Health insurance startup Oscar Health unveiled a new product for small businesses called Oscar for Business.
The service is launching as the company struggles with its original plan focused on individual insurance through the Affordable Care Act (ACA). Oscar was the only startup with the approval to sell exchanges under Obamacare when it launched in 2013, right before the ACA began to take full effect.
But the individual marketplace isn't as lucrative as hoped in some areas of the country. So they are now launching a new service, which is not a new answer to the earlier model, according to CEO Mario Schlosser.
"Most Americans get health insurance through their employers," he told TechCrunch. "Very early on we thought maybe we should build software for existing employers, existing insurance companies."
In addition to providing health insurance to around 20 million Americans who otherwise would not have one, ACA also mandates companies with 50 or more employees to provide workers with health insurance. Oscar for Business taps into this requirement, which covers roughly 56 percent of the U.S. population. Also, with this sort of service, Oscar could eventually find its way to larger corporate customers.
The new service kicks off in New York state, where it has already soft launched and worked with a handful of businesses for the last couple of months. The product is focused on small businesses with up to 100 employees, and will offer the same services as the individual plans. Oscar will eventually offer the same service in other states as it works through regulatory hurdles.