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Patrick Quigley of ‘Sidecar Health’: “High Deductible Plans”

High Deductible Plans. — This may seem counter-intuitive because high deductible health plans lower the monthly cost of insurance premiums so that more people can afford coverage. But are people getting what they pay for? These plans simply shift costs from insurance companies to patients. With deductibles averaging 5,000 dollars+ per person and annual premiums being 6,000 […]

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High Deductible Plans. — This may seem counter-intuitive because high deductible health plans lower the monthly cost of insurance premiums so that more people can afford coverage. But are people getting what they pay for? These plans simply shift costs from insurance companies to patients. With deductibles averaging 5,000 dollars+ per person and annual premiums being 6,000 dollars per year*, people can spend over 11,000 dollars on care and insurance before getting anything back (besides an annual check-up, which would cost under 300 dollars if the patient paid for the appointment themselves when they went to the doctor).


As a part of my interview series with leaders in healthcare, I had the pleasure to interview Patrick Quigley.

Patrick is responsible for building and leading the Sidecar Health team to achieve its mission: to make health insurance more affordable and access to great health care more attainable for everyone in the US. Patrick has more than 20 years’ experience in sales, marketing, product management and engineering with both public and private companies. Prior to co-founding Sidecar Health, Patrick was Chief Executive Officer at Katch, whose primary business helped carriers enroll new members in individual health plans. Before leading Katch, Patrick was Senior Vice President and part of the founding management team at QuinStreet, Inc. that grew the company to its IPO. Patrick also held marketing and sales executive leadership positions at BEA Systems, and was a consultant at McKinsey & Company. He holds an MBA from The Wharton School at the University of Pennsylvania and received his B.S. in engineering from Duke University.


Thank you so much for doing this with us! Can you tell us a story about what brought you to this specific career path?

I had an “aha” moment a couple of years ago when I needed an MRI and was charged 1,300 dollars through my traditional health insurance plan. When I needed the same MRI again, I asked the doctor’s office if I could pay in cash; they informed me the self-pay price would be 330 dollars. I was completely taken aback at the difference in price. At the same location for the same procedure with the same doctor, there was 970 dollars of savings when I self-paid. This event inspired the “self-pay” or “real-price” model upon which we built Sidecar Health.

Before starting Sidecar Health, my team and I were running a business that helped millions of people shop for insurance, and we saw over and over that affordability was the #1 issue. So, our focus shifted towards significantly lowering the cost of insurance.

The cost of insurance comes down to math: the likelihood of claims times the cost of those claims. My personal experience with the MRI showed me that when patients pay for care when they get it — “self-paying” — it is typically a lot less expensive. (We didn’t discover this fact — it’s been heavily documented by every major newspaper). Building an insurance product around “self-pay” lowers the cost of claims, which then lowers the cost of insurance. Effectively, we designed a product where everyone could save the “970 dollars” on every healthcare transaction. At that point, we knew we were onto something special.

Can you share an interesting story that happened to you since you began leading your company?

When we were initially raising venture funding for Sidecar Health in 2018, there was one investor meeting where I realized just how stuck the healthcare industry is in its existing approach. After pitching the investor, he said: “Healthcare is hard. Before you try to fix it, why not start with something much easier? Why don’t you first build a better search engine than Google and come back? When you have done that, I’ll consider investing in your new approach to health insurance”

While you can’t judge the healthcare industry on one person’s response (and we clearly haven’t had trouble finding amazing investors), it is noteworthy how flippantly one particular healthcare investor rejected the idea of leveraging “self-pay” and transparency to lower health insurance costs. It solidified my belief that health insurance can’t be fixed incrementally. What we need is to take a whole new approach to find a sustainable path to lower costs and increase access for everyone.

Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lesson you learned from that?

Early on, our founding team (our self-named First Five) was just getting started and needed to get headshots done for our website. In classic startup fashion, we found the cheapest option and went for it. We were quoted 100 dollars for all 5 headshots and arrived a few days later at what appeared to be an abandoned shopping mall, with a studio that was locked behind a chained security gate in the middle of the day. While the subsequent “portrait session” was a very memorable and laughable event, we learned our lesson: next time, hire a pro.

What do you think makes your company stand out? Can you share a story?

What makes us stand out is that the plans we offer are fundamentally different than any other health insurance in the U.S. We give our members a Visa card with up to 2 million dollars of coverage and tell members to buy care when they need it. We combine this buying power with a mobile app that tells members exactly what their coverage is and what a fair price is for every prescription and medical service available in the U.S. Members can see any doctor they want (because everyone takes Visa) and our members save 40% relative to what traditional insurance costs. Everybody talks about affordability and transparency, but we’re really doing it — and we’re doing it in a way that puts consumers first at every turn.

Unlike traditional insurance, Sidecar Health is turning patients into purchasers of healthcare. Because our members look up their benefit amounts in the Sidecar Health app before they get care, they can shop for care as they would for any other consumer good. If their provider charges more than the benefit amount, members know exactly what their portion is and there are never any surprises. If the benefit amount is more than the provider changes — which members see a lot — the member gets to pocket the difference. Does your insurance do that?

Our big picture view is that by bringing market forces to healthcare through transparency and removing administrative costs of traditional insurance from the healthcare system, we can lower the cost of care for everyone — whether they are using our product or not.

What advice would you give to other healthcare leaders to help their team to thrive?

The number one thing I would recommend is to be open-minded about what needs to happen in order to implement real change. We can fix healthcare for everyone, but incrementing won’t get us there. We have to reimagine the whole system with the end result in mind: to make healthcare affordable and accessible for all.

While the government is doing the best they can, the private industry is in a position to do much, much more. We need to put all of our focus into transparency and consumer choice. Both of these will create a viable path to sustainable affordability.

Ok, thank you for that. Let’s jump to the main focus of our interview. According to this study cited by Newsweek, the US healthcare system is ranked as the worst among high income nations. This seems shocking. Can you share with us 3–5 reasons why you think the US is ranked so poorly?

1. Lack of Transparency.

Can you imagine going into McDonalds for a burger and fries and being charged a co-pay of 5 dollars, only to receive a 300 dollars bill ninety days later because the “fry guy” was out of network? That’s happening in healthcare every day. Without price transparency, there is no accountability for exorbitant health care pricing. One provider will charge 725 dollars for a simple blood test, while another charges 11 dollars for that same test.*

If prices were transparent for patients, like they are at McDonalds, the provider charging 725 dollars would lose all their business to the 11 dollars provider, or they would be forced to lower prices to remain competitive. Patients don’t realize they are actually purchasing care when they get it — that is, until they get the bill. Without transparency, prices for health care services will stay high and, as a result, insurance prices will stay higher than they should be. This is by far the biggest issue facing the U.S. healthcare system.

2. High Deductible Plans.

This may seem counter-intuitive because high deductible health plans lower the monthly cost of insurance premiums so that more people can afford coverage. But are people getting what they pay for? These plans simply shift costs from insurance companies to patients. With deductibles averaging 5,000 dollars+ per person and annual premiums being 6,000 dollars per year*, people can spend over 11,000 dollars on care and insurance before getting anything back (besides an annual check-up, which would cost under 300 dollars if the patient paid for the appointment themselves when they went to the doctor).

3. Limited Provider Networks.

Traditional health insurance comes severely constrained with limited doctor networks. That means when patients need care, they cannot always get it within their network. This is especially challenging in rural areas or areas without major medical systems. It also effects everyone in emergency situations when doctors are often not “in network”, even if the hospital is. Health insurance is about providing security, but networks are frequently opaque. In emergency situations when people need care immediately, they end up with surprise bills due to a lack of coverage they (reasonably) thought they had.

4. Misaligned incentives.

Under the Affordable Care Act, major medical insurance providers must pay 80% of the premiums they collect on medical expenses. At first this sounds like a great idea; however, it has major unintended consequences. Since insurance companies can only keep 20% of monthly premiums for admin and profit, the only way they can increase their profit is by increasing their premiums. The only way they are allowed to increase their premiums is to spend more on medical expenses. This is one of the reasons why our medical expenses and insurance costs have grown faster than other nations; health insurance companies have an incentive to pay more for medical expenses in order to keep more for themselves.

You are a “healthcare insider”. If you had the power to make a change, can you share 3* changes that need to be made to improve the overall US healthcare system? Please share a story or example for each.

  1. Change patients into purchasers. — In every other business, the customer decides what to buy and what to pay for it. This simple approach creates efficient markets and drives costs down. Health care is different — patients don’t realize that they are also purchasing care. And, since patients don’t understand the cost of the care they are purchasing, health care prices have come unhinged from the real cost of care. However, it doesn’t have to be this way. We can turn patients into purchasers and turn healthcare into a functioning market. Providers should be posting their prices, and insurance companies should be providing their members the money needed to shop for care.
  2. Separate healthcare from employers. — Most people get their health insurance from their employer. This makes the stakes extremely high for anyone who is laid off or looking for work. If, instead, we treated insurance like we treat retirement savings, people would buy their own insurance and employers would decide how to contribute to it — similar to a 401k plan. This would ensure that losing a job or not having one doesn’t lead to a health coverage crisis.
  3. Eliminate surprises. — Let’s give everyone the information they need to make decisions when getting health care. Medical service and prescription drug prices should be transparent and available before anyone gets care. Likewise, people should know exactly what their insurance covers and doesn’t cover, so they know how much they will be responsible for.

Ok, it’s very nice to suggest changes, but what concrete steps would have to be done to actually manifest these changes? What can a) individuals, b) corporations, c) communities and d) leaders do to help?

A. Individuals.

For individuals, it’s not an easy thing to navigate. My advice would be to do the best you can to stay informed, whether that means knowing exactly what your coverage is or asking for the self-pay price whenever possible. The system as it stands does not leave a lot that individuals can do, which is why we created Sidecar Health.

B. Corporations.

Companies should demand transparency for their employees from their health insurance providers. They should also think carefully before defaulting to offering high-deductible health plans to their employees. We’re doing our best to lead by example. Sidecar Health is actively empowering people with transparency and choice. Our focus is to put individuals in the driver’s seat when it comes to their health.

C. Communities.

State and federal government agencies can mandate pricing transparency from providers and demand clearer transparency from insurance companies on coverage. People should never be surprised about what their coverage is or is not.

D. Industry leaders.

Industry leaders should support government efforts to bring pricing transparency to the healthcare system. Through transparency and consumer choice we can lower healthcare and health insurance costs for everyone.

I’m interested in the interplay between the general healthcare system and the mental health system. Right now, we have two parallel tracks, mental/behavioral health and general health. What are your thoughts about this status quo? What would you suggest to improve this?

Sidecar Health’s perspective is that everyone deserves access to the care they need, and that includes both mental and physical care. Insurance companies need to provide coverage for both. If we leave one of these out, people aren’t being cared for adequately.

How would you define an “excellent healthcare provider”?

An excellent healthcare provider is defined by its accountability to its patient’s outcomes. This is related to both the quality of the care and the cost of that care. Excellent healthcare providers ensure that their patients know how to manage and pay for their care. Surprise bills can be just as debilitating as a serious, but untreated, health condition.

Can you please give us your favorite “Life Lesson Quote”? Can you share how that was relevant to you in your life?

“We will find a way, or we will make one.”

Striving to do better in anything is hard. For my founding team and me, we can’t count the number of times we’ve been told what we are doing is impossible. Yet, we keep focusing on “how” to make things work instead of the reasons why they can’t. There are thousands of people today that are very glad we did.

Are you working on any exciting new projects now? How do you think that will help people?

Everything that we are doing is exciting: giving people incredible coverage at an affordable price and pairing that with the ability to shop for the care they need, without any physician network constraints. Our main focus right now is getting the word out so that people can get coverage if they are uncovered. Given the current pandemic, we believe this is more important than ever.

What are your favorite books, podcasts, or resources that inspire you to be a better healthcare leader? Can you explain why you like them?

The Price We Pay by Marty Makary. I really appreciate how Marty emphasizes transparency as a path to fixing health care. Most importantly, he does it with stories that everyone can relate to and with details that are shocking to see. It’s a great read.

You are a person of great influence. If you could inspire a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. 🙂

If we could inspire a movement, that movement would be delivering actionable transparency in healthcare. I truly believe in our mission: to reduce healthcare costs in the U.S. by 1 trillion dollars annually through transparency and consumer choice.

How can our readers follow you online?

You can visit our website at www.sidecarhealth.com, where our Member Care Team is available to answer any questions. You can also follow us on social:

Facebook: @sidecarhealth

Instagram: @sidecarhealth

LinkedIn: Sidecar Health

Twitter: @sidecar_health

Thank you so much for these insights! This was so inspiring!

* Sanger-Katz, Margot. “They Want It to Be Secret: How a Common Blood Test Can Cost 11 dollars or Almost 1,000 dollars.” The New York Times, April 20, 2019,
https://www.nytimes.com/2019/04/30/upshot/health-care-huge-price-discrepancies.html. Accessed November 11, 2019.

* “Lower Premiums But Higher Out-of-Pocket Costs for 2020 ACA Consumers.” eHealth, https://news.ehealthinsurance.com/insights-blog/lower-premiums-but-higher-out-of-pocket-costs-for-2020-aca-consumers. Accessed July 13, 2020.

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