A-
Overall grade
B+
Financial quality
The sleeper story is risk adjustment accounting: OSCR is artificially suppressing Q1 revenue by $400M+ through conservative 24% risk adjustment accruals versus 20% full-year guidance, creating a mechanical revenue tailwind through the year. The obvious headline is the profitability inflection, but the real story is they've engineered the perfect membership mix by shedding 400k non-paying members while attracting younger, healthier paid subscribers. The binding constraint is bronze member deductible behavior - with 39% of members now in high-deductible plans versus 25% historically, they're managing utilization seasonality they've never faced at this scale. Management's most revealing quote: 'We have yet to take into account any of the potential favorability that we're seeing in some of these reports' - they're sandbagging on multiple fronts. My view changes if bronze utilization patterns break their seasonal assumptions or if risk adjustment doesn't normalize to 20% by year-end.
The 30-second version
- Risk adjustment is the new revenue recognition game: they're booking 24% accruals while guiding to 20% full-year
- The 400k member churn machine is printing cash: losing the non-payers while keeping revenue per member
- Bronze membership jumped to 39% from 25%, but they're not talking about the deductible utilization cliff
What changed this quarter
| Metric | Prior | This quarter |
|---|---|---|
| Revenue | $11.7B full year 2025 (+28% YoY) | $4.6B Q1 2026 (+53% YoY) |
| MLR | 87.4% full year 2025 (+570 bps YoY) | 70.5% Q1 2026 (-490 bps YoY) |
| SG&A Ratio | 17.5% full year 2025 (-160 bps YoY) | 15.2% Q1 2026 (-60 bps YoY) |
| Operating Income | ($396M) loss 2025 | $704M Q1 2026 |
| Net Income | ($443M) loss 2025 | $679M Q1 2026 |
| Members | 2M at Dec 2025 (+22% YoY) | 3.2M at Mar 2026 (+56% YoY) |
| Paid Members | Expected 3M start Q2 | 3M actual start Q2 |
| Risk Adjustment % of Premium | 18.5% full year 2025 | 24% Q1 2026 |
Accountability tracked
7 new promises made4 narrative shifts flagged6 prior promises graded
Inside the full report
The complete write-up covers the full promise ledger with kept/missed calls, disclosure-quality scoring, the metrics-vanished check, verification items, and the questions to ask next quarter.
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