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May 15, 2017 01:00 AM

UnitedHealth pulls plug on plan testing no-charge primary care

Harris Meyer
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    UnitedHealth Group is shutting down its health plan experiment featuring staff providers offering unlimited primary and behavioral care at no charge.

    Harken Health, a UnitedHealth subsidiary, reportedly is closing in Chicago and Atlanta after launching at the beginning of 2016. It will continue to cover and provide care for individual-market enrollees through the end of 2017, and will serve employer group members through the end of its contracts.

    Harken had about 26,000 enrollees in Illinois at the end of 2016, when it stopped offering plans on the Affordable Care Act exchanges and continued selling only off-exchange products. It also reversed course last year and announced it would not open primary-care clinics and sell exchange plans in Miami and Fort Lauderdale in 2017.

    Harken was widely viewed as a test of what its founder called relationship-based primary care, responding to the need for value-based benefit designs that encourage people to receive recommended primary and preventive care.

    Besides having no cost-sharing for primary and behavioral care, Harken has no coinsurance payments and charges copayments only for prescription drugs. Beyond primary care, members have access to UnitedHealth's wide national network of hospitals and specialists. The clinics are staffed by Harken-employed primary-care physicians, nurse practitioners, behavioral health specialists and health coaches, who work in teams. The centers offer complimentary yoga, dietary and other classes.

    "We think giving people unfettered access to relationship-based primary care will provide better counsel and advice and get members to use the broader healthcare system more judiciously," founding CEO Thomas Vanderheyden, who was replaced in September, said in a November 2015 interview.

    But some observers had questioned from the start whether Harken, with its no-charge primary care, lack of coinsurance and competitive premiums, could make money. "We'll see how it works claims-wise," Vanderheyden said. "It's reasonably proven that if you overinvest in primary care, you have lower downstream cost in the system."

    Dr. Mark Fendrick, director of the University of Michigan's Center for Value-Based Insurance Design, said in an interview last September that Harken's benefit structure wasn't well-designed. A better benefit design, he said, would be to focus richer preventive benefits on members with chronic health conditions while reducing coverage for low-value services such as annual physicals for younger and healthier members.

    In Atlanta, there were complaints that Harken didn't do a good job marketing to agents and brokers and that it had a hard time competing against Kaiser Permanente, a long-established staff-model HMO.

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