Austin, Texas-based Harbor Well being, a startup major and specialty clinic group, is now providing Central Texas employers a direct major care possibility, which supplies staff a full spectrum of major care providers totally free. Harbor co-founder Clay Johnston, Ph.D., M.D., M.P.H., who beforehand served because the inaugural dean of the College of Texas at Austin Dell Medical Faculty, just lately spoke with Healthcare Innovation about Harbor Well being’s bold plans for redesigning the well being system from the bottom up.
In January 2024, Harbor introduced it had obtained $95.5 million in a funding spherical led by Normal Catalyst, bringing the whole funding at the moment to greater than $128 million. The observe mentioned its final mission is to revamp the well being system in order that docs and the staff working with them actually get to know the individuals of their care.
The direct major care resolution, referred to as Core by Harbor Well being, bypasses insurance coverage firms and makes it straightforward for members to construct an ongoing relationship with their well being staff and attain their well being objectives with out worrying a couple of fee-for-service cost construction, the corporate mentioned.
Healthcare Innovation: Earlier than we speak in regards to the direct major care providing, might you describe the origins of Harbor Well being briefly for our readers who aren’t conversant in it? The place did the concept come from and the way did you set it collectively initially?
Johnston: Partially, it got here from what we had been attempting to attain on the medical faculty — to re-envision what the healthcare system ought to appear to be and construct it that approach. However we did it situation by situation in specialty areas. My realization was that we weren’t going to succeed that approach, that the incumbents within the healthcare system had been so highly effective and so strongly motivated to maintain every little thing in that the established order that with one supplier group, it simply wasn’t going to work. We could not get the steering. We could not get the contracts from carriers. We received lots of curiosity from self-insured employers, and so they purchased some stuff immediately from us. That helped us, but it surely wasn’t sufficient to create a scalable system, and that is actually what I used to be there to do.
The conclusion was that so as to make this work, we’ve got to tear the entire thing down and rebuild it, not do some reworking. That’s actually what we’re doing at Harbor, however we’re doing it in a staged approach. The very first thing that you simply want if you are going to rebuild that system is a brand new system of first-touch care to interchange major care. What does that appear to be? How do you create it in order that it actually cares for people and their well being and is motivated to maintain them more healthy and likewise to cut back waste?
The primary stage is to construct that scientific system, and you then layer on the specialty care. First off, you get a ton of data about the place good specialty care is going on. We have executed that. We’ve got a giant knowledge system, and we use machine studying to assist us to establish who’s doing issues greatest. After which over time, we have introduced in an increasing number of specialists, and we’ll proceed to try this when we’ve got hassle having access to the standard that our individuals want. You then layer on totally different cost plans. So initially, you’ve received to take no matter contracts you are given. You don’t have any market affect. We take price for service, but it surely’s not why we exist. And, actually, we lose cash on price for service, but it surely’s a bridge. After which an increasing number of you attempt to get these contracts to appear to be capitated contracts or such as you’re taking full danger on individuals, and over time, you then can layer by yourself insurance coverage merchandise. So Core is our first profit product, and we plan so as to add extra merchandise in that house over time.
HCI: Is that this direct major care mannequin changing into extra widespread elsewhere? Are you seeing examples of supplier teams working immediately with employers and bypassing the insurance coverage firms?
Johnston: Sure, there are extra of us doing this now, and coming from all totally different areas. Some firms create on-site clinics, teams like Clover. After which others are coming from stable major care teams who acknowledge that this provides them extra freedom to look after individuals the way in which they need to be cared for. After which it is coming from particular person docs as effectively, though the person docs actually aren’t essentially promoting to employers. They do not have sufficient bandwidth to try this.
HCI: What number of clinic settings does Harbor Well being have now?
Johnston: We’ve got 11 bodily clinics and two cell clinics. We transfer round.
HCI: Are you already working with some employers in Central Texas? Or do you now must line up the employers to work with?
Johnston: Now we’ve got to line up the employers to work with. We have already got a number of nibbles, so this can occur rapidly.
Some employers are providing high-deductible plans. The issue with that’s that any resistance to getting major care is only a dangerous concept. It simply means you are going to let issues fester and worsen till they change into costly. So we match properly into these high-deductible plans as a result of we make it free to get the suitable care.
HCI: In fascinated about the sorts of employers this might attraction to, I used to be picturing high-tech firms who would provide this as a perk, however possibly not. Is it additionally for employers with lower-wage staff?
Johnston: It really is each. One of many first ones that is already dedicated, is a enterprise capital agency. They need fairly easy accessibility for his or her staff. However we have additionally heard from employers just like the counties and faculty districts. That is actually engaging to them due to their staff not getting major care due to deductible points. Finally, major care must be free, proper? It’s in everyone’s greatest pursuits to make it free. It is a dumb factor that we’ve made it costly.
HCI: That is in all probability very engaging to the clinicians as a strategy to observe. However does it require a sure retraining to get out of that fee-for-service hamster wheel mindset? Is it a shift in how they work together with sufferers?
Johnston: What we’re discovering is that this turns into fairly pure to of us, as a result of it is extra in line with the way in which they suppose medication must be practiced. They did not go to med faculty to be on a hamster wheel. They went to med faculty to essentially look after individuals, and having the incentives align with that, it simply feels proper to them.
The opposite factor we have tried to do is to take among the arduous duties and have someone else deal with them. That provides us some extra flexibility. We put the prior authorizations and issues that clinicians are doing immediately onto different personnel, and we had been fairly considerate about how we do this, in order that the clinicians are actually working on the high of their recreation and doing the issues that they know are useful, and we all know are useful, and that clearly makes them happier, too. We’re not apprehensive about billing for insurance coverage on a regular basis.
HCI: Does that change how they use the EHR?
Johnston: Nice query. So immediately it doesn’t. Most of our sufferers are nonetheless price for service, the place the EHR is a core part of what they contact,. However, , what I used to be describing about fixing the healthcare system — you’ll be able to’t do it with the present EHR, proper? We’re already getting them to interface with the EHR otherwise, however in the end we’ll be the place the EHR shouldn’t be going to be related. It is actually going to be us designing a system to match the mannequin of care. That is an even bigger carry, however it’s one which we have already began to to provoke.
HCI: Is a part of your marketing strategy to scale this geographically past the place you might be in Texas?
Johnston: Sure. What we’re attempting to do is tremendous arduous. I imply, it in all probability sounds ridiculously bold, and it could be if we had been attempting to do it nationally on the similar time.
We want this native penetration for a wide range of issues. It makes lots of issues simpler. One is advertising. Folks know us now. Phrase of mouth is our major supply of promoting. One other is {our relationships} with companions resembling specialty care organizations. We’re large enough on this city that individuals care about us. They need our referrals. They’re going to companion with us in a extremely collaborative strategy to attempt to enhance their outcomes. Then we get higher contracts with present insurers as a result of we’re large enough, and we are able to meet the wants of staff throughout the metro. So for all these causes, rising and actually being good in a market is vital.
We’ll develop in Texas. However then, sure, we’ll develop past that. What we’re attempting to do is create the entire working system. Presently, every little thing works on price for service, and there is the RVU system that form of drives clinician conduct, and there are copays, coinsurance, deductibles. What we’re attempting to do is rebuild all of that stuff to vary the underlying incentive buildings and working system in order that it then can change into extra simply exportable. So we would not essentially must personal the practices for them to observe on this totally different approach. That is in the end what we’re considering will permit extra fast scaling. Our ambitions do undoubtedly transcend Texas, however we’re not going to do something in that respect till we’re fairly assured that we’ve got the mannequin proper, that it is extremely profitable right here, and that it is able to to scale.
HCI: What about different cost fashions targeted on major care that massive insurers and CMS are experimenting with? Does that match into what Harbor Well being is doing?
Johnston: It does completely. We really take part in ACO Attain, which is a wonderful program. It permits us to do all of the issues that I simply described. We additionally take part in Medicare Benefit agreements with different insurers, however they aren’t as engaging to us. They maintain on to lots of the advantages that we produce by way of enhancing outcomes. They grasp on to that monetary profit, so it is it is more durable for us to do all of the issues that we might in that system, but it surely’s nonetheless useful on this transition. We even have offers in industrial insurance coverage that permit us to share among the financial savings.