Latest / Becker’s Payer Issues Podcast / Innovating Health Insurance: A Conversation with Patrick Quigley, CEO of Sidecar Health

Transcript

Innovating Health Insurance: A Conversation with Patrick Quigley, CEO of Sidecar Health · Becker’s Payer Issues Podcast

• 0:00
  Hello, everyone. This is Jacob Emerson with the
• 0:02
  Becker's payer issues podcast. Thrilled today to be
• 0:05
  joined by a special guest. Patrick Quigley is
• 0:08
  the CEO of Sidecar Health. Patrick, thanks so
• 0:11
  much for taking the time to join me
• 0:12
  on the podcast today. Well, thanks so much
• 0:14
  for having me.
• 0:15
  So, Patrick, before we dive into everything we
• 0:17
  wanna talk with you about and about your
• 0:19
  company, can you tell us a little bit
• 0:20
  more about yourself
• 0:22
  and your background in healthcare?
• 0:24
  Yeah. Absolutely. Well, I don't have a traditional
• 0:26
  healthcare background
• 0:27
  as you, as you may know. So I'm
• 0:29
  an engineer, a mechanical engineer,
• 0:31
  and I'm a consumer guy. All my previous
• 0:33
  companies that I've led have all been focused
• 0:34
  on empowering consumers.
• 0:36
  But more important than any of that for
• 0:38
  for health care purposes is I'm also a
• 0:40
  dad. And I think a lot of what
• 0:41
  we built at Sidecar Health has to come
• 0:43
  from my own experiences,
• 0:45
  navigating the health care system for my family.
• 0:48
  Fantastic. So what is sidecar health then, Patrick?
• 0:52
  When did you all launch and what do
• 0:54
  you offer today? Yeah. So sidecar health is
• 0:56
  a major medical health insurance carrier that is
• 0:58
  focused on large employers. We've been around,
• 1:01
  I guess now we're in our 8th year.
• 1:03
  Everything that we do is is unique. So
• 1:05
  we've had to build everything from the ground
• 1:07
  up all around this concept of empowering consumers
• 1:10
  to take control of their health care and
• 1:12
  being in control of their health care journey
• 1:13
  to get to get access.
• 1:15
  I think the biggest thing and we can
• 1:16
  talk about it, as much as we've got
• 1:19
  time. I think the biggest thing for us
• 1:21
  is that we think the the root cause
• 1:23
  to the troubles in the US health care
• 1:25
  system is the lack of transparency and the
• 1:27
  costs and then the lack of motivation to
• 1:29
  make good decisions. And if you can solve
• 1:31
  those two problems, you can provide better coverage,
• 1:34
  better access, and better affordability in a sustainable
• 1:37
  way, which is something we all want.
• 1:40
  Absolutely. And and just to clarify with you,
• 1:42
  Patrick,
• 1:43
  how many states is Sidecar now operating in
• 1:45
  and how many members do you have? Yeah.
• 1:47
  As a large employer, like, for our self
• 1:49
  funded options serving jumbos and other folks that
• 1:51
  are self funded, we are no borders to,
• 1:54
  to where we operate. Right? So we cover
• 1:56
  people in 44 states today. In terms of
• 1:58
  the the large clients that want to be
• 2:00
  fully insured, we sell in 3 primary states
• 2:02
  today.
• 2:03
  Companies that are domiciled in Ohio with, again,
• 2:06
  employees anywhere,
• 2:07
  Georgia
• 2:08
  and in Florida.
• 2:11
  Fantastic.
• 2:12
  Appreciate you giving us all those details.
• 2:15
  So sidecar, you mentioned your consumer driven. That's
• 2:18
  your background, Patrick. You're you're aiming to disrupt
• 2:20
  the traditional insurance market with that model.
• 2:24
  So what do you see as some of
• 2:25
  the biggest challenges in or what have you
• 2:27
  experienced as being some of the biggest challenges
• 2:29
  in terms of convincing
• 2:31
  both health care providers
• 2:32
  and consumers to embrace
• 2:35
  more transparent
• 2:36
  pricing models?
• 2:37
  Yeah. I mean, I think the biggest challenge
• 2:39
  is in more facing on the US health
• 2:41
  care system, right, is how do you go
• 2:42
  ahead and provide
• 2:43
  better coverage and better access in a world
• 2:45
  where cost continues to go up? And I
• 2:48
  think the real trouble is that, you know,
• 2:49
  the traditional legacy providers, the BUKAs,
• 2:52
  they control costs by controlling access. Right? How
• 2:55
  do you introduce prior authorization to limit? Would
• 2:58
  someone really need that care? And I think
• 2:59
  that creates
• 3:01
  a lot of friction and lack of incentives,
• 3:03
  and no one really knows what their costs
• 3:05
  are. And so it's it creates a version
• 3:08
  to engage engaging the health care system. So
• 3:10
  for us,
• 3:11
  our view of the world is let's empower
• 3:13
  consumers. Let's give them full control, full transparency,
• 3:16
  and let's create motivations for them to be
• 3:19
  engaged in the decision making. And that actually
• 3:21
  opens up better coverage and better access. So
• 3:23
  it's a different way of thinking about health
• 3:26
  care, and it really matches everything
• 3:28
  people do in their entire lives. So our
• 3:31
  biggest challenge
• 3:32
  is the entire
• 3:34
  US healthcare system has been cobbled together over
• 3:37
  decades
• 3:37
  and it's hard. And it's it's complicated.
• 3:41
  It's sometimes it feels like it's there's there's
• 3:44
  too many obstacles to getting care for your
• 3:46
  family.
• 3:47
  So our challenge is by we remove all
• 3:48
  those obstacles and we suddenly put our members
• 3:51
  in,
• 3:52
  in control of their entire healthcare journey with
• 3:54
  complete transparency.
• 3:56
  And so our challenge is actually getting people
• 3:59
  to go, it's okay
• 4:00
  to do things differently.
• 4:02
  And I think that the the best kind
• 4:04
  of analogy for us is if you think
• 4:06
  back to the first time you took an
• 4:07
  Uber ride. I remember when I when I
• 4:09
  first took mine, you know, I some random
• 4:11
  person came to my house, picked me up
• 4:12
  and took me to the airport. I got
• 4:14
  to the airport and I'm looking at my
• 4:15
  app and I have my credit card in
• 4:16
  my hand. I'm trying to figure out what
• 4:17
  to do. And I asked the guy, how
• 4:18
  do I pay you? He's like, you just
• 4:19
  get out of my car.
• 4:21
  And so that experience was very different than
• 4:24
  a taxi ride.
• 4:25
  And I think the challenge for us is
• 4:27
  we're asking people
• 4:28
  to
• 4:29
  do something they've not done ever.
• 4:32
  And so at the end of the day,
• 4:34
  our biggest challenge is getting people to feel
• 4:37
  comfortable and empowered so that they can actually
• 4:39
  start start like they did today. People don't
• 4:41
  take taxis as much. They call an Uber
• 4:43
  if they need occasional transportation. And so that's
• 4:45
  that's the challenge that we work with our
• 4:47
  HR departments and and leadership teams at the
• 4:50
  companies we work with, to manage through. Sure.
• 4:52
  Sure. Absolutely. And you said, you know, it's
• 4:54
  a hard it's a complicated
• 4:56
  health care system. It's been cobbled together
• 4:59
  over the decades.
• 5:00
  And, you you know, obviously, at the end
• 5:02
  of the of last year, of 2024, we
• 5:05
  we saw,
• 5:06
  that almost come to a head. We've seen
• 5:08
  the public frustration,
• 5:10
  online about this. We're we're seeing lawmakers talk
• 5:14
  a lot more about this spurred,
• 5:16
  of course, by the by the tragic murder
• 5:18
  of of UnitedHealthcare
• 5:19
  CEO Brian Thompson.
• 5:22
  So so what's your what's your take on
• 5:24
  this,
• 5:24
  Patrick? We we we know the public is
• 5:26
  frustrated with the health care system, with the
• 5:28
  health insurance system, with denial rates, with claims
• 5:31
  issues,
• 5:32
  with accessing health care. So with everything that
• 5:35
  your company does in terms of trying to
• 5:37
  drive more transparent models, more consumer driven models,
• 5:41
  can you give us your take on on
• 5:42
  everything we're we're and how we're seeing the
• 5:44
  country
• 5:45
  respond to an event like this?
• 5:47
  You know, first of all, it's a terrible
• 5:48
  event, and we it's great that we're having
• 5:51
  a conversation about how to improve the system,
• 5:53
  but this is not how we should have
• 5:54
  ended up here.
• 5:56
  But you're right. There is a tremendous amount
• 5:57
  of frustration that seems to be, bringing things
• 6:00
  to light to have the right conversations right
• 6:02
  now. And I think for me,
• 6:04
  just like you called out the denial rates,
• 6:06
  I think that's kind of a flashpoint.
• 6:09
  There is more public discussion right now about
• 6:11
  denial rates, I think, than there has really
• 6:12
  ever been at a public level.
• 6:14
  And I think that, again,
• 6:17
  some of the data that you see published
• 6:18
  I know I saw an interview with Oscar
• 6:20
  CEO
• 6:21
  on CNBC, where they were talking about 20
• 6:23
  30% denial rates for,
• 6:25
  you know, some of some of the blues.
• 6:27
  And and United was specifically called out given
• 6:29
  the context.
• 6:30
  And, you know, Oscar CEO was was sharing
• 6:32
  that, you know, they've got industry leading,
• 6:35
  denial rates that I think he called out
• 6:36
  12%.
• 6:38
  And I sit back and I look at
• 6:39
  that. My reaction is, why is this okay?
• 6:42
  Like, if I think about my family,
• 6:45
  I would not I would not be okay
• 6:47
  with the health insurance
• 6:49
  solution to support my kids and my wife,
• 6:53
  where
• 6:54
  industry leading view is 12%,
• 6:56
  and the largest in, you know, insurance companies
• 6:59
  are are talking about denial rates north of
• 7:01
  20.
• 7:03
  So for me, I I think that
• 7:07
  the public is ready for a change.
• 7:10
  And, you know, part of the motivation and
• 7:12
  starting sidecar health is this problem is how
• 7:14
  could I get my family access to care?
• 7:15
  And so when we think about denial rates,
• 7:18
  we think about our kind of view of
• 7:20
  the world in our North Star. And our
• 7:21
  view is that doctors should be making care
• 7:23
  decisions and insurance companies should be paying for
• 7:25
  it. And that is why, like, our denial
• 7:27
  rates are less than 1%.
• 7:30
  Right? And frankly, closer to 0 than they
• 7:32
  are to 1. And that is based on
• 7:33
  this this value proposition of creating
• 7:36
  access, making sure that doctors are driving care
• 7:38
  decisions. And so as I look at I
• 7:40
  look at the the dialogue that are happening
• 7:43
  now,
• 7:44
  I I think it's about time that we're
• 7:46
  having real dialogue around real numbers.
• 7:48
  And we start figuring out how do we
• 7:50
  facilitate a world
• 7:52
  where we have more transparency, more control, more
• 7:54
  access and better decision making, and frankly, better
• 7:57
  accountability.
• 7:58
  I I think the last thing I would
• 7:59
  say here is that,
• 8:02
  I think it was, the United CEO put
• 8:04
  out,
• 8:05
  an op ed
• 8:07
  that kinda called this out and and and
• 8:09
  expressly said
• 8:10
  that that the health system we all agree
• 8:12
  that the health system doesn't work as it
• 8:14
  should. And it it was designed
• 8:16
  and cobbled together over a long period of
• 8:18
  time.
• 8:19
  And no one I think it says something
• 8:20
  to the effect of no one would design
• 8:21
  a system like this if they were to
• 8:23
  design it from the beginning. And and I
• 8:25
  just think that that statement alone,
• 8:27
  along with the frustration is like, why why
• 8:29
  are we okay with this? Let's do something
• 8:31
  different. And we believe
• 8:32
  that what's different are health plans that are
• 8:35
  modeled on what we're doing, on what side
• 8:37
  for health can do. Yeah. Absolutely. And it's
• 8:39
  a great last point that you brought up
• 8:41
  to there, Patrick, that that UnitedHealth CEO has
• 8:44
  addressed the the public frustrations in that op
• 8:46
  ed.
• 8:47
  And just, for our listeners, u UnitedHealth also
• 8:50
  did put out a statement in December saying
• 8:52
  that the company approves and pays about 90%
• 8:55
  of medical claims upon submission. So just wanna
• 8:57
  put that out there. Yeah. But but one
• 9:00
  last thing I wanna ask you about on
• 9:01
  on this specific event, Patrick, is we've seen
• 9:04
  other insurance CEOs like doctor Sachin Jain, who
• 9:06
  leads SCAM Group, a Medicare Advantage company Mhmm.
• 9:09
  Say that the industry at large needs to
• 9:11
  have some more,
• 9:13
  inflection about this event and and even say
• 9:15
  we're sorry,
• 9:17
  to to Americans about how insurers have,
• 9:21
  you know, allegedly active or or not over
• 9:23
  the last few decades.
• 9:25
  As as the CEO of of an insurance
• 9:27
  company, what what do you what do you
• 9:28
  make of a statement like that? Well, I
• 9:30
  mean, I think it's great that they're being
• 9:31
  accountable and that they're coming forward saying we
• 9:34
  want to do better. I I personally believe
• 9:35
  that anybody that's in healthcare, whether you're on
• 9:37
  the payer side, provider side, you're in here
• 9:39
  because you're mission driven. You're trying to make
• 9:41
  a difference and that's awesome. Right? So if
• 9:44
  we all acknowledge that there's problems, we just
• 9:46
  need to solve it. Right? We need to
• 9:49
  the world is clamoring for more transparency, more
• 9:51
  control, better access. I mean, mental health parity
• 9:54
  is a great policy statement. But if you
• 9:56
  look at the actual
• 9:58
  access people have to mental health, for example,
• 10:00
  like it's not enough.
• 10:01
  Right? And the fact that,
• 10:03
  we have core parts of our system, like
• 10:06
  prior authorization,
• 10:07
  step therapy for drugs.
• 10:09
  You know, I I think there was, you
• 10:12
  know, a large employer at one point last
• 10:14
  year, excuse me, a large health insurance company
• 10:16
  at one point last year, introduced prior authorization
• 10:19
  for colonoscopies.
• 10:21
  That's very extreme in my mind. Right? In
• 10:23
  my view of,
• 10:25
  you know, I don't know how many recreational,
• 10:27
  colonoscopies,
• 10:28
  Jacob, you signed up for. But, like, people
• 10:30
  aren't right there. People aren't going and doing
• 10:32
  that unless there's a reason. And so I
• 10:35
  guess it's great that there's some accountability.
• 10:37
  It's great that that United has come out
• 10:39
  and said, hey. Our denial rate is 10%.
• 10:41
  I would just say that, like, that's not
• 10:42
  good enough for my family. And we would
• 10:44
  that it needs to be bad. Yeah. Absolutely.
• 10:46
  And it certainly does not help when we
• 10:48
  see other insurers,
• 10:50
  doing things like anesthesia
• 10:52
  policies with with Right. But we won't get
• 10:54
  into all that in the details, but it
• 10:55
  yeah. Sure. It's so much more we can
• 10:57
  talk about. But in terms of where we
• 10:59
  have seen more transparency,
• 11:01
  injected into the system, Patrick, at the end
• 11:03
  of 2024,
• 11:05
  Sidecar announced an agreement with the Ohio State
• 11:08
  University's Wexner Medical Center,
• 11:11
  for a fixed price model with upfront pricing
• 11:13
  and no prior authorization.
• 11:15
  Can you walk us through how this model
• 11:17
  is is gonna be working for patients and
• 11:20
  providers on the ground
• 11:21
  and why you believe this this this is
• 11:23
  different? This is a different model.
• 11:25
  Yeah. Absolutely. And thanks for bringing it up.
• 11:27
  I we're really excited about this partnership,
• 11:29
  with the Ohio State University. It's a fantastic
• 11:32
  model of of what we do and how
• 11:34
  we want to continue to provide to partner
• 11:36
  with, the leading medical institutions in the United
• 11:39
  States.
• 11:39
  And it's what's really interesting is that it
• 11:41
  matches what how to work with all providers,
• 11:43
  even those that don't come to us proactively
• 11:45
  and say, how do we how do we
• 11:47
  integrate more into your model to get access
• 11:49
  to more to your commercial members? And so
• 11:51
  with with this, relationship is all about, just
• 11:53
  like you called out for Ohio State, this
• 11:55
  eliminates all prior authorization. There's no,
• 11:59
  there's no paperwork that,
• 12:01
  to to get, you know, psych our health
• 12:04
  members in for whatever procedures,
• 12:07
  or treatments that Ohio State doctors want. Right?
• 12:10
  So this that's key. So doctors can focus
• 12:12
  on care.
• 12:14
  We also, eliminate revenue cycle, limits. Right? Like,
• 12:17
  so our members will pay, you know, Ohio
• 12:20
  State in the way they wanna be paid.
• 12:22
  There's there's no collections
• 12:24
  issues. A lot of times, you know, hospital
• 12:26
  systems are chasing folks around for,
• 12:29
  for payment,
• 12:30
  with a traditional model with us. Like and
• 12:32
  what's special about this OSU,
• 12:35
  partnership is you you talked about a transparent
• 12:38
  pricing. Right? So
• 12:39
  OSU basically has chosen the prices they wanna
• 12:42
  charge sidecar health members.
• 12:43
  We make those prices available
• 12:45
  completely transparently
• 12:47
  to our members, and then our members choose
• 12:49
  to go to OSU knowing those prices.
• 12:52
  And so it's it's exactly how health insurance
• 12:55
  or health care should work. Right? We should
• 12:57
  be consumers of health care engaging with providers.
• 13:00
  So in that way and so, like, providers
• 13:02
  shouldn't worry about getting paid. Providers shouldn't be
• 13:04
  asking some third party that doesn't know what's
• 13:06
  going on with the care of an individual
• 13:07
  for permission. And so this is a codification
• 13:10
  of our overall model.
• 13:11
  And what it gives to our members is
• 13:13
  it gives a, you know, a a
• 13:15
  a simple access to one of the the
• 13:18
  the greatest
• 13:19
  hospital systems in the US,
• 13:21
  right through our app or knowing knowing what
• 13:23
  pricing are, and it can go and kinda
• 13:25
  engage directly with OSU. So we're thrilled about
• 13:27
  that. There's been several of these, type of
• 13:30
  hospital arrangements
• 13:31
  we have announced where the hospitals are coming
• 13:34
  to us
• 13:35
  and and asking to effectively make their pricing
• 13:38
  and make their availability available to our commercial
• 13:40
  members so that our members select them.
• 13:42
  And I think the last kind of note
• 13:44
  here is is specifically with regards to OSU.
• 13:46
  What's exciting here is you can kind of
• 13:48
  juxtapose this announcement
• 13:50
  with some of the very public kind of
• 13:52
  back and forth that OSU had been going
• 13:53
  through with Anthem, where those relationships seem like
• 13:56
  at least in the what what you can
• 13:58
  read about. Like, they seem a little bit
• 13:59
  more,
• 14:00
  kinda adversarial,
• 14:02
  like a game of chicken. Whereas what ours
• 14:03
  are is like we go and we say,
• 14:05
  hey, what what do you wanna charge our
• 14:06
  members? Let's just tell them, and then our
• 14:08
  members will come to you knowing what the
• 14:09
  prices are.
• 14:10
  Wow. That's really cool stuff. And it's fascinating
• 14:13
  to hear how the how the hospitals are
• 14:14
  coming to you versus what, at least from
• 14:17
  our perspective, what we're seeing constantly is what
• 14:19
  what you said, Patrick. He's a very adversarial
• 14:22
  relationships that the patients always end up getting
• 14:24
  caught in the middle of. But before we
• 14:26
  go, Patrick, what else are we missing? You
• 14:28
  you've got the ears of a lot of
• 14:29
  health plan leaders from all over the country,
• 14:31
  including Buka leaders.
• 14:33
  What do you wanna say? Well, what I
• 14:35
  would say is that, like, I think there's
• 14:37
  a lot of conversation about driving consumer driven
• 14:39
  health care. There's a lot of conversations about
• 14:41
  transparency,
• 14:41
  and there's there's a lot of kind of
• 14:43
  undercurrents about are we ready as a country
• 14:45
  for this? And what I would encourage everyone
• 14:47
  to think about is that consumers
• 14:49
  are the most efficient
• 14:51
  way to get to the best quality, best
• 14:54
  price in any market. And it can work
• 14:56
  the same in health care. And I think
• 14:58
  that if you're if you're a hospital system
• 15:00
  that is is nervous about transparency,
• 15:02
  I think it creates an opportunity
• 15:04
  for you to demonstrate your value that you're
• 15:07
  delivering to your patients. And patients, I can
• 15:09
  tell you from our data, will run to
• 15:10
  you when you're transparent. And you're you can
• 15:10
  you can go ahead and create a better
• 15:10
  experience for
• 15:14
  transparent, and you're you can you can go
• 15:15
  ahead and create a better experience for your
• 15:16
  doctors and better, results from your for from
• 15:18
  your patients. At the same time, payers
• 15:21
  payers actually if we could all embrace this
• 15:24
  model of letting,
• 15:26
  consumers know
• 15:27
  what things cost, what their individual responsibilities are
• 15:30
  and let them make choices, you can actually
• 15:33
  remove
• 15:34
  the restrictions to care that that are the
• 15:36
  traditional model, the prior authorization, step therapies, formularies.
• 15:40
  Economically, those do not deliver as much value
• 15:42
  as just telling someone here is a budget
• 15:45
  you have for care, spend it where you
• 15:46
  want. And so I I I hope that
• 15:49
  we can help empower
• 15:51
  payers as well as providers to embrace a
• 15:53
  model like ours because I think every health
• 15:55
  plan in the future should be similar to
• 15:57
  sidecar health.
• 15:58
  Fantastic. Lots of exciting stuff on the horizon.
• 16:01
  Patrick, thank you so much for taking the
• 16:03
  time to sit down with us and for
• 16:05
  sharing your insights with our listeners. We really
• 16:07
  appreciate it. Jacob, thanks for having me. If
• 16:10
  you'd like to listen to more podcasts from
• 16:11
  Becker's Healthcare, you can visit beckershospitalreview.com.