameters, the expiration of enhanced advance premium tax credits, and possible funding for cost-sharing reductions. Those items affect how much people pay for marketplace coverage and how many sign up, which feeds directly into an insurer's membership and the health of its risk pool.

How to read it

A strong quarter with a large one-time-style estimate change is not the same as a steady run rate. The medical loss ratio and expense ratio improvements are real and are consistent across the nine months, which suggests better underlying results than a year earlier. At the same time, a $250 million estimate change is large relative to $167.3 million of net income, so investors and observers will watch whether later quarters confirm the estimates. Risk adjustment is also settled with final data later, so estimates can move again.

What it means for consumers

For people who buy their own coverage, insurer profit does not translate directly into lower premiums. Premiums for next year are set in advance, and the release itself notes that policy changes, including tax credit rules, could alter the market. Shoppers can compare plans during open enrollment on healthcare.gov or their state exchange, and should review networks, deductibles and out-of-pocket limits, not only monthly premiums.

What to watch next

Watch the next release for the size of any further risk adjustment changes, whether the medical loss ratio holds near the new guidance range, and what Oscar says about 2027 pricing and membership. Oscar's filings are on the SEC website. This article summarises public company statements and is not financial or medical advice.