Sidecar Health is a startup, positioning itself as a health insurance disruptor. It offers fixed indemnity plans, which pay a set rate for each type of health service such as a doctor's visit, X-ray or surgery. Sidecar stands out for its technology, including providing members with a cost transparency tool and a debit card that's linked to its claims department. However, solely purchasing an indemnity insurance plan means you're unprotected from major medical bills because there's no out-of-pocket maximum.
What is Sidecar Health insurance?
Sidecar Health is a fixed indemnity plan, which means that it pays a specified amount for each type of health care service or treatment. You're responsible for paying the remaining balance of the medical costs.
Each of the covered services is listed in the policy, alongside how much it will pay. The plan always pays the same amount for a service, no matter how much the provider charges for your health care. This means you can get the best deal on your health care by doing research and price comparisons when choosing your doctors and medical providers.
For example, Sidecar could pay $41 for a standard hand X-ray. If the bill from the radiologist is $75, you would pay the $34 balance. If you went to a radiologist that charged $150, Sidecar would still pay $41, and you would pay $109.
It's important to note that a fixed indemnity plan is not the same as a traditional insurance plan, and these policies are exempt from most federal health insurance regulations. Because of this, you'll need to prequalify before getting covered, and the company is able to decline coverage for those who have preexisting conditions or a high-risk profile. For example, Sidecar isn't available to those over age 65. Instead, we recommend seniors opt for a Medicare plan.
However, as a tech-focused startup, Sidecar offers new cost-savings strategies to consumers. These innovative tools aren't typically available from other health insurance companies or fixed indemnity providers.
How Sidecar is using technology to improve the cost of health care
- Cash pricing: Many doctors and health care providers offer a discounted rate to anyone who will pay cash at the time of service. Sidecar members can access these cash discounts because each member gets a debit card to pay their doctor's bills at the time of care.
- Pricing transparency: The Sidecar platform estimates the average cash price for each type of service alongside how much a policy will pay, helping you calculate your expected costs. It also shows real-time pricing information about what local doctors and facilities are charging for treatments. This can help you shop around for the best prices when choosing your providers.
How Sidecar compares to a traditional insurance plan
When considering Sidecar Health, a key factor is that it's not a traditional insurance company. It doesn't give you any of the safeguards of typical insurance such as having an out-of-pocket maximum protecting you from a worst-case scenario of extreme medical bills.
Even if you're young, healthy and don't expect to need much medical care, an unexpected accident could lead to major medical bills, and having only an indemnity plan is a financial risk that can leave you vulnerable to uncapped costs.
There are two key terms to pay attention to when comparing policies:
Sidecar has a cap on how much it will pay for care in a policy year. This protects the insurance company because even if you need expensive medical care, the insurer is limited in the total amount it will have to pay. With Sidecar, you can set this at anywhere from $10,000 per year to $2 million per year.
Your expenses are not capped. For example, in a situation where you need significant care totaling $100,000, the insurer could cover 75% of the cost, and you could owe $25,000.
(traditional health insurance)
An out-of-pocket max is the maximum amount that you'll pay for covered services each year. This protects you because if you need major medical care, you'll only have to pay a limited amount.
The federal government sets the highest permissible out-of-pocket max for marketplace plans, and it's $8,550 for individual plans in 2021. This means that even if your medical bills total $100,000, you'll only pay $8,550 if that is your plan's out-of-pocket maximum.
Sidecar is a a good choice for those who need short-term insurance coverage. You can sign up at any time and cancel at any time. Like other short-term health insurance plans, Sidecar can give you coverage while you're waiting for open enrollment or when your employer's insurance coverage hasn't begun.
Sidecar may also be good for young adults who are healthy and comfortable with risk. You won't have the traditional financial protections of an out-of-pocket maximum, and a health situation such as needing surgery could leave you with major medical bills. However, the low monthly rates combined with no deductibles can make it an affordable way to manage day-to-day medical costs.
For low-income earners who qualify for a subsidy, it's usually cheaper to sign up for insurance on the health insurance marketplace than through Sidecar. The Affordable Care Act (ACA) subsidy will discount the cost of your insurance based on your income, and you may find plans for as little as $50 to $100 per month.
Those who qualify for a subsidy may consider using Sidecar to double up on coverage. A no-deductible plan through Sidecar can make routine medical care more affordable because the benefits begin right away. Plus, the high-deductible insurance plans through the marketplace give you financial protection against major medical costs. In these cases, check to see if it's a better deal to combine the two plans or upgrade to one marketplace plan with a lower deductible.
If you earn too much to qualify for health insurance subsidies, the cheapest health insurance plans will still be more expensive than Sidecar. In this situation, weigh the benefits of traditional insurance (such as the protection against major medical costs) against the benefits of Sidecar (such as making day-to-day care more affordable).
Notably, Sidecar expects to release an ACA-compliant policy option in Ohio during the 2022 open enrollment period this fall. This option will likely offer key protections of traditional ACA plans such as an out-of-pocket maximum, free preventive care, and health coverage for those with preexisting conditions.
How Sidecar works
The process of using Sidecar is a little different than you may be used to. Here's how it works.
- Request the cash rate for services: When you use Sidecar, you'll ask for the discounted cash rate when making your appointment. This can slash your bill before you ever see a doctor. The discount amount varies widely by provider and service, ranging from a 30% discount to as much as 90% off.
- Pay with your Sidecar debit card: All members get a Sidecar Health payment card that's linked directly to Sidecar's claims department. You'll use this card to pay when you go to the doctor or after receiving any type of health care.
- Submit an itemized receipt: You'll need to request a detailed receipt from the medical provider with both the procedure codes and diagnosis codes for each service you received. Upload this document to Sidecar so it can process your claim.
- Sidecar pays a fixed rate: The claims department will use your submitted receipt and your policy's list of rates to calculate the benefit amount of how much it will pay for each claim.
- You pay Sidecar for the balance: You're responsible for paying the portion of the bill that isn't covered by Sidecar. Typically, the credit card or bank account that you have on file with Sidecar is used to pay your balance.
Keep in mind, if you are doubling up on policies, you'll probably only be able to use one at a time. For example, when you use a traditional insurance plan, you won't have access to the discounted cash rate because the provider will be billing your insurance company. Conversely, any amount you pay when using Sidecar probably won't count toward the deductible of your other policy.
It can also take a little more work to manage your plan and coverage because you'll have to shop around to find the best-priced medical care and be proactive about filing the paperwork.
Where are Sidecar plans available?
Sidecar has been expanding the number of states it serves and is available in 16 states, mostly throughout the southern part of the country.
States where Sidecar Health plans are available:
Plan options, costs and features
Sidecar Health offers coverage for 170,000 medical procedures and services, providing financial support for a wide range of health care needs. These treatments are available from any doctor or facility because there is no in-network or out-of-network list of providers.
Sidecar also has no open enrollment or contracts. You can sign up and cancel whenever you want, which is an important feature for freelancers and the self-employed, who may need scheduling flexibility.
There are three standard plans to choose from, and they all have a zero deductible.
Sidecar Health prices
Maximum benefit per year
You can also customize your plan by selecting the deductible amount, coverage level and whether you want prescription drug coverage. Maternity coverage is not available in Arizona, Maryland, Mississippi, South Carolina and Utah, but in other states, it's available at extra cost. This plan flexibility can help you get a price quote that works for your budget and health care needs. There's also the option to add a three-year rate lock on your plan for an additional cost.
Because the preconfigured plans have zero deductible, the coverage can feel straightforward, and day-to-day medical care can be more affordable without having large, upfront costs.
When comparing the cost of Sidecar to other health insurance plans available through Healthcare.gov or your state marketplace, keep in mind that those with low or moderate incomes can qualify for a reduced rate on marketplace insurance plans. Your actual cost for these plans is determined by your income, and in the table below, you'll see that for some people, a Bronze or Silver plan purchased through the marketplace may be cheaper than Sidecar.
Low-income earners will usually pay less for insurance through the marketplace
Sidecar Standard plan
|Average monthly cost for those who earn $30,000||$30||$148||$215|
|Average monthly cost for those who earn $45,000||$214||$337|
|Full price for the monthly premium||$337||$472|
Silver and Bronze plans use the average monthly premium for a 30-year-old male in Charlotte, N.C.
Customer reviews and complaints
Sidecar Health members frequently comment about their positive experiences dealing with customer service. On Trustpilot, agents are described as friendly, helpful and caring. That's a strong advantage compared to the frustrations that many people deal with when calling health insurance companies.
In contrast, members have expressed frustration with the Sidecar app. The Android app is only rated at 3.8 stars on Google Play, and there's no iOS app available at the time of this writing. Even when users say they love Sidecar's health benefits, they comment about how glitchy the app is and recommend that it's easier to use the website than the app.
The Better Business Bureau (BBB) has given Sidecar Health an A+ ranking with zero complaints or reviews on the platform. Sidecar's underwriters are also top-ranked.
Sirius America Insurance Co., which underwrites policies in Arkansas, Kentucky, Mississippi, Ohio and Utah, is financially strong with an A- ranking from AM Best. It also gets very few complaints, scoring a 0.16 from the National Association of Insurance Commissioners (NAIC), far below the industry average of 1.00.
United States Fire Insurance Co., which underwrites plans in Alabama, Arizona, Florida, Georgia, Indiana, Maryland, North Carolina, Oklahoma, South Carolina, Tennessee and Texas, is also financially strong with an AM Best ranking of A. Its NAIC complaint index is a little higher at 0.47 but still far below the industry average of 1.00.
Frequently asked questions
Is Sidecar Health insurance good?
The indemnity policies from Sidecar Health are a good solution for making routine medical costs more affordable. However, a traditional health insurance plan provides benefits such as free preventive care and an out-of-pocket max to protect you from major medical costs.
How much does Sidecar Health cost?
Sidecar insurance policies typically cost between $175 and $300 per month for no-deductible plans. Flexible options let you customize your policy's health coverage to meet your budget.
Is Sidecar Health legit?
Sidecar Health is backed by underwriters with top-ranked financial stability. However, the indemnity-style insurance plan should not be mistaken as having the same type of financial protection as a traditional health insurance plan.
Does Sidecar Health have an app?
Sidecar Health only has an Android app, and an iOS app is in development. Many Android users comment that the app has bugs and that it can be easier to use the web interface rather than the app.
Methodology and sources
The above comparisons are based on health insurance premiums, plans and tax credits available on HealthCare.gov. Averages were calculated by metal tier and annual income level for a sample 30-year-old male living in Charlotte, N.C. Additional sources include Sidecar Health, the Better Business Bureau, the Google Play app store and the National Association of Insurance Commissioners (NAIC).