Oscar, the health insurance startup co-founded by Joshua Kushner and Mario Schlosser, has raised $165 million in new venture capital funding. A source puts the post-money valuation at $3.2 billion, which is up from $2.7 billion in early 2016.

Why it matters: Oscar's growth makes it a possible takeover candidate in what has become a very hot M&A market for health care services, even if it continues to be unprofitable.

One possibility is that a rival insurer could make a play, hoping to improve its technology and telemedicine offerings. Another is that a pharmacy or other type of complimentary health care company could seek to add an insurance arm.

• Deal details: Existing investor Founders Fund led the round, and was joined by 8VC, Verily Life Sciences, Fidelity, General Catalyst, Capital G, Khosla Ventures, and Kushner's Thrive Capital. Founders Fund is known as Peter Thiel's firm, but the Oscar investment has always been led by a different partner, Brian Singerman.
• Go deeper: Oscar nears $1 billion in revenue, but heavy losses persist.