US-based health insurtech Sidecar Health has raised $125m through its Series C funding round, bringing its valuation to $1bn.

Led by Drive Capital, the round involved the participation of new investors BOND, Tiger Global and Menlo Ventures in addition to existing investors Cathay Innovation and GreatPoint Ventures.

Since its inception in 2018, Sidecar Health has raised over $175m.

The company employs a ‘cash price’ model that allows members to pay lower ‘self-pay’ or ‘cash’ prices to their healthcare providers rather than the higher rates negotiated by insurance companies.

It will utilise the new capital to further accelerate its growth by expanding its geographic presence and growing its team.

The firm also plans to invest in new insurance products using the fresh funds.

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Additionally, the financing will fund the roll out of a new Affordable Care Act offering for federal and state exchanges in 2022.

It will be followed by a product for the self-funded employer market, the company said.

Sidecar Health co-founder and CEO Patrick Quigley said: “The plans we designed give Sidecar Health members two things: the money they need to purchase care and the information to make decisions that are right for them.

“By doing so, we are turning patients into purchasers of healthcare. This latest funding accelerates us on our mission to make healthcare more affordable and accessible for all Americans.”

Sidecar, which currently operates in 16 US states, is said to provide customers lower monthly premiums and the option to see any doctor.

The company’s proprietary app and payment technology enables members to see their benefit amounts for over 170,000 medical services and prescription drugs.

BOND general partner Noah Knauf said: “Sidecar Health is the biggest idea I have seen in almost two decades of investing in healthcare.

“We are strong believers in their product which brings unprecedented value, simplicity, transparency and choice to consumers.”

Drive Capital partner Molly Bonakdarpour added: “The extraordinary level of transparency Sidecar Health brings to the marketplace has the potential to fundamentally change how millions of Americans shop for healthcare.

“We think Sidecar Health’s team of consumer, technology and healthcare veterans is well positioned to capitalise on the large healthcare insurtech opportunity.”

Last July, Sidecar Health raised $20m to support its expansion into new geographies and increase its staff headcount.