Oscar Health, Inc. (OSCR) stock surged 15.13% in pre-market trading on Friday, following the release of its exceptional Q1 2025 financial results and growing optimism about potential Medicare expansion. The tech-native insurer reported a net income of $275 million on $3 billion in revenue, marking a 42% year-over-year growth and solidifying its transformation from a money-losing start-up to a profitable growth story.

The company's strong performance can be attributed to operational improvements implemented by new CEO Mark Bertolini, including a record-low SG&A ratio of 15.8% and an impressive medical loss ratio of 75.4%. Moreover, Oscar Health's operating margin expanded to 9.8%, reflecting improved cost control and expanding operating leverage.

Adding to the positive sentiment is the proposed Choose Medicare Act, introduced by Democrats in June 2025. This legislation, if passed, could create a Medicare Part E public option available through ACA marketplaces, potentially tripling Oscar Health's addressable market. With its digital-first approach and established presence in ACA exchanges, the company is well-positioned to capitalize on this potential market expansion, further fueling investor enthusiasm.