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Press release content from Globe Newswire. The AP news staff was not involved in its creation.
PRESS RELEASE: Paid content from Globe Newswire
Press release content from Globe Newswire. The AP news staff was not involved in its creation.

Gainey McKenna & Egleston Announces A Class Action Lawsuit Has Been Filed Against Oscar Health, Inc. (OSCR)

May 19, 2022 GMT

NEW YORK, May 19, 2022 (GLOBE NEWSWIRE) -- Gainey McKenna & Egleston announces that a class action lawsuit has been filed against Oscar Health, Inc. (“Oscar Health” or the “Company”) (NYSE: OSCR) in the United States District Court for the Southern District of New York on behalf of investors who purchased Oscar Health pursuant to and/or traceable to the registration statement and prospectus (collectively, the “Registration Statement”) issued in connection with the Company’s March 2021 initial public offering (“IPO” or the “Offering”).

The Complaint alleges that Defendants’ statements in the Registration Statement were materially false and misleading when made because: (i) the Company was experiencing growing COVID-19 testing and treatment costs; (ii) the Company was experiencing growing net COVID costs; (iii) the Company would be negatively impacted by an unfavorable prior year Risk Adjustment Data Validation (RADV) result relating to 2019 and 2020; and (iv) the Company was on track to be negatively impacted by significant SEP membership growth.

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On August 12, 2021, the Company disclosed that its Medical Loss Ratio (“MLR”) for the second quarter of 2021 was 82.4%, an increase of 2170 basis points year-over year. The Company claimed that “[t]he MLR increased to 82.4% in 2Q21 from 60.7% in 2Q20, primarily driven by meaningfully lower utilization in 2Q20 as a result of COVID-19, as well as higher COVID-19 testing and treatment costs and a return to more normalized utilization in 2Q21.” The Company also disclosed that its net loss for the quarter was $73.1 million, an increase of $32.1 million year-over-year.

On November 10, 2021, the Company also disclosed that its third quarter 2021 MLR increased 920 basis points year-over-year, to 99.7%. The Company claimed that the MLR increase was “primarily driven by higher net COVID costs as compared to the net benefit in 3Q20, an unfavorable prior year Risk Adjustment Data Validation (RADV) result, and the impact of significant SEP membership growth.” The Company also disclosed that its net loss for the quarter was $212.7 million, an increase of $133.6 million year-over-year.

Since the IPO, the price of the Company’s stock has fallen over 85%, closing as low as $5.72 per share on May 12, 2022.

Investors who purchased or otherwise acquired shares of Oscar Health should contact the Firm prior to the July 11, 2022 lead plaintiff motion deadline. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. If you wish to discuss your rights or interests regarding this class action, please contact Thomas J. McKenna, Esq. or Gregory M. Egleston, Esq. of Gainey McKenna & Egleston at (212) 983-1300, or via e-mail at tjmckenna@gme-law.com or gegleston@gme-law.com.

Please visit our website at http://www.gme-law.com for more information about the firm.