A lawsuit was filed on behalf of investors in Oscar Health, Inc. (NYSE:OSCR) shares over alleged securities laws violations.
San Diego, CA -- (SBWIRE) -- 05/24/2022 -- An investor in NYSE: OSCR shares filed a lawsuit against Oscar Health, Inc over alleged violations of Federal Securities Laws. in connection with the Company's March 2021 initial public offering ("IPO" or the "Offering").
Investors who purchased shares of Oscar Health, Inc. (NYSE: OSCR) have certain options and for certain investors are short and strict deadlines running. Deadline: July 11, 2022. NYSE: OSCR investors should contact the Shareholders Foundation at firstname.lastname@example.org or call +1(858) 779 - 1554.
On or about March 3, 2021, Oscar Health, Inc sold about 37 million shares of stock in its initial public stock offering (the "IPO") at $39.00 a share, raising nearly $1.4 billion in new capital. On May 13, 2021, Oscar Health, Inc reported earnings for the first time since the IPO. The Company reported an $87.4 million loss or $(0.98) per share in its first quarter of 2021. Analysts polled by FactSet had expected Oscar to report a loss of 53 cents a share.
On August 12, 2021, Oscar Health, Inc disclosed that the Company's 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.
Then, on November 10, 2021, Oscar Health, Inc 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.
During a conference call held the same day, Scott Blackley, the Company's Chief Financial Officer, stated: "We recognized approximately $20 million of risk adjustment expense this quarter related to our risk adjustment data validation audit or RADV results. The RADV exercise is atypical this year due to COVID. It spans two years, 2019 and 2020. The majority of the RADV headwinds relate to the 2019 audit results, which were recently completed."
Shares of Oscar Health, Inc. (NYSE: OSCR) declined to as low as $5.72 per share on January 27, 2022.
The plaintiff alleges on behalf of purchasers of Oscar Health, Inc. (NYSE: OSCR) common shares, that the defendants violated Federal Securities Laws. More specifically, the plaintiff claims that the Registration Statement was materially false and misleading and omitted to state that Oscar was experiencing growing COVID-19 testing and treatment costs, that Oscar was experiencing growing net COVID costs, that Oscar would be negatively impacted by an unfavorable prior year Risk Adjustment Data Validation (RADV) result relating to 2019 and 2020, that Oscar was on track to be negatively impacted by significant SEP membership growth, and that, as a result of the foregoing, Defendants' positive statements about the Company's business, operations, and prospects were materially misleading and/or lacked a reasonable basis.
Those who purchased shares of Oscar Health, Inc. (NYSE: OSCR) have certain options and should contact the Shareholders Foundation.
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About The Shareholders Foundation
The Shareholders Foundation, Inc. is a professional portfolio monitoring and settlement claim filing service, , which does research related to shareholder issues and informs investors of securities class actions, settlements, judgments, and other legal related news to the stock/financial market. Shareholders Foundation, Inc. is in contact with a large number of shareholders and offers help, support, and assistance for every shareholder. The Shareholders Foundation, Inc. is not a law firm. Referenced cases, investigation, and/or settlements are not filed/reached and/or related to Shareholders Foundation. The information is provided as a public service. It is not intended as legal advice and should not be relied upon.