#1Q1 2018 Earnings Supplement May 8, 2018 inovalon™#2Cautionary Note Regarding Forward-Looking Statement Certain statements contained in this presentation constitute forward-looking statements within the meaning of, and are intended to be covered by the safe harbor provisions of, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements contained in this presentation other than statements of historical fact, including but not limited to statements regarding the roll-out of any product or capability, the timing, performance characteristics and utility of any such product or capability, and the impact of any such product or capability on the healthcare industry, future results of operations and financial position, business strategy and plans, market growth, and objectives for future operations, are forward- looking statements. The words "believe," "may," "see," "will," "estimate," "continue," "anticipate," "assume," "intend," "expect," "project," "look forward," and similar expressions are intended to identify forward-looking statements. Forward-looking statements in this presentation include, but are not limited to, statements regarding the expected benefits and impact of the combination of Inovalon and ABILITY, including the expected accretive effect of the merger on Inovalon's financial results, expectations about future business plans, prospective performance and opportunities, strategies and business plans, expectations regarding future results, expectations regarding the size of our datasets, and financial guidance for 2018. Inovalon has based these forward-looking statements largely on current expectations and projections about future events and trends that may affect financial condition, results of operations, business strategy, short-term and long-term business operations and objectives, and financial needs as of the date of this presentation. These forward-looking statements are subject to a number of risks, uncertainties, and assumptions, which could cause the future events and trends discussed in this presentation not to occur and could cause actual results to differ materially and adversely from those anticipated or implied in the forward-looking statements. These risks, uncertainties, and assumptions include, among others: the Company's ability to continue and manage growth, including successfully integrating ABILITY; ability to grow the client base, retain and renew the existing client base and maintain or increase the fees and activity with existing clients; the effect of the concentration of revenue among top clients; the ability to innovate new services and adapt platforms and toolsets; the ability to successfully implement growth strategies, including the ability to expand into adjacent verticals, such as direct to consumer, growing channel partnerships, expanding internationally and successfully pursuing acquisitions; the ability to successfully integrate our acquisitions and the ability of the acquired business to perform as expected; the successful implementation and adoption of new platforms and solutions, including the Inovalon ONE™ Platform, ScriptMed™ Cloud, Clinical Data Extraction as a Service (CDEaaS), and Natural Language Processing as a Service (NLPaaS); the possibility of technical, logistical or planning issues in connection with the Company's investment in and successful deployment of the Company's products, services and technological advancements; the ability to enter into new agreements with existing or new platforms, products and solutions in the timeframes expected, or at all; the impact of pending M&A activity in the managed care industry, including potential positive or negative impact on existing contracts or the demand for new contracts, the effects of and costs associated with compliance with regulations applicable to the Company, including regulations relating to data protection and data privacy; the effects of changes in tax laws in the jurisdictions in which we operate, including the Tax Cuts and Jobs Act of 2017; the ability to protect the privacy of clients' data and prevent security breaches; the effect of competition on the business; and the efficacy of the Company's platforms and toolsets. Additional information is also set forth in the Company's Annual Report on Form 10-K for the year ended December 31, 2017, filed with the SEC on February 21, 2018, included under the heading Item 1A, "Risk Factors," and in subsequent filings with the SEC. The Company is under no duty to, and disclaims any obligation to, update any of these forward- looking statements after the date of this presentation or conform these statements to actual results or revised expectations, except as required by law. Non-GAAP Financial Measures This presentation contains certain non-GAAP mea ures. These non-GAAP measures are in addition to, not a substitute for or necessarily superior to measures of financial performance in accordance with U.S. GAAP. The GAAP measure most closely comparable to each non-GAAP measure used or discussed, and a reconciliation of the differences between each non-GAAP measure and the comparable GAAP measure, is available herein and within our public filings with the SEC. All data provided is as of March 31, 2018 unless stated otherwise. INOV Q1 2018 Earnings Supplement (5.8.18) v 1.0.0 2#3Contents This presentation serves as a supplement to the Inovalon announcement on May 8, 2018 pertaining to first quarter (Q1) of 2018 results and guidance¹. The Company's previously provided 2018 Guidance of March 7, 2018 remains unchanged, except for the impact of interest expense. INOV Q1 2018 Earnings Supplement (5.8.18) v 1.0.0 1. Acquisition of ABILITY Network 2. Inovalon ONETM Platform Capability Expansion 3. Subscription Base Progression, G&A, and Capital Expenditure Insights 4.2018 Guidance 3#4A Powerful Combination During Q1 of 2018, the Company announced a definitive agreement to acquire ABILITY Network, Inc. ("ABILITY"). The acquisition closed on April 2, 2018. The combination of Inovalon and ABILITY creates a vertically integrated leader in cloud-based enablement of data-driven, value-based care. Inovalon patient and medical event data counts are as of March 31, 2018. INOV Q1 2018 Earnings Supplement (5.8.18) v 1.0.0 inovalon Through the Inovalon ONETM Platform, Inovalon supports cloud-based, real-time connectivity, analytics, interventions, and data visualization for hundreds of the nation's leading health plans, pharmaceutical companies, medical device manufacturers, and integrated provider organizations informed by the data of more than 243 million patients and 38 billion medical events¹. + ABILITY Through the myABILITY® Platform, ABILITY supports cloud-based, real- time connectivity and analytics, helping providers and payers simplify the complexities of healthcare through innovative, integral and integrated applications at more than 44,000 acute, post-acute, and ambulatory provider sites.#5inovalon + ABILITY™ A vertically integrated cloud-based platform empowering the achievement of real-time value-based care from payers, pharmaceutical companies, device manufacturers, and diagnostics all the way to the patient's point of care. INOV Q1 2018 Earnings Supplement (5.8.18) v 1.0.0 Payers +HORTIN+ Acute Providers Pharma 10:30 101007 0101000 QUOTED Massive Data Assets Devices 1010100 0010001 0011 001. The Inovalon ONE™ Platform Q Advanced Analytics Diagnostics F Home Care SNF Hosplos Post-Acute Providers XX Intervention Toolsets VO Ambulatory Providers tic Data Visualization 15#6Meaningful Benefits to Healthcare Together, Inovalon and ABILITY will bring capabilities unparalleled in empowering a comprehensive vertical integration of value-based healthcare. Meaningful Benefits to Stockholders Together, Inovalon and ABILITY will achieve a multitude of very positive business model and economic factors. INOV Q1 2018 Earnings Supplement (5.8.18) v 1.0.0 Achieves a vertically integrated cloud-based platform that empowers the achievement of real-time, value-based care from payers, manufacturers, and diagnostics all the way to the patient's point of care Expands on the data scale, connectivity, and impact reach of data-driven healthcare for the entirety of the healthcare ecosystem Leverages and Enhances Datasets Expands Connectivity Efficiencies Expands Patient-Level Impact Reach Provides Distribution Channel for Applications Expands and Increases Addressability of TAM Diversifies Customer Size Diversifies Customer Mix Decreases Customer Concentration Increases Competitive Differentiators Increases Sales Channel Increases Subscription-Based Revenue & Visibility Increases Margins Highly Accretive 6#7Expanding Connectivity The addition of ABILITY's extensive connectivity with provider facilities and their information systems will enhance Inovalon's market differentiation, growth opportunities, and cost efficiencies. Inovalon's interoperability technology enables real-time, bi-directional data aggregation and point-of-care intervention through Electronic Health Record (EHR) systems, Health Information Exchanges (HIE) systems, and direct-connect systems, driving positive impact and efficiency for clients, clinicians, patients, and the Company. INOV Q1 2018 Earnings Supplement (5,8,18) v 1.0.0 Clinician Count 140,000 120,000 100,000 80,000 80.000 40,000 20.000 0 CLINICIAN CONNECTIVITY GROWTH Illustrative of addition through combination 4013 1014 2014 3014 4014 1015 2015 3015 4015 1016 2016 3016 4016 1017 2017 3017 4017 1018 7#8Expanding Datasets The addition of ABILITY's extensive datasets further expands Inovalon's analytical capabilities and market differentiation, driving accelerated growth opportunities. As of the end of Q1 2018, prior to the addition of data from ABILITY: One of the industry's largest independent healthcare datasets, with more than 243M patients and 38B medical events Primary-sourced, longitudinally-matched, with data from all major U.S. healthcare programs Contains EHR, claims, scripts, labs, provider, demographic data & more Qualified Entity (QE) containing CMS Fee for Service Medicare Data Empowers and informs our industry-leading analytics, creating differentiation and client value INOV Q1 2018 Earnings Supplement (5.8.18) v 1.0.0 Medical Event Count (billions) ===============829ERSIONIS 38 37 36 34 33 31 30 20 19 18 17 18 15 13 12 11 1.0 9 7 6 B 4 0 MORE² REGISTRY DATASET GROWTH Illustrative of addition through combination Patient Count Medical Event Count wwwm tk 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 1018 湖州润华过测出而倔圆m离国magn的剪构和凶值1 250 200 200 190 100 170 150 150 120 110 100 190 70 00 50 40 30 20 10 0 Patient Count (millions) 8#9Expand Reach & Accelerate Impact Together, Inovalon and ABILITY empower real-time insight and impact, expanded reach and value achievement from the payer, pharmaceutical company, device manufacturer, and diagnostic, all the way down to the provider and patient at the point-of-care. re ||||| 100s Payers, Pharma, Device, and Diagnostics Organizations 243M+ Patients 50K+ Provider Sites INOV Q1 2018 Earnings Supplement (5.8.18) v 1.0.0 Alaska Hawaii CABILITY Provider Sites (0) Inovalon Headquarters = Office/Data Center Location KEY tych no The MOHL bly wackel went interk Puerto Ricc 9#10Exceptional Opportunity for New Product Development The point-of-care presence and the in-workflow nature of the myABILITY® workspace, coupled with the client base and capabilities of the Inovalon ONETM Platform, provides extensive opportunity for new product development throughout the customer stack.1 See deal announcement of March 7, 2018 for Ilustrative examples. INOV Q1 2018 Earnings Supplement (5.8.18) v 1.0.0 Sample Revenue Synergy Opportunities: • Expanded Ambulatory Provider Value Realization • Efficient Payer & Provider Encounter Facilitation Advanced Post-Acute Care Provider Support • Integrated Specialty Pharmacy Coordination • Data-Driven Clinical Trial Process Support Connected, Tech-Enabled Clinics 10#11Synergistic Growth Acceleration 1) Infusing Inovalon's data and analytics into ABILITY's offerings empowers new products and greater differentiation to expand and accelerate growth in ABILITY's core client audience. 2) Applying ABILITY's sales techniques to Inovalon's Platform capabilities allows the combined organization to accelerate sales into the "medium-scale" customer market. 3) Combining capabilities enables new and more vertically integrated offerings which appeal to both organizations' traditional market base, supporting expanded sales. Traditional ABILITY Network Engagements Traditional Inovalon Engagements New Engagements 3 3 2 Smaller-Scale Customer Engagements < $100K Provided for illustrative purposes only INOV Q1 2018 Earnings Supplement (5.8.18) v 1.0.0 Medium-Scale Customer Engagements $100K-$1M 1 3 3 3 Larger-Scale Customer Engagements > $1M 11#12Contents This presentation serves as a supplement to the Inovalon announcement on May 8, 2018 pertaining to first quarter (Q1) of 2018 results and guidance¹. The Company's previously provided 2018 Guidance of March 7, 2018 remains unchanged, except for the impact of interest expense. INOV Q1 2018 Earnings Supplement (5,8,18) v 1.0.0 1. Acquisition of ABILITY Network 2. Inovalon ONETM Platform Capability Expansion 3. Subscription Base Progression, G&A and Capital Expenditure Insights 4.2018 Guidance 12#13ScriptMedTM Cloud Bringing together scale, robustness, cost efficiencies, and advanced analytics, the introduction of ScriptMed™ Cloud, powered by Components of the Inovalon ONETM Platform, will enable unmatched functionality and financial benefits for the specialty pharmacy marketplace and the patients they serve. Connected Parties Health Plans BE FEME 00 Hospitals & Health Systems K Data Supplementation HUB Provided for illustrative purposes only EHRS & HIES Pharmaceutical XX 1000 Diagnostic Platforms ScriptMed™ Cloud A Configuration of the Inovalon ONE™ Platform MORE Registry 001001000044004000401411003 Laboratory Systems UTU TUTO001000111000000100100001101/ 0100001100100010111100000111000% 200110010001011110000011100010101000100 & Suppliers0101010001000111000000100100001101000100101010001000110000001001000010100010010001010 INOV Q1 2018 Earnings Supplement (5.8.18) v 1.0.0 Reporting & Visualization 1! Contract Management Clinical Care Management Analytics Referral Management Physicians & Practice Groups Technicians 100 Oboati ScriptMed™ Cloud Users Specialty Pharmacies 310100010001110000AGEM 100XXD110100010010001101000 Order Management Inventory Management Nurses 11 001010100010001110000 0110010001011110000011 00101010001000110000001 O ⠀⠀⠀⠀ +cu+ 00100010111100000111000101010001000111000000 Revenue Cycle Management Order Fulfillment Patients 13#14TM ScriptMed ™M Cloud Advanced Capabilities The ScriptMedTM Cloud configuration of the Inovalon ONETM Platform brings together large-scale data assets, connectivity, analytics, and cloud-based speed to the high- complexity and high-cost arena of specialty pharmacy. Meaningful Differentiation The Platform's capabilities meaningfully reduce time-to-fill, costs, and error rates, while empowering advanced functionality, greater flexibility, operational efficiency, and a focus on clinical and quality outcomes. INOV Q1 2018 Earnings Supplement (5,8,18) v 1.0.0 Sophisticated clinical protocols powered by patient-specific data and advanced analytics Extensive connectivity with EHRS, HIEs, payer systems, and provider- sites to speed necessary data capture and authorization processes Modular design allowing health plans and provider systems to integrate more easily with in-house capabilities and other third-party pharmacy solutions Real-time analytics and data accessibility to timely inform clinical interactions and improve patient experience Simultaneous multi-stakeholder coordination enabling parallel processes related to each unique patient's needs, materially accelerating time-to-fill improvements Real-time process coordination of patient-level and provider-level data with all elements of care management, referral management, order fulfillment, order management, inventory management, revenue cycle management, and relevant contract management supporting payer and pharmaceutical manufacturer requirements Highly granular business intelligence tracking and reporting to deliver insights on system, financial, clinical, and operational status and performance in real-time 14#15CDEaaS Inovalon's Clinical Data Extraction as a Service (CDEaaSTM) leverages the Inovalon ONETM Platform's extensive real-time connectivity, datasets, and large-scale compute processing capacity to autonomously identify and aggregate medical record data faster, at lower costs, and with greater quality control than the marketplace's traditionally labor-based approach. Clients simply submit data detailing patients for which clinical data is needed, and the Inovalon CDEaaS capability identifies where within the healthcare ecosystem the data may reside and automatously captures the data, rendered in CMS-compliant and NCQA-compliant formats for a wide array of applications. Health Plans Hospitals & Health Systems Client Organizations + MO 669 TM Provided for illustrative purposes only 000001001110100011010010011101000110 Regulators & 01110100011010010011 Oversight 00011010010011101000 Bodies 0001101001001110100 CDEaaS™ An offering of the Inovalon ONE™ Platform INOV Q1 2018 Earnings Supplement (5.8.18) v 1.0.0 Pharmaceutical 1010010 Requests For & Medical Device Medical Records Companies Cloud-Based Provider Practice Solo Direct- 1101000 Network EHR Group EHR Practice EHR Connect EHR 100100111 Gred Analysics MORE² Registry 01101001101001001110100011010100111010001101001011110001040m Resulting Files Returned Autonomously 100011110 1000110111010 10011101 11010010010 2001040010011 100111010011010010011110001010111 DETTEBRERO 2014 M0040 0111 State HIE Regional HIE City HIE CAD Cloud-Based Hospital EHR00010 EHR101 011000 KARTON A - Provider HIE Hospital HIE Cloud-Based HIE 15#16NLPaaS™ Inovalon's Natural Language Processing as a Service (NLPaaS™M) leverages the Inovalon ONETM Platform's highly adaptive, machine learning capabilities and billions of known medical events to transform unstructured clinical data into highly valuable, structure clinical data and analyzed results at massive scale in fractions of a second. Inovalon's NLPaaS solution empowers health plans, hospitals, regulators, and life sciences companies to convert the myriad of healthcare data that exists in unstructured formats into discrete data and analyze the results for issues of clinical quality, risk, disease outcomes, and cost implications rapidly, autonomously, and cost effectively. 100111010001101 110100011010010011101000110 1001 Unstructured Clinical Data 101001001110100014 100011010010011101000 00110100100111010 0110100100111010001101 *Provided for illustrative purposes only NLPaaS™ An offering of the Inovalon ONE™ Platform — INOV Q1 2018 Earnings Supplement (5.8.18) v 1.0.0 MORE* Registry Resulting Structured Data and Analyses 1M1000N 2010001 2011 3011 11010001101001001110 1010001101001001110 11010110100001101000110100100111010001001 01101001001110100011010010011101 1101001001110100011010010011101000 011010010011101000110100 0010400100111010001101001001110 1010100 BRICEN 00110 14-1 10001101001001110 1000110100100111010 STORE 1010001 2011001 3310000 CHIQI BIOID CHATOI 31010 • 1110010101110110000111 Raw Structured 011000111 Data Files Data Analytical con Result Files Annotated Medical Record Cross- Walks for Audit Trail Purposes 16#17CDEaaS & NLPaaS TM TM Broad Need More than a 100 million medical records are sought for review and analysis every year within the United States. The need to access this deep clinical data is growing at tremendous rates as the market increasingly focuses on outcomes, compliance, and financial performance. Easier access, faster speeds, and lower costs are seen to even further drive demand. Highly Scalable The Inovalon CDEaaSTM and NLPaaST offerings are able to access and analyze massive amounts of clinical data at ultra-high speeds in massive scale. INOV Q1 2018 Earnings Supplement (5.8.18) v 1.0.0 TM Faster: Results come back in minutes to hours, not weeks to months typically required by alternative, labor-based medical record collection approaches More Comprehensive Results: Clients often are unaware of where patients' clinical data actually resides - a problem solved by Inovalon's datasets of billions of medical events Highly-configurable: accepts various document types at massive scale, leveraging ML capabilities for document prioritization and condition detection Higher Quality: Platform-based data aggregation and machine learning on millions of medical record review training cycles avoids human error and allows for analytical process controls resulting in a vastly superior overall data quality Greater Operational Flexibility: No need to plan for staffing, training, and project coordination. The Inovalon Platform is always ready for requests Lower Costs: Much less expensive than the costs of alternative, labor-based medical record collection and analysis approaches 17#18Contents This presentation serves as a supplement to the Inovalon announcement on May 8, 2018 pertaining to first quarter (Q1) of 2018 results and guidance¹. The Company's previously provided 2018 Guidance of March 7, 2018 remains unchanged, except for the impact of interest expense. INOV Q1 2018 Earnings Supplement (5.8.18) v 1.0.0 1. Acquisition of ABILITY Network 2. Inovalon ONETM Platform Capability Expansion 3. Subscription Base Progression, G&A and Capital Expenditure Insights 4.2018 Guidance 18#19Subscription-Based Progression Inovalon continues to transition its clients to subscription-based platform offerings from legacy solutions. In Q1 2018, Inovalon generated 74% of revenues from subscription-based platform offerings as compared to 68% in Q1 2017. Excluding client ACA withdrawal impact, sequential subscription-based platform revenue grew 6%, or 27% annualized, from Q4 2017 to Q1 2018. $115.9 $110.6 66% 66% ⠀⠀ 16% 21% 21% 13% 13% $108.3 All numbers in milions. 16% 01 2017 02 2017 2017 Services INOV Q1 2018 Earnings Supplement (5.8.18) v1.0.0 $114.6 63% 20% 17% Q4 2017 $4.4 Excluding Client ACA Withdrawal. Subscription- Based Platform Sequential Growth of 6%, and Annualized Growth of 27% Subscription- Besed Platform Growth ($9.3) Cilent ACA Withdrawal Impact Legacy Solutions ($5.6) Legacy Solution Contract Conversion Impact ($5.3) ($4.2) Client Chum ($1.7) Impact of Service Fees Not Charged in Advance of Anticipated Contract Conversion to Subscription-Based Contracts Subscription-Based Platform Offerings Impact of Seasonal Services $92.8 74% 11% 15% 01 2018 19#20Adjusting for Non-comparable G&A General and administrative expenses increased $13.6M in Q1 2018 as compared to Q1 2017. The increase was driven by $4.8M in non- comparable items that do not otherwise relate to Inovalon's ongoing performance, $4.4M in acquired G&A associated with the CCS acquisition, and $4.3M in combined employee-related and professional fees associated with the Inovalon ONETM Platform development, launch, and associated data center expansions. Additionally, certain G&A expense synergies have been implemented and achieved in Q1 2018 reducing expenses by approximately $2.5M on average per quarter going forward. Normalized for certain non-comparable or one-time expenses, Inovalon's quarterly G&A expense is expected to range between $40M to $44M during the three remaining quarters of 2018 excluding G&A related to the acquisition of ABILITY, and $49M to $53M including ABILITY. Non-Comparable or One-Time Expenses $35.8 $3.2 Q1 2017 Employes-Related Professional Actual Expenses Acquired GMA Tranestion INOV Q1 2018 Earnings Supplement (5.8.18) v 1.0.0 IPO Levit Legal Foo $0.6 Other Non-Recurring * Normalized G&A exdudes the impact from fair valus contingent consideration accration measurement. All numbers in milions, subject to rounding $49.4 01 2018 Actual ($4.8) ($2.5) One-Time Expensse Excluding ABILITY Non-Comparable Acquired GA Expense Synergy Pre-ABILITY $44.0 $40.0 Normalbad 02-04 2018 Quarterly Expense Excl. ABILITY™ $9.0 Quarterly ABILITY GAA Including ABILITY $53.0 $49.0 Normalized 02-04 2018 Quarterly Expen Ind. ABILITY™ 20#21CAPEX Returning Towards Historical Levels During the period Q3 2016 through Q1 2018, the Company elected to invest more than $40M into incremental development towards the launch of the Inovalon ONE™ Platform. The period of this disproportional investment is now nearly complete and is increasingly being harvested through the successful engagement of clients for highly-differentiated platform offerings. As a result, the Company sees the capital investments of the Company (inclusive of ABILITY) returning materially towards historical levels (as a percentage of revenue) in 2018. $18.8 6% $13.2 $5.6 2013 Maintenance Capital Expenditure $22.7 $20.2 INOV Q1 2018 Earnings Supplement (5.8.18) v 1.0.0 $2.5 2014 $26.4 6% $25.2 $1.2 2015 Innovation Capital Expenditure (incl. Cap. Software) Capital Expenditure (CAPEX) is defined as the sum of Purchases of property and equipment and Investment in capitalized software. All numbers in millions. $39.1 9% $23.2 $85.5 $28.1 15% $28.5 2016 2017 Inovalon ONE™ Platform Buildout Capital Expenditure Inclusive of ABILITY $50 - $55 $6-57 $31 - $33 8%-9% $13-$15 2018G % Of Revenue 21#22Contents This presentation serves as a supplement to the Inovalon announcement on May 8, 2018 pertaining to first quarter (Q1) of 2018 results and guidance¹. The Company's previously provided 2018 Guidance of March 7, 2018 remains unchanged, except for the impact of interest expense. INOV Q1 2018 Earnings Supplement (5.8.18) v 1.0.0 1. Acquisition of ABILITY Network 2. Inovalon ONETM Platform Capability Expansion 3. Subscription Base Progression, G&A and Capital Expenditure Insights 4.2018 Guidance 22#23Revenue Offering Mix The following guidance, previously provided on March 7, 2018, is being reaffirmed. All numbers in milions. $437.3 53% 43% 2015 Services INOV Q1 2018 Earnings Supplement (5.8.18) v 1.0.0 $427.6 54% 34% 12% 2016 Legacy Solutions $449.4 66% 19% 15% $568 - $593 2017 -75% -13% -12% 2018G Subscription-Based Platform Offerings 23#24Revenue The following guidance, previously provided on March 7, 2018, is being reaffirmed. 13% $240 2011 2011-2018G CAGR $300 2012 $296 INOV Q1 2018 Earnings Supplement (5.8.18) v 1.0.0 2013 Note: CAGR calculations undertaken to the mid-point of 2018 Guidance. Al numbers in milions $362 2014 $437 2015 $428 2016 $449 2017 $568 - $593 2018G 24#25Adjusted EBITDA The following guidance, previously provided on March 7, 2018, is being reaffirmed. 17% $58 24% 2011 2011-2018G CAGR $108 36% 2012 $72 INOV Q1 2018 Earnings Supplement (5.8.18) v 1.0.0 24% 2013 Note: CAGR calculations undertaken to the mid-point of 2018 Guidance. All numbers in milions $134 37% 2014 % of Revenue $152 35% 2015 $100 23% 2016 $109 24% 2017 $163- $174 29% 2018G 25#26Cash Flow From Operations The following is newly provided guidance for 2018. 11% $46 19% 2011-2018G CAGR 2011 $54 18% $66 2012 22% $86 2013 24% $68 16% $93 2015 22% $98 2016 22% 2014 % of Revenue Note: CAGR calculations undertaken to the mid-point of 2018 Guidance. All numbers in millions 20180 presents both GAAP and Non-GAAP in order to highlight the one-time exclusion of acquisition-related transaction and integration costs. See Non-GAAP reconciliation on Slide 33. Black dotted line represents the midpoint of the GAAP guidance range. Percent (%) reflects Non-GAAP as a percent of revenue INOV Q1 2018 Earnings Supplement (5.8.18) v 1.0.0 $104 - $115 (Non-GAAP) ¹ 2017 $90-$100 (GAAP) ¹ -19% -18% 1 2018G 26#272018 Revenue Guidance Bridge Inovalon continues to transition its business to an increasingly subscription-based cloud- based platform model. The Company's advancing capabilities and technologies continue to be positively recognized in the marketplace, in addition to the in-year contribution from the ABILITY acquisition. At the same time, external market forces related to the ACA are a short-term opposing force in 2018. This combination of factors in 2018 yields full- year revenue guidance of $568M to $593M, or expected revenue expansion of 29% at the midpoint. The graphic to the right is for illustrative purposes only. INOV Q1 2018 Earnings Supplement (5,8,18) v 1.0.0 Net Client Churn expected to be -5 points in 2018 • Client decisions to withdraw from ACA markets, unrelated to the efficacy of Inovalon services, is a short-term headwind of -8 points in 2018, most pronounced in 1H 2018 Continued transition and expansion of Inovalon ONETM Platform adoption is seen driving new platform client sales of -16 points of growth in 2018 ABILITY acquisition expected to contribute 24 points of revenue growth 5449.4 2017 Actual Revenue Full Year 2017 vs. 2018 Guidance Revenue Growth of 29% at the Midpoint --(5 pts) Net Client Chum -(8 pts) Client ACA Withdrawals -16 pts New Client Sales -2 pts CCS Acquisition in 2017) -24 pts ABILITY Acquisition $593 $588 2018 Revenue Guidance 27#282018 Adjusted EBITDA Margin Bridge Inovalon continues to expect operating leverage, driven by further improvement in mix and pricing, benefit from technology-enabled efficiency initiatives, and contribution from ABILITY. The Company sees these factors driving -470 basis points of Adjusted EBITDA margin expansion in 2018. The graphic to the right is for illustrative purposes only. INOV Q1 2018 Earnings Supplement (5,8,18) v 1.0.0 The full gross margin benefit of an increasing mix of higher margin Platform offerings, coupled with continued technology-enabled efficiencies and the ABILITY acquisition, is seen to be partially offset by one-time client ACA withdrawals Efficiencies achieved in overhead are expected to fully offset continued investments in strategic areas for the Company FY 2017 Adj. EBITDA Margin -470 Basis Point Year-to-Year Improvement -20 bps Investment Initiatives/ Overhead Efficiencies -10 bps -20 bp-a Platform Mx & Price Changes Represents -30 bps of Gross Marg Expansion YTT Excluding ABILITY -360 bps Gross Margin Expansion YTY including ABILITY -330 bpe Platform Efficiencies -90 bpa ABILITY ABILITY Operating Flatform Contribution Contribution 29.0% FY 2018G Adj. EBITDA Margin 28#29Financial Guidance Table The Company is reaffirming financial guidance provided on March 7, 2018 except for the impact of interest expense. 2018 interest expense is expected to be $48M to $49M (inclusive of $4M in original issuance discount and debt issuance fee amortization), an increase of $10M to $11M from the Company's preliminary financial guidance issued on March 7, 2018. The increase reflects the Company's fixing $600M of the Company's Term Loan B LIBOR interest rate component, and terms of the finalized Credit Agreement (dated April 2, 2018). Financial Metric Updated 2018 Financial Guidance $568 million to $593 million ($13 million) to ($5 million)¹ $46 million to $55 million $163 million to $174 million DAST $90 million to $100 million $104 million to $115 million $50 million to $55 million Previous (3/7/18) 2018 Financial Guidance $568 million to $593 million ($5 million) to $3 million¹ $52 million to $61 million $163 million to $174 million JUDANDESAM Revenue Net (Loss)/Income Non-GAAP net income Adjusted EBITDA Net Cash Provided By Operating Activities Non-GAAP Net Cash Provided By Operating Activities Capital Expenditure Diluted net (loss)/income per share² ($0.03) to $0.02 ($0.09) to ($0.03) $0.32 to $0.38 Non-GAAP diluted net income per share² $0.36 to $0.42 GAAP net (lossincome includes estimated: one-time transaction costs of $4.0 million, non-neurring integration costs of $7.5 million, and deal-related intangible asset amortization of $21.0 million with an astmated 15 year useful life (totaling approximately $32.5 milion) The Company is assuming 146 million weighted average diluted shares and an effective tax rate of approximately 30% for the full year 2018. INOV Q1 2018 Earnings Supplement (5.8.18) v 1.0.0 29#30Appendix INOV Q1 2018 Earnings Supplement (5.8.18) v 1,0,0 30#31Reconciliation of Forward-Looking Guidance Adjusted EBITDA Inovalon defines Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (Adjusted EBITDA) as net income calculated in accordance with GAAP, adjusted for the impact of depreciation and amortization, realized losses on short-term investments, loss (gain) on disposal of equipment, interest expense, interest income, provision for income taxes, stock-based compensation, acquisition costs, tax on equity exercises, and other non-comparable items. Adjusted EBITDA margin is defined as Adjusted EBITDA as a percentage of revenue. A reconciliation of forward-looking preliminary net income guidance to forward-looking preliminary Adjusted EBITDA guidance follows: (In millions) Reconciliation of Forward-Looking Guidance Net Income to Adjusted EBITDA: Net (loss)/income Depreciation and amortization Interest expense Interest income Realized losses on short-term investments (Benefit)//provision for income taxes (1) EBITDA Stock-based compensation Acquisition costs: Transaction costs Integration costs Contingent consideration accretion Compensatory contingent consideration Other non-comparable items (2) Adjusted EBITDA Adjusted EBITDA Margin $ $ Guidance Range Twelve Months Ending December 31, 2018 High Low 86 49 (1) 1 (6) 116 20 5 9 6 2 5 163 28,7% $ S (5) 86 (1) + (3) 126 20 5 10 5 174 29.4% m A 30% tax rate is assumed in order to approximate the Company's offective corporate tax rate. Other "non-comparable items include items that are not comparable across reporting periods or items that do not otherwise relate to the Company's ongoing financial results, such as certain employee related expenses attributable to advancements in automation and operational efficiencies. Non-comparable items are excluded from Adjusted EBITDA in order to more effectively assess the Company's period over period and on going operating performance. INOV Q1 2018 Earnings Supplement (5,8,18) v 1.0.0 31#32Reconciliation Non-GAAP Net Income of Forward-Looking Guidance Inovalon defines Non-GAAP net income as net income calculated in accordance with GAAP, adjusted to exclude tax-affected stock-based compensation expense, acquisition costs, amortization of acquired intangible assets, tax on equity exercises and other non-comparable items. A reconciliation of forward-looking preliminary net income to forward-looking preliminary Non-GAAP net income follows: (In millions, except per share amounts) Reconciliation of Forward-Looking Guidance Net Income to Non-GAAP net income: Net (loss)/income Stock-based compensation Acquisition costs: Transaction costs Integration costs Contingent consideration accretion Compensatory contingent consideration Amortization of acquired intangible assets Other non-comparable items (1) Tax impact of add-back items (2) Non-GAAP net income GAAP diluted net (loss Mincome per share Non-GAAP diluted net income per share Weighted average shares of common stock outstanding-diluted 44 INOV Q1 2018 Earnings Supplement (5,8,18) v 1.0.0 $ $ $ $ Guidance Range Twelve Months Ending December 31, 2018 High Low (13) $ 20 5 9 6 2 36 5 (24) 46 (0.09) 0,32 146 $ $ (5) 20 5 10 6 2 36 5 (24) 55 (0.03) 0.38 146 Other "non-comparable items include items that are not comparable across reporting poriods or items that do not otherwise nalate to the Company's ongoing financial results, such as cortan employee related expenses attributable to advancements in automation and operational efficiencies. Non-comparable items are excluded from Non-GAAP net income in order to more effectively assess the Company's penod over period and on going operating performance. A 30% tax rate is assumed in order to approximate the Company's effective corporate tax rate. 32#33Reconciliation of Forward-Looking Guidance Non-GAAP Net Cash Provided By Operating Activities Inovalon defines Non-GAAP net cash provided by operating activities as net cash provided by operating activities calculated in accordance with GAAP, adjusted to exclude transaction and intergration acquisition costs. A reconciliation of forward-looking preliminary net cash provided by operating activities to forward-looking preliminary Non-GAAP net cash provided by operating activities follows: (In millions) Reconciliation of Forward-Looking Guidance Net Cash Provided by Operating Activities to Non-GAAP Net Cash Provided by Operating Activities: Net cash provided by operating activities Acquisition costs: Transaction costs Integration costs Non-GAAP net cash provided by operating activities INOV Q1 2018 Earnings Supplement (5,8,18) v 1.0.0 S $ Guidance Range Twelve Months Ending December 31, 2018 Low High 90 5 9 104 S S 100 5 10 115 33#34Healthcare Empowered inovalon™