Sidecar Health, an insurance startup focused on price transparency and direct payments for care, has raised $20 million in a new round of funding announced this morning. Cathay Innovation headed the raise, with new investors Comcast Ventures, Kauffman Fellows and 23andMe CEO Anne Wojcicki joining in. Prior backers GreatPoint Ventures and Morpheus Ventures participated as well.
With this morning's announcement, Sidecar Health has raised a total of $40 million from investors.
WHAT IT DOES
The startup's strategy hinges on increased price transparency and reduced payments based on self-pay service rates. Its app allows users to customize their annual coverage amount and options, and includes a price comparison tool for viewing different services from local providers.
Meanwhile, a provided Sidecar Health Visa card tied to members' account allows payment directly at the point of service. The startup confirms these payments by asking members to upload a picture of their itemized bill.
WHAT IT'S FOR
According to the funding announcement, Sidecar Health will use these funds to push into new markets and expand its team.
“This latest funding accelerates us towards our goal of significantly lowering the cost of health care in the U.S. while increasing access to care,” Patrick Quigley, CEO of Sidecar Health, said in a statement. “Plans offered by Sidecar Health successfully address the agency problem created by traditional health insurance. By empowering patients to be purchasers of healthcare and re-aligning incentives throughout the system, Sidecar Health members benefit from lower health costs and greater access. As our membership base increases, price transparency and consumer choice push down the average price of health care services for everyone.”
Consumer-facing health-transparency apps and similar tools have had a place in digital health for some time. Medlio tackled the issue with a virtual insurance card app it released over six year ago, while last year saw the launch of CashMD's tool to search for local procedures and their cost. Shanghai-based CareVoice raised funding for its cost and quality transparency app that targets insurers,
ON THE RECORD
“We are delighted to join the Sidecar Health team on their mission to make health insurance more affordable and accessible in the U.S.,” Alexandre Lazarow, investment director at Cathay Innovation, said in a statement. “The company is reinventing healthcare insurance plans for individuals and businesses by fixing both the incentives and the lack of price transparency that have plagued the U.S. healthcare system. With Sidecar Health’s unique technology and real-price data, people have access to the cost and coverage information needed to make health care decisions that has been missing from all health care transactions until now.”