Oscar Health (OSCR) — Positioned for a Tough 2026, and That’s Exactly Why We’re Interested
Oscar Health trades around $18, yet the story developing beneath the surface suggests the company could be setting itself up for a stronger 2026 than many expect. What stood out to us is not simply that the company plans to operate in a more challenging environment next year, but that it has built its entire 2026 product lineup around those tougher conditions on purpose. That level of preparation is rare in this space.
One of the biggest overhangs for insurers right now is the scheduled expiration of enhanced advance premium tax credits (E-APTCs) at the end of 2025. Oscar isn’t pretending this won’t hurt the individual ACA market. In fact, the company expects enrollment to fall by 20% to 30% next year, which translates to roughly 6.1 million people leaving the market. Instead of scrambling to adjust later, Oscar has already priced and designed its 2026 products to work within that scenario.
The company’s condition-specific programs are an example of this. Offerings like HelloMenu (targeted toward women in menopause) don’t just differentiate the product — they help tighten underwriting risk and improve outcomes, both of which matter a lot when margins are under pressure. The 2026 portfolio was also built to encourage retention: many members will be able to “buy down” to a similar plan at a different metal level while keeping their same care team. That reduces churn and softens the premium increase shock.
We also like Oscar’s move to reshape broker incentives. For the first time, the company introduced a bonus program that rewards high-volume sales specifically in November, historically the slowest month of open enrollment. This should pull forward better-quality enrollments and give brokers more time to guide member decisions instead of rushing them in late December.
Piper Sandler is clearly warming up to this setup. The firm upgraded the stock to overweight and raised its price target to $25, which implies roughly 49% upside. While analyst ratings aren’t our reason to buy, it’s notable that this confidence is anchored in fundamental improvements the company is already executing, not speculative hopes.
Oscar shares are up 24% this year, but based on the way the company is planning ahead — rather than reacting later — we think this remains an underappreciated turnaround story with room to run.
If Oscar can convert its careful 2026 planning into real margin expansion, the payoff could be bigger than the market currently expects.
