Oscar Health Insurance is about to get a lot closer to its customers.
Today the New York health insurer, which has raised more than $150 million in venture capital, said it has partnered with wearable-device company, Misfit, in a program that will link customer biometric information straight to their health insurance.
Starting in January, Oscar clients can opt to receive a free Misfit wristband pedometer that will connect automatically to Oscar’s app. Once set up, the Oscar Misfit will pay you to walk. Each day you get a new target for the number of steps to take. Hit the goal and earn a buck—do it 20 times, and you get an Amazon $20 gift card (up to $240 a year). “We want to get people outside and to be physically active,” says Oscar co-founder Mario Schlosser. “It’s to prevent you from getting sick in the first place—get people to be physically active and push them to do more with financial rewards.”
If the program works, Oscar stands to get a big financial reward too. For health insurers, active clients are cheaper clients. Says Schlosser, “Walking more improves blood pressure, weight, and mental health.” If Oscar can convince thousands of clients to be a bit more fit, it could save millions of dollars in future health coverage costs.
Oscar--founded in 2013 by Josh Kushner (Thrive Capital), Kevin Nazemi and Mario Schlosser—is trying to bring big data, design, and transparency to the often-puzzling world of health insurance. Oscar has raised $155 million from investors who normally work with dotcoms, not doctors: Jim Breyer (Breyer Capital), Founders Fund, General Catalyst Partners, Khosla Ventures and Kushner’s own Thrive Capital. Oscar’s last round in May put its valuation around $800 million.
As health tracking goes, the Misfit step-counter is just the first step. Soon wearables will be able to your track heart-rate and blood pressure. Mix that data with algorithms and you’ll have apps that can detect your stress levels, cardiovascular health, and nutrition--all in real time. It’s a dream for doctors, and a nightmare for privacy proponents. Oscar’s new reward system now sounds good for both the insurance company and its customers. But what if, thanks to wearables, health insurance began to work like car insurance where every health infraction (say a bar bender, Thanksgiving feast or sedentary Sunday of
Schlosser shrugs off the big-brother scenario, stating that the Misfit program will always be optional and reward-based: “We will never link this to anything punitive, and it will never enter our review process,” says Schlosser. “After learning the insurance industry inside and out, I’m very comfortable with insurance companies having this data. We are so heavily regulated on what we do with information--especially compared to other health apps on your phone.”
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