Oscar Health (OSCR) DEF 14ADefinitive proxy

The Notice of Meeting and Proxy Statement on the following pages describe the matters to be presented at the Annual Meeting. Please see the section called “Who can attend the Annual Meeting?” on page 4 of the proxy statement for more information about how to attend the meeting online.

Whether or not you attend the Annual Meeting online, it is important that your shares be represented and voted at the Annual Meeting. Therefore, I urge you to promptly vote and submit your proxy by phone, via the Internet, or, if you received paper copies of these materials, by signing, dating and returning the enclosed proxy card in the enclosed envelope, which requires no postage if mailed in the United States. If you have previously received our Notice of Internet Availability of Proxy Materials, then instructions regarding how you can vote are contained in that notice. If you have received a proxy card, then instructions regarding how you can vote are contained on the proxy card. If you decide to attend the Annual Meeting, you will be able to vote online, even if you have previously submitted your proxy.

At the Annual Meeting, ten directors are to be elected to hold office until the Annual Meeting of Stockholders to be held in 2025 and until each such director’s respective successor is elected and qualified or until each such director’s earlier death, resignation, or removal.

We currently have ten directors on our Board of Directors. Our current directors, who are also our director nominees for election at the Annual Meeting, are Mark T. Bertolini, Jeffery H. Boyd, William Gassen III, Joshua Kushner, Laura Lang, David Plouffe, Elbert O. Robinson, Jr., Siddhartha Sankaran, Mario Schlosser, and Vanessa A. Wittman. The Board has nominated each of the foregoing director candidates to serve as directors until the 2025 Annual Meeting.

In accordance with our Amended and Restated Certificate of Incorporation and Amended and Restated Bylaws, all director nominees will stand for election for one-year terms that expire at the following year’s annual meeting. Our Amended and Restated Certificate of Incorporation and Amended and Restated Bylaws provide that the authorized number of directors may be changed only by resolution of the Board of Directors, subject to the rights of holders of any series of preferred stock. Subject to the rights of the holders of any series of preferred stock then outstanding in respect of preferred stock directors, any director may be removed with or without cause only by an affirmative vote of at least two-thirds of the voting power of all the outstanding shares of stock entitled to vote generally in the election of directors.

If you submit a proxy but do not indicate any voting instructions, the persons named as proxies will vote the shares of common stock represented thereby for the election as directors of the persons whose names and biographies appear below. In the event that any of Mr. Bertolini, Mr. Boyd, Mr. Gassen, Mr. Kushner, Ms. Lang, Mr. Plouffe, Mr. Robinson, Mr. Sankaran, Mr. Schlosser, or Ms. Wittman should become unable to serve, or for good cause will not serve, as a director, it is intended that votes will be cast for a substitute nominee designated by the Board of Directors or the Board may elect to reduce its size. The Board of Directors has no reason to believe that any of the director nominees will be unable to serve if elected. Each of the director nominees has consented to being named in this proxy statement and to serve if elected.

The proposal regarding the election of directors requires the approval of a plurality of the votes cast. This means that the ten nominees receiving the highest number of affirmative “FOR” votes will be elected as directors. Votes withheld and broker non-votes are not considered to be votes cast and, accordingly, will have no effect on the outcome of the vote on this proposal.

Our Audit Committee has appointed PricewaterhouseCoopers LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2024. Our Board of Directors has directed that this appointment be submitted to our stockholders for ratification at the Annual Meeting. Although ratification of our appointment of PricewaterhouseCoopers LLP is not required, we value the opinions of our stockholders and believe that stockholder ratification of our appointment is a good corporate governance practice.

PricewaterhouseCoopers LLP also served as our independent registered public accounting firm for the fiscal year ended December 31, 2023. Neither the accounting firm nor any of its members has any direct or indirect financial interest in or any connection with us in any capacity other than as our auditors, providing audit and non-audit services. A representative of PricewaterhouseCoopers LLP is expected to attend the 2024 Annual Meeting and to have an opportunity to make a statement and be available to respond to appropriate questions from stockholders.

In the event that the appointment of PricewaterhouseCoopers LLP is not ratified by the stockholders, the Audit Committee will consider this fact when it appoints the independent auditors for the fiscal year ending December 31, 2025. Even if the appointment of PricewaterhouseCoopers LLP is ratified, the Audit Committee retains the discretion to appoint a different independent auditor at any time if it determines that such a change is in the interest of the Company.

This proposal requires the affirmative vote of the holders of a majority of the votes cast. Abstentions and broker non-votes are not considered to be votes cast and, accordingly, will have no effect on the outcome of the vote on this proposal. Because brokers have discretionary authority to vote on the ratification of the appointment of PricewaterhouseCoopers LLP, we do not expect any broker non-votes in connection with this proposal.

As required by Section 14A(a)(1) of the Exchange Act, the below resolution enables our stockholders to vote to approve, on an advisory (non-binding) basis, the compensation of our named executive officers (also referred to as “NEOs”) as disclosed in this proxy statement. This proposal, commonly known as a “say-on-pay” proposal (the “Say-On-Pay Vote”), gives our stockholders the opportunity to express their views on our NEOs’ compensation. The Say-on-Pay Vote is not intended to address any specific item of compensation, but rather the overall compensation of our NEOs and the philosophy, policies and practices described in this proxy statement.

We encourage our stockholders to review the “Compensation Discussion and Analysis” section of this proxy statement for more information.

As an advisory approval, this proposal is not binding upon us or our Board. However, the Talent and Compensation Committee, which is responsible for the design and administration of our executive compensation program, values the opinions of our stockholders expressed through your vote on this proposal. The Board and Talent and Compensation Committee will consider the outcome of this vote in making future compensation decisions for our NEOs. Accordingly, we ask our stockholders to vote FOR the following resolution at the annual meeting:

This proposal requires the affirmative vote of the holders of a majority of the votes cast. Abstentions and broker non-votes are not considered to be votes cast and, accordingly, will have no effect on the outcome of the vote on this proposal. The Say-on-Pay Vote is not binding on us, the Board or the Talent and Compensation Committee.

The Company’s independent registered public accounting firm also provided the Audit Committee with a formal written statement required by PCAOB Rule 3526 (Communications with Audit Committees Concerning Independence) describing all relationships between the independent registered public accounting firm and the Company, including the disclosures required by the applicable requirements of the PCAOB regarding the independent registered public accounting firm’s communications with the Audit Committee concerning independence. In addition, the Audit Committee discussed with the independent registered public accounting firm its independence from the Company.

Based on its discussions with management and the independent registered public accounting firm, and its review of the representations and information provided by management and the independent registered public accounting firm, the Audit Committee recommended to the Board of Directors that the audited consolidated financial statements be included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023.

The Audit Committee has adopted a policy (the “Pre-Approval Policy”) that sets forth the procedures and conditions pursuant to which audit and non-audit services proposed to be performed by the independent auditor may be pre-approved. The Pre-Approval Policy generally provides that we will not engage PricewaterhouseCoopers LLP to render any audit, audit-related, tax or permissible non-audit service unless the service is either (i) explicitly approved by the Audit Committee (“specific pre-approval”) or (ii) entered into pursuant to the pre-approval policies and procedures described in the Pre-Approval Policy (“general pre-approval”). Unless a type of service to be provided by PricewaterhouseCoopers LLP has received general pre-approval under the Pre-Approval Policy, it requires specific pre-approval by the Audit Committee or by a designated member of the Audit Committee to whom the committee has delegated the authority to grant pre-approvals. Any proposed services exceeding pre-approved cost levels or budgeted amounts will also require specific pre-approval. For both types of pre-approval, the Audit Committee will consider whether such services are consistent with the SEC’s rules on auditor independence. The Audit Committee will also consider whether the independent auditor is best positioned to provide the most effective and efficient service, for reasons such as its familiarity with the Company’s business, people, culture, accounting systems, risk profile and other factors, and whether the service might enhance the Company’s ability to manage or control risk or improve audit quality. All such factors will be considered as a whole, and no one factor should necessarily be determinative. The Audit Committee may, on a periodic basis, review and generally pre-approve the services (and related fee levels or budgeted amounts) that may be provided by PricewaterhouseCoopers LLP without first obtaining specific pre-approval from the Audit Committee. The Audit Committee may revise the list of general pre-approved services from time to time, based on subsequent determinations. The Audit Committee pre-approved all services performed since the Pre-Approval Policy was adopted.

We believe our strong corporate governance practices help us achieve our performance goals and maintain the trust and confidence of our stockholders, employees, members, commercial partners, regulators, and other stakeholders. The following table highlights certain of our corporate governance practices and policies:

Our Board of Directors has adopted Corporate Governance Guidelines, a Code of Conduct, and charters for our Nominating and Corporate Governance Committee, Audit Committee and Talent and Compensation Committee to assist the Board in the exercise of its responsibilities and to serve as a framework for the effective governance of the Company. You can access our current committee charters, our Corporate Governance Guidelines, and our Code of Conduct in the “Governance” section of the “Investor Relations” page of our website located at ir.hioscar.com, or by writing to our Secretary at our offices at 75 Varick Street, 5th Floor, New York, New York 10013.

Our Board of Directors currently consists of ten members: Mark T. Bertolini, Jeffery H. Boyd, William Gassen III, Joshua Kushner, Laura Lang, David Plouffe, Elbert O. Robinson, Jr., Siddhartha Sankaran, Mario Schlosser, and Vanessa A. Wittman. Our Amended and Restated Certificate of Incorporation and Amended and Restated Bylaws provide that the authorized number of directors may be changed only by resolution of the Board of Directors, subject to the rights of holders of any series of preferred stock. Subject to the rights of the holders of any series of preferred stock then outstanding in respect of preferred stock directors, any director may be removed with or without cause only by an affirmative vote of at least two-thirds of the voting power of all the outstanding shares of stock entitled to vote generally in the election of directors.

Our Board of Directors has determined that Jeffery H. Boyd, William Gassen III, Laura Lang, David Plouffe, Elbert O. Robinson, Jr., and Vanessa A. Wittman each qualify as “independent” in accordance with the listing requirements of the New York Stock Exchange (“NYSE”). In making these determinations, our Board of Directors reviewed and discussed information provided by the directors and us with regard to each director’s business and personal activities and relationships as they may relate to us and our management. Specifically, the Board considered that Mr. Gassen is the Chief Executive Officer of Sanford Health, which periodically receives

Our non-management directors meet in executive session without management directors or other members of management present on a regularly scheduled basis. We also hold an executive session including only independent directors at least once per year. Each executive session of the non-management directors or the independent directors is presided over by the Chair of the Board.

There were five meetings of the Board of Directors during the fiscal year ended December 31, 2023. During the fiscal year ended December 31, 2023, each director attended at least 75% of the aggregate of (i) all meetings of the Board of Directors and (ii) all meetings of the committees on which the director served during the period in which he or she served as a director.

Under our Corporate Governance Guidelines, which are available on our website at ir.hioscar.com, a director is expected to spend the time and effort necessary to properly discharge his or her responsibilities. Accordingly, a director is expected to regularly prepare for and attend meetings of the Board and all committees on which the director serves (including separate meetings of the non-management directors or independent directors), with the understanding that, on occasion, a director may be unable to attend a meeting. A director who is unable to attend a meeting of the Board or a committee of the Board is expected to notify the Chair of the Board or the Chair of the appropriate committee in advance of such meeting, and, whenever possible, participate in such meeting via teleconference in the case of an in-person meeting. We do not maintain a formal policy regarding director attendance at our Annual Meeting of Stockholders; however, it is expected that absent compelling circumstances, directors will attend. All of the then-serving directors attended our Annual Meeting of Stockholders held in 2023.

We are a “controlled company” under the rules of the NYSE. The rules of the NYSE define a “controlled company” as a company of which more than 50% of the voting power for the election of directors is held by an individual, a group, or another company. Entities affiliated with Thrive Capital and Joshua Kushner (as the sole managing member of the Thrive General Partners (as defined below)) beneficially own approximately 72.7% of the combined voting power of our outstanding capital stock. As a result, we qualify for exemptions from, and have elected not to comply with, certain corporate governance requirements under the NYSE rules. Even though we are a controlled company, we are required to comply with the rules of the SEC and the NYSE relating to the membership, qualifications, and operations of the audit committee, as discussed below.

If we cease to be a controlled company and our Class A common stock continues to be listed on the NYSE, we will be required to comply with these requirements by the date our status as a controlled company changes or within specified transition periods applicable to certain provisions, as the case may be.

The Nominating and Corporate Governance Committee is primarily responsible for searching for qualified director candidates for election to the Board and filling vacancies on the Board. To facilitate the search process, the Nominating and Corporate Governance Committee may solicit current directors and executives of the Company for the names of potentially qualified candidates or ask directors and executives to pursue their own business contacts for the names of potentially qualified candidates. The Nominating and Corporate Governance Committee may also consult with outside advisors or retain search firms to assist in the search for qualified candidates, or consider director candidates recommended by our stockholders. Once potential candidates are identified, the Nominating and Corporate Governance Committee reviews the backgrounds of those candidates, evaluates candidates’

In evaluating the suitability of individual candidates (both new candidates and current Board members), the Nominating and Corporate Governance Committee, in recommending candidates for election, and the Board, in approving (and, in the case of vacancies, appointing) such candidates, may take into account many factors, including: personal and professional integrity, ethics and values; leadership skills and experience in corporate management, such as serving as an officer or former officer of a publicly held company; strong finance experience; relevant social policy concerns; experience relevant to the Company’s industry; experience as a board member of another publicly held company; relevant academic expertise or other proficiency in an area of the Company’s operations; diversity of expertise and experience in substantive matters pertaining to the Company’s business relative to other board members; diversity of background and perspective; practical and mature business judgment, including, but not limited to, the ability to make independent analytical inquiries; and any other relevant qualifications, attributes or skills. In addition, the Board will consider whether there are potential conflicts of interest with the candidate’s other personal and professional pursuits. The Board evaluates each individual in the context of the Board as a whole and monitors the mix of specific experience, qualifications and skills of its directors, with the objective of assembling a group that has the necessary tools to perform its oversight function effectively in light of the Company’s business and structure and represent stockholder interests through the exercise of sound judgment, using its diversity of experience in these various areas. In determining whether to recommend a director for re-election, the Nominating and Corporate Governance Committee may also consider the director’s past attendance at meetings and participation in and contributions to the activities of the Board.

As noted above, diversity of background and perspective is among the factors that the Nominating and Corporate Governance Committee considers when evaluating the composition of the Board. As set forth in our Corporate Governance Guidelines, this includes, but is not limited to, age, sex, race, place of residence, and specialized experience. When recommending director nominees for election by stockholders, the Board and the Nominating and Corporate Governance Committee evaluate how the experience and skill set of each director nominee complements those of the other director nominees and sitting Board members to create a balanced Board with diverse viewpoints and extensive expertise. In addition, the Board evaluates the appropriateness of its composition, including with respect to diversity, through periodic self-assessments. Each director candidate contributes to the Board’s overall diversity by providing a variety of perspectives from his or her personal and professional experiences and backgrounds. The director candidates range in age from 38 to 68; two of the ten director candidates are women; and two are ethnically diverse.

Stockholders may recommend individuals to the Nominating and Corporate Governance Committee for consideration as potential director candidates by submitting the names of the recommended individuals, together with appropriate biographical information and background materials, to the Nominating and Corporate Governance Committee, c/o Secretary, Oscar Health, Inc., 75 Varick Street, 5^th Floor, New York, New York 10013. In the event there is a vacancy, and assuming that appropriate biographical and background material has been provided on a timely basis, the Nominating and Corporate Governance Committee will evaluate stockholder-recommended candidates by following substantially the same process, and applying substantially the same criteria, as it follows for candidates submitted by others.

The Board will give appropriate attention to written communications that are submitted by stockholders or other interested parties, and will respond if and as appropriate. Our Secretary is primarily responsible for monitoring communications from stockholders and other interested parties, and for providing copies or summaries to the directors as she considers appropriate.

Communications are forwarded to all directors if they relate to important substantive matters and include suggestions or comments that our Secretary and Chair of the Board consider to be important for the directors to know. In general, communications relating to corporate governance and long-term corporate strategy are more likely to be forwarded than communications relating to ordinary business affairs, personal grievances and matters as to which we tend to receive repetitive or duplicative communications.

Our Amended and Restated Bylaws and Corporate Governance Guidelines provide our Board of Directors with flexibility to combine or separate the positions of Chair of the Board and Chief Executive Officer in accordance with its determination that utilizing one or the other structure would be in the best interests of our Company. We currently have an independent Chair of the Board and a majority of our Board is comprised of independent directors. Our Board believes that separation of the positions of Chair and Chief Executive Officer reinforces the independence of the Board from management, creates an environment that encourages objective oversight of management’s performance and enhances the effectiveness of the Board as a whole, while allowing our Chief Executive Officer to focus on the strategic direction, succession and performance of the Company. In addition, our Board believes that Mr. Boyd is best situated to serve as Chair at this time due to his deep knowledge of our Company, his proven leadership, and corporate governance skills. For these reasons, our Board of Directors has concluded that our current leadership structure is appropriate at this time.

However, our Board of Directors will continue to periodically review our leadership structure and may make such changes in the future as it deems appropriate. The authority and responsibilities of the Chair of the Board are detailed in our Corporate Governance Guidelines and in our Amended and Restated Bylaws. If, in the future, the Chair of the Board is a member of management or does not otherwise qualify as independent, our Corporate Governance Guidelines provide for the appointment by the independent directors of a Lead Director. The Lead Director’s responsibilities would include, but would not be limited to, presiding over all meetings of the Board of Directors at which the Chair of the Board is not present, including any executive sessions of the non-management directors or independent directors, approving the Board’s meeting schedules and agendas, and acting as liaison between the independent directors of the Board and the Chief Executive Officer and the Chair of the Board.

Risk assessment and oversight are an integral part of our governance and management processes. Our Board of Directors encourages management to promote a culture that incorporates risk management into our corporate strategy and day-to-day business operations. Management discusses strategic and operational risks at regular management meetings and conducts specific strategic planning and review sessions during the year that include a focused discussion and analysis of the risks facing us. Throughout the year, senior management reviews these risks with the Board of Directors at regular Board meetings as part of management presentations that focus on particular business functions, operations or strategies, and presents the steps taken by management to mitigate or eliminate such risks. Senior management has also established a strategic planning cycle with the Board of Directors which includes reviewing the assumptions underlying the strategic plan, strategic planning sessions, and deep dive sessions with respect to the pillars of the Company's strategic plan.

Our Board of Directors is responsible for overseeing our risk management process. Our Board of Directors focuses on our general risk management strategy and the most significant risks facing us, and oversees the implementation of risk mitigation strategies by management. Our Audit Committee is responsible for discussing our policies with respect to risk assessment and risk management, including guidelines and policies to govern the process by which risk assessment and management is undertaken, for reviewing and evaluating our risk appetite statements, and for overseeing management of our financial and cybersecurity risks, including reviewing and discussing with management our major financial and cybersecurity risk exposures and the steps management has taken to monitor and control such exposures. Our Nominating and Corporate Governance Committee is responsible for overseeing the management of risks associated with the independence of our Board of Directors. Our Talent and Compensation Committee is responsible for overseeing the management of risks relating to the Company’s executive compensation plans and arrangements.

Succession planning and talent development are important at all levels within our organization. The Board, together with the Talent and Compensation Committee, oversees the succession planning for the CEO and other executive officers. The Talent and Compensation Committee biannually reviews succession plans for senior management and the CEO, including both a long-term succession plan and an emergency succession plan, and provides updates to the full Board regarding its review. The CEO also provides the full Board with a succession update quarterly. The Talent and Compensation Committee’s succession planning activities are ongoing and strategic, and may be supported by independent third-party consultants. In addition, the CEO annually provides his assessment to the Talent and Compensation Committee of senior leaders and their potential to succeed at key senior management positions. Potential leaders interact with board members through formal presentations and during informal events. The Talent and Compensation Committee also regularly evaluates succession plans in the context of the Company’s overall business strategy and with a focus on risk management.

We have a written Code of Conduct that applies to our directors, officers, and employees, including our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. We have posted a current copy of the Code of Conduct on our website, ir.hioscar.com, in the “Governance Documents” section under “Governance”. In addition, we intend to post on our website all disclosures that are required by law or the rules of the NYSE concerning any amendments to, or waivers from, any provision of the Code of Conduct.

Our Board of Directors has adopted an Insider Trading Policy, which applies to all of our directors, officers, employees and contractors, as well as their family members and entities within their control (“Covered Persons”). The policy prohibits Covered Persons from purchasing financial instruments such as prepaid variable forward contracts, equity swaps, collars and exchange funds, or otherwise engaging in transactions that hedge or offset, or are designed to hedge or offset, any decrease in the market value of the Company’s equity securities, or that may cause a Covered Person to no longer have the same objectives as the Company’s other stockholders.

Our mission is to make a healthier life accessible and affordable for all. We view it as a privilege and responsibility to serve our approximately 1.3 million members, as of January 1, 2024, who have entrusted us with guiding their care. This work is supported by our technology and our people. We use our technology to drive individualized care for our members, including many individuals who have been historically underserved or overlooked. We are powered by our employees: a group of people with unique backgrounds, experiences, and talents they bring to work every day – all working to change healthcare for the better.

We discuss these and other environmental, social, and governance topics in our 2023 Impact Report, which can be found within the “Investor Relations” section of our website. Neither the 2023 Impact Report nor the contents of our website are incorporated by reference herein.

The Audit Committee charter is available on our website at ir.hioscar.com. The members of the Audit Committee are Ms. Wittman, Ms. Lang, and Mr. Plouffe, with Mr. Boyd serving as an ex-officio, non-voting member. Ms. Wittman serves as the Chair of the committee. Our Board has affirmatively determined that each of Ms. Wittman, Ms. Lang, and Mr. Plouffe is independent for purposes of serving on an audit committee under Rule 10A-3 promulgated under the Exchange Act and the NYSE Rules, including those related to audit committee membership.

The Audit Committee may delegate its authority under its charter to one or more subcommittees as it deems appropriate from time to time, and may engage such legal, accounting and other advisors as it deems necessary or appropriate to carry out its responsibilities.

The members of our Audit Committee meet the requirements for financial literacy under the applicable NYSE rules. In addition, our Board of Directors has determined that Ms. Wittman qualifies as an “audit committee financial expert,” as such term is defined in Item 407(d)(5) of Regulation S-K. No Audit Committee member currently serves on the audit committee of more than three public companies.

Our Talent and Compensation Committee, formerly known as our Compensation Committee, is responsible for assisting the Board in the discharge of its responsibilities relating to the compensation of our executive officers. In fulfilling its purpose, our Talent and Compensation Committee has the following principal duties:

The Talent and Compensation Committee generally considers the Chief Executive Officer’s recommendations when making decisions regarding the compensation of executive officers (other than the Chief Executive Officer). Pursuant to the Talent and Compensation Committee’s charter, which is available on our website at ir.hioscar.com, the Talent and Compensation Committee has

The Talent and Compensation Committee may delegate its authority under its charter to one or more subcommittees as it deems appropriate from time to time. The Talent and Compensation Committee may also delegate to an officer the authority to grant equity awards to certain employees, as further described in its charter and subject to the terms of our equity plans. The Talent and Compensation Committee has delegated to the then-serving Chief Executive Officer and the Chief Financial Officer, jointly in their capacity as officers of the Company, the authority to approve changes or amendments to the vesting or exercise schedules of awards granted under our incentive equity plan, other than for certain officers and directors.

The members of our Talent and Compensation Committee are Ms. Lang, Ms. Wittman and Mr. Robinson, with Mr. Boyd serving as an ex-officio, non-voting member. Ms. Lang serves as the Chairperson of the Talent and Compensation Committee. Each member of the Talent and Compensation Committee qualifies as an independent director under NYSE’s heightened independence standards for members of a compensation committee and as a “non-employee director” as defined in Rule 16b-3 of the Exchange Act.

The Nominating and Corporate Governance Committee charter is available on our website at ir.hioscar.com. The members of our Nominating and Corporate Governance Committee are Mr. Kushner, Mr. Gassen and Mr. Plouffe, with Mr. Boyd serving as an ex-officio, non-voting member. Mr. Kushner serves as the Chair of the Nominating and Corporate Governance Committee. Our Board of Directors has affirmatively determined that Mr. Gassen and Mr. Plouffe each meet the definition of “independent director” under the NYSE rules. We currently avail ourselves of the “controlled company” exception under the NYSE rules, which exempts us from the requirement that we have a nominating and corporate governance committee composed entirely of independent directors and allows Mr. Kushner to serve on the committee. The Nominating and Corporate Governance Committee has the authority to consult with outside advisors or retain search firms to assist in the search for qualified candidates, or consider director candidates recommended by our stockholders.

In this Compensation Discussion and Analysis (“CD&A”), we provide an overview and analysis of the compensation awarded to or earned by our named executive officers (each, an “NEO”) identified in the Summary Compensation Table below during fiscal year 2023, including the elements of our compensation program for NEOs, material compensation decisions made under that program for fiscal year 2023, and the material factors considered in making those decisions. Our NEOs for the year ended December 31, 2023 and their positions are as follows:

Mr. Kushner, our Co-Founder and Vice Chair, did not receive compensation and benefits from us during 2023 and therefore, in accordance with SEC rules, is not included as an NEO.

2023 was a pivotal year for the Company, as management delivered strong 2023 results with most core metrics exceeding expectations for the full year. Management also delivered on its commitment for InsuranceCo Adjusted EBITDA profitability, and ended the year with a clear line of sight into consolidated Adjusted EBITDA profitability in 2024. We achieved the following highlights for year end 2023:

Our executive compensation program is designed to deliver pay in accordance with corporate and individual performance, incentivizing and rewarding superior performance, and providing consequences for underperformance. We believe that the compensation of our NEOs for fiscal year 2023 was aligned with our performance during the year. Consistent with our compensation philosophy, key compensation decisions for 2023 included the following:

We are asking our stockholders to vote, at this 2024 annual meeting of stockholders, in a non-binding, advisory vote to approve the compensation of our NEOs (the “Say-on-Pay Vote”). Our Talent and Compensation Committee will consider the result of the annual Say-on-Pay Vote in determining the ongoing design and administration of our executive compensation program. At our 2022 Annual Meeting of Stockholders, our stockholders voted in a non-binding advisory vote in favor of holding an annual Say-On-Pay Vote. At our 2023 Annual Meeting of Stockholders, 99.91% of the votes cast in the Say-on-Pay Vote were in favor of the Say-on-Pay Vote. We view this level of stockholder support as affirmation of our current executive compensation programs and policies and our pay for performance philosophy. Consistent with the stated preference of a majority of our stockholders, our next Say-on-Pay Vote (following the vote at this 2024 Annual Meeting of Stockholders) will be held at our 2025 Annual Meeting of Stockholders.

The Talent and Compensation Committee engages in an ongoing review of the Company’s executive compensation program to evaluate whether the program supports the Company’s compensation objectives and if it is aligned with the long-term interests of the Company’s stockholders. Our executive compensation program objectives are to attract and retain top healthcare, technology, insurance, and general industry leadership talent, to further our goal of ensuring healthcare meets the needs of every individual. Our compensation philosophy strives to apply an approach to compensation that is systematic, equitable, and rooted in data. The Talent and Compensation Committee has engaged Frederic W. Cook & Co., Inc., which we refer to as FW Cook, an independent compensation consultant, to help ensure that the Talent and Compensation Committee’s decisions and actions consider industry benchmarks, best practices, and market intelligence, as well as other factors. In designing our executive compensation program, our Talent and Compensation Committee seeks to strike a balance between following market best practices for our unique blend of insurance, healthcare, and technology industries, and offering compensation packages that distinguish us in the market.

Our Talent and Compensation Committee strives to set total compensation at a competitive level for each executive. In addition to market data, the Committee considers factors such as an executive’s experience and performance, scope of position, internal parity, and the competitive demand for proven executive talent, as described further below under “Determination of Executive Compensation.”

For annual bonus and equity incentive awards, our Talent and Compensation Committee’s aim is to compensate our executive officers based on their and the Company’s performance in a disciplined, transparent, and predictable manner. Our executive compensation program is aligned with our broader equity compensation program, which is based on four principles:

In setting executive compensation, the Talent and Compensation Committee considers a number of factors in addition to the factors mentioned in the section above, including the recommendations of our Chief Executive Officer (other than with respect to the Chief Executive Officer’s own compensation) and our Chief People Officer, current and past total compensation, competitive market data and analysis provided by the Talent and Compensation Committee’s independent compensation consultant, and Company performance and each executive’s impact on performance. Our Chief Executive Officer’s recommendations are based on his evaluation of the individual performance and contributions of each of the other NEOs, of which our Chief Executive Officer has direct knowledge.

In August 2022, we developed the below peer group with FW Cook, which informed the Talent and Compensation Committee’s review of our executive compensation program for fiscal year 2023. We selected the peer group companies based on a combination of relevant factors, including industry classification, business model, and size (including employee count, revenue, and market capitalization).

In August 2023, the Talent and Compensation Committee conducted its annual review of the peer group and determined to maintain a hybrid peer group of health insurance and technology-enabled companies, revising the group to better align with the Company’s evolving business strategy and financial profile. In particular, the Committee approved the removal of the following companies from the peer group due to acquisition or differences in business model or financial profile: 1Life Healthcare, Bright Health Group, Ceridian, Change Healthcare, eHealth, Oak Street Health, Paylocity, SS&C Technologies and Veradigm (f/k/a Allscripts). The Committee approved the addition of two comparably-sized healthcare technology companies: Agilon Health and Privia Health. The Committee approved the below peer group, which was developed with FW Cook, to inform our executive compensation program for fiscal year 2024.

In addition, our NEOs are eligible to participate in our health and welfare programs and our 401(k) plan on the same basis as our other full-time employees. Each of these elements of compensation for 2023 is described further below.

Due to his temporary role serving as our Interim Chief Financial Officer, Mr. Sankaran received an equity award in 2022 in connection with his appointment to that role and his service in 2023, but was not eligible to receive base salary, cash incentives or additional equity incentives in 2023.

We consider annual cash incentive bonuses to be an important component of our total compensation program in incentivizing achievement of our near-term priorities that are expected to drive sustainable long-term stockholder value. Other than Mr. Sankaran, each NEO is eligible to receive an annual performance-based cash bonus based on a specified target annual bonus award amount, expressed as a percentage of the NEO’s base salary. For fiscal year 2023, the target cash bonus for each eligible NEO was 30% of base salary. In future annual incentive cycles, we plan to differentiate the values of executive annual cash incentive bonus targets.

The 2023 annual bonuses for the eligible NEOs were determined based on the achievement of company performance goals (the “Company Performance Goals”) that were established at the beginning of 2023 and were aligned with the Company’s financial, operational/strategic, human capital and growth/innovation goals and targets applied to all employees. For each category other than the financial category, the threshold, target, and maximum payouts for our NEOs were 30%, 100% and 130%, respectively, of the applicable target bonus opportunity. For the financial category, there was an additional NEO maximum opportunity of 200% of target for outperformance. This was intended to reflect the criticality of these financial goals in driving sustainable stockholder value.

Our actual Adjusted EBITDA for 2023 was ($45 million) and our actual Direct and Assumed Premiums were $6.6 billion. In considering our achievement of the operational/strategic, human capital and growth goals, the Talent and Compensation Committee determined that we achieved slightly below target on the operational/strategic goals and achieved the maximum goals relating to employee retention, member inclusion and preparing for expansion. Based on the Company’s achievement of the applicable Company Performance Goals and the weighting applied to each of the targets, as noted in the chart above, the Talent and Compensation Committee determined that 135% of the executives’ applicable target bonus opportunity was achieved. The participating executives’ 2023 annual bonuses are set forth in the column entitled “Non-Equity Incentive Plan Compensation” (with respect to the Company Performance Component) in the “Summary Compensation Table” below.

In 2023, we granted equity-based compensation to certain of our NEOs in the form of stock options and/or RSUs, as described below. Our equity-based compensation program for 2023 consisted of an annual equity award program for Mr. Blackley, Ms. Quane and Ms. Bopitiya. These equity-based awards comprised 70% to 84% of Mr. Blackley and Mmes. Quane and Bopitiya’s total direct compensation in 2023. Mr. Bertolini did not participate in our annual equity award program but instead received sign-on equity awards granted in connection with his appointment as our Chief Executive Officer. In addition, Mr. Schlosser (along with Mr. Kushner, our Vice Chair) recommended the forfeiture of the Founders Awards granted to them in connection with our initial public offering.

In March 2023, the Talent and Compensation Committee approved grants of stock options and RSUs to each of Mr. Blackley, Ms. Bopitiya and Ms. Quane. Mr. Schlosser did not receive an equity award in 2023. The Talent and Compensation Committee approved the following equity awards:

Each annual equity award granted in 2023 will vest over a four-year period in sixteen equal quarterly installments beginning on June 1, 2023, subject to the executive’s continued service through the applicable vesting date.

In connection with his appointment as our Chief Executive Officer in April 2023, the Talent and Compensation Committee approved the grant of 2,866,666 RSUs and 7,453,334 PSUs to Mr. Bertolini. The Talent and Compensation Committee designed Mr. Bertolini’s compensation opportunity to align his interests with those of our stockholders, with a focus on achieving sustained, significant stock price growth and stockholder value. The awards were also designed to be retentive, with both sets of awards having a three-year vesting period. The Company does not intend to grant Mr. Bertolini any additional long-term incentive or equity-based compensatory awards prior to calendar year 2026.

The RSU award vests with respect to one-third of the RSUs on each of the first three anniversaries of Mr. Bertolini’s employment start date, subject to his continued employment or service as the Company’s Chief Executive Officer or a member of the Board through the applicable vesting date.

The PSU award vests based on both (i) the achievement of pre-determined price per share goals over the period commencing on (and including) the grant date and ending on (and including) the third anniversary of Mr. Bertolini’s employment start date (the “performance period”); and (ii) Mr. Bertolini’s continued employment or service as the Company’s Chief Executive Officer through the end of the performance period.

The PSUs will become “earned PSUs” based on the achievement of applicable price per share goals sustained over a 90 consecutive trading-day period, during the three-year performance period, as set forth in the following table. The Talent and Compensation Committee determined the price per share goals during the first quarter of 2023 when the stock closing prices ranged from $2.46 to $5.70 leading up to the announcement of Mr. Bertolini’s appointment. They determined the price-per-share goals listed below were challenging yet achievable given Mr. Bertolini’s expertise and track record of building and scaling companies. Moreover, the

As noted above, the share price is measured by averaging the closing price per share over any 90 consecutive trading-day period during the performance period; however, upon a change in control, the share price will be determined based on the price per share paid by an acquirer (or, as applicable, the implied value per share) in the transaction (the “CIC price”).

Any vested PSUs will be paid in shares of the Company’s Class A common stock within 30 days following the earlier to occur of the last day of the performance period and Mr. Bertolini’s separation from service following a change in control event of the Company.

In support of reducing the dilutive effects of equity awards granted to Mr. Bertolini in connection with his hiring as Chief Executive Officer, and the Company’s annual employee equity awards granted in 2023, the Company’s founders, Mr. Schlosser and Mr. Kushner, each recommended to the Company’s Board of Directors that the Company cancel and terminate the Founders Award that was granted to him in connection with our initial public offering. Mr. Schlosser and Mr. Kushner each entered into an agreement in March 2023 to cancel and terminate their Founders Awards, which consisted of PSUs covering 4,229,853 shares (for Mr. Schlosser) and 2,114,926 shares (for Mr. Kushner) of the Company’s Class A common stock.

We granted PSUs to Mr. Blackley, Ms. Bopitiya and Ms. Quane in 2021 that were designed to incentivize the grantees to achieve profitability of the Company’s insurance business during the fiscal year 2023, and promote retention through cliff vesting on September 1, 2024 for any earned shares. The PSUs were eligible to vest only if we achieved InsuranceCo profitability for calendar year 2023. When approving the PSUs in 2021, the Company primarily assessed profitability based on our achievement of an InsuranceCo Combined Ratio of 100% or less. Following 2021, we had refined our method of assessing InsuranceCo profitability to also include our achievement of a break-even InsuranceCo Adjusted EBITDA, which is an additional metric we referenced when discussing InsuranceCo profitability with our stockholders, and which we believed presents a more complete financial picture of our InsuranceCo business. As such, the Committee believed that it was also appropriate to review our achievement of InsuranceCo Adjusted EBITDA at a level of $20 million or above for 2023 in determining whether the PSUs’ profitability goal was satisfied. Because our InsuranceCo Combined Ratio was 99.5% and we achieved a positive InsuranceCo Adjusted EBITDA of $168.7 million, the PSUs were earned and will vest on September 1, 2024, subject to the executive’s continued service through that date.

We believe that providing a vehicle for tax-deferred retirement savings through our 401(k) plan, and making fully vested matching contributions, adds to the overall desirability of our executive compensation package and further incentivizes our employees, including our NEOs, in accordance with our compensation policies.

We generally do not provide perquisites to our NEOs, and we do not view perquisites or other personal benefits as a significant component of our executive compensation program. In the future, we may provide perquisites or other personal benefits in limited circumstances, such as where we believe it is appropriate to assist an individual executive officer in the performance of the executive’s duties, to make our executive officers more efficient and effective, and for recruitment, motivation, or retention purposes. All future practices with respect to perquisites or other personal benefits will be approved by the Talent and Compensation Committee.

The following table contains information about the compensation earned by each of our NEOs during the fiscal years ended December 31, 2023, December 31, 2022, and December 31, 2021, as well as their positions for 2023.

The following table provides supplemental information relating to grants of plan-based awards made during fiscal year 2023 to help explain information provided above in our Summary Compensation Table. This table presents information regarding all grants of plan-based awards occurring during fiscal year 2023.

In connection with Mr. Bertolini’s appointment as the Company’s Chief Executive Officer, we entered into an employment agreement with Mr. Bertolini, effective as of April 3, 2023. The term of his employment agreement continues for a three-year period that will automatically renew for successive one-year periods, unless either party provides at least 60 days of advance written notice of the party’s intention not to renew the then-current term. The agreement provides for (i) a $600,000 annual base salary, (ii) a target annual bonus equal to 30% of base salary, (iii) eligibility to participate in customary health, welfare, and fringe benefit plans that the Company provides to its employees, and (iv) up to $30,000 reimbursement of reasonable legal costs in connection with negotiating the agreement and related agreements. Mr. Bertolini was granted certain RSU and PSU awards pursuant to the employment agreement, as described above under the section entitled, “—Equity-Based Long-Term Incentive Awards—Bertolini Awards”. The severance benefits and payments payable to Mr. Bertolini upon certain qualifying terminations of his employment are summarized below under the section entitled, “—Potential Payments Upon Termination or Change in Control”.

In connection with entering into his employment agreement, Mr. Bertolini entered into a proprietary information and inventions agreement, which includes non-solicitation and non-competition covenants during his period of employment and for the 12 months following. Further, the employment agreement includes a “best pay” provision under Section 280G of the Internal Revenue Code, pursuant to which any “parachute payments” that become payable to Mr. Bertolini will either be paid in full or reduced so that such payments are not subject to the excise tax under Section 4999 of the Internal Revenue Code, whichever results in the better after-tax treatment to Mr. Bertolini.

On November 29, 2012, we entered into an offer letter with Mr. Schlosser, pursuant to which he served as our Chief Executive Officer. Mr. Schlosser’s offer letter provided for at-will employment, an annual base salary, and eligibility to participate in the benefit plans and programs maintained for the benefit of our employees. Mr. Schlosser’s offer letter required that he sign a proprietary information and inventions agreement, which includes non-solicitation and non-competition covenants during the period of his employment and for 12 months following the termination of his employment. Mr. Schlosser’s offer letter did not contain any severance and change in control provisions.

In connection with Mr. Schlosser’s transition to the Company’s President of Technology, we entered into an employment agreement that became effective on April 3, 2023 and superseded his 2012 offer letter. The term of this employment agreement will continue until terminated in accordance with its terms. The agreement provides for (i) a $600,000 annual base salary, (ii) a target annual bonus equal to 30% of base salary, (iii) eligibility to participate in customary health, welfare, and fringe benefit plans that the Company provides to its employees, and (iv) up to $30,000 reimbursement of reasonable legal costs in connection with negotiating the agreement and related agreements. The severance benefits and payments payable to Mr. Schlosser upon certain qualifying terminations of his employment are summarized below under the section entitled, “—Potential Payments Upon Termination or Change in Control”. The employment agreement reaffirms Mr. Schlosser’s proprietary information and inventions agreement, which includes non-solicitation and non-competition covenants during his period of employment and for the 12 months following. Further, the employment agreement includes a “best pay” provision under Section 280G of the Internal Revenue Code, pursuant to which any “parachute payments” that become payable to Mr. Schlosser will either be paid in full or reduced so that such payments are not subject to the excise tax under Section 4999 of the Internal Revenue Code, whichever results in the better after-tax treatment to Mr. Schlosser.

The following is a description of the employment agreements that were in effect in 2023 with Mr. Blackley, Ms. Quane, and Ms. Bopitiya.

Under each of the agreements, the applicable executive reports to our Chief Executive Officer. Each agreement will continue until terminated in accordance with its terms, and provides for (A) a $600,000 annual base salary paid in accordance with our normal payroll practices and which may be increased in the discretion of our board of directors, but not reduced, (B) a target annual bonus equal to 30% of base salary, with the actual amount of such bonus determined in the discretion of our board of directors, based on the achievement of individual and/or company performance goals determined by our board of directors and payable on the date annual bonuses are paid to the our other senior executives, but in no event later than March 15^th and conditioned upon the executive’s continued employment through the payment date, and (C) eligibility to participate in customary health, welfare, and fringe benefit plans we provide to our employees.

The severance benefits and payments payable to the executives upon certain qualifying terminations of their employment are summarized below under the section entitled, “—Potential Payments Upon Termination or Change in Control”.

The employment agreements also reaffirm or require agreement to, as applicable, a proprietary information and inventions agreement, which includes non-solicitation and non-competition covenants during the applicable executive’s period of employment and for the 12 months following. Further, the employment agreements include a “best pay” provision under Section 280G of the Internal Revenue Code, pursuant to which any “parachute payments” that become payable to the executive will either be paid in full or reduced so that such payments are not subject to the excise tax under Section 4999 of the Internal Revenue Code, whichever results in the better after-tax treatment to the executive.

Effective December 1, 2022, we entered into an offer letter with Mr. Sankaran, pursuant to which he served as our Interim Chief Financial Officer. Mr. Sankaran’s offer letter provided for at-will employment, an RSU award with an aggregate value of $3,600,000, and eligibility to participate in the benefit plans and programs maintained for the benefit of our employees. As noted above, Mr. Sankaran did not participate in the Company’s standard NEO compensation structure, and so was not eligible to receive an annual base salary or annual bonus during his service as Interim Chief Financial Officer. Mr. Sankaran’s offer letter required that he sign a proprietary information and inventions agreement, which includes non-solicitation and non-competition covenants during the period of his employment and for 12 months following the termination of his employment.

The following table summarizes the number of shares of common stock underlying outstanding equity incentive plan awards for each NEO as of December 31, 2023. Awards granted prior to March 2021 were granted under our Amended and Restated 2012 Plan (the “2012 Plan”); awards granted from or after March 2021 were granted under our 2021 Incentive Award Plan (the “2021 Plan”) or, with respect to Mr. Bertolini’s 2023 awards, our 2022 Employment Inducement Incentive Award Plan (the “Inducement Plan”).

The following table sets forth information regarding the exercise of vested stock options and vesting of stock awards by our NEOs during fiscal year 2023.

The severance payments and benefits described above are subject to the executive’s execution and non-revocation of a general release of claims in favor of the Company and continued compliance with the executive’s confidentiality, non-competition and non-solicitation requirements (as described above), and are in addition to any accrued amounts (including, other than upon a termination without good reason or for cause, any prior year’s earned but unpaid annual bonus).

All outstanding Company equity-based awards held by Mr. Bertolini on the date of termination will be governed by the terms of the applicable award agreements. The severance payments and benefits described above are subject to Mr. Bertolini’s execution and non-revocation of a general release of claims in favor of the Company and continued compliance with his restrictive covenant obligations (e.g., confidentiality, non-competition, non-solicitation and non-disparagement), and are in addition to any accrued amounts (including, other than upon a termination without good reason or for cause, any prior year’s earned but unpaid annual bonus).

All outstanding Company equity-based awards held by Mr. Schlosser on the date of termination will be governed by the terms of the applicable award agreements. The severance payments and benefits described above are subject to Mr. Schlosser’s execution and non-revocation of a general release of claims in favor of the Company and continued compliance with his restrictive covenant obligations (e.g., confidentiality, non-competition, non-solicitation and non-disparagement), and are in addition to any accrued amounts (including, other than upon a termination without good reason or for cause, any prior year’s earned but unpaid annual bonus).

In any event, if such termination occurs on or within 12 months following a “change in control” of the Company, then the award will vest in full.

With respect to Mr. Bertolini’s 2023 PSU award, upon a change in control, a number of PSUs will become earned PSUs based on the CIC price (and using straight-line interpolation for a CIC price between two price per share goals). If the PSU award is assumed by the acquiror, any earned PSUs will convert into a time-vesting award that, following the change in control, will remain outstanding and eligible to vest on the last day of the performance period, subject to Mr. Bertolini’s continued service as the CEO through such date. If the PSU award is not so assumed, 100% of any earned PSUs will vest as of immediately prior to the change in control.

In addition, on a termination of Mr. Bertolini’s service as the CEO by the Company without “cause”, by Mr. Bertolini for “good reason” or due to his death or disability, then:

The accelerated vesting provisions described above regarding Mr. Bertolini’s RSU award and PSU award are subject to Mr. Bertolini’s execution and non-revocation of a general release of claims in favor of the Company and continued compliance with customary confidentiality, non-competition and non-solicitation requirements.