New insurer in Maine’s ACA marketplace to offer hybrid health insurance

Starting this fall, Cumberland County residents will have the option of purchasing a new type of health insurance on the Affordable Care Act marketplace that blends traditional insurance and direct primary care.

Taro Health – a new insurer based in Maine – is offering a potentially first-in-the-nation insurance model that consumers will be able to purchase starting in November, with coverage beginning in 2023.

The insurer is targeting about 5,000 people who choose to pay their doctors directly and forgo traditional insurance, a model called direct primary care. Under direct primary care, patients pay out of pocket for routine doctor visits and the type of care that can be done in a doctor’s office, such as diagnosing and treating mild illnesses, some screenings, blood tests and annual physicals.

By eliminating insurance paperwork for routine care, direct primary care advocates say, doctors can focus more time on patients and pass on cost-savings from not having to process insurance claims.

But that model founders when patients need specialized care, such as for broken bones, cancer or rare diseases. If they hadn’t purchased insurance in addition to paying direct primary care fees, they would be on the hook for the cost of expensive hospital visits and specialty care. The Taro Health plan is a hybrid of conventional insurance and direct primary care. Members pay a monthly premium for traditional health insurance options and a network of 12 physicians who participate as direct primary care providers.

A COMBINING OF CONCEPTS

“There’s a combining of concepts,” Jeff Yuan, a co-founder of Taro Health, said in an interview Wednesday. “We are insurance. We are not just direct primary care.”

Yuan, of New York City, said his company chose Maine to launch the hybrid insurance model because the state has one of the highest per capita rates of direct primary care physicians in the country. Yuan said he expects Taro Health will expand to the rest of Maine and other markets in the coming years. MaineHealth’s network will be in-network for Taro Health.

Taro Health plans will be available at CoverME.gov starting on Nov. 1. Comparison shopping for the new Taro Health plan and the rest of the ACA marketplace plans were not available on the Maine Bureau of Insurance website Wednesday, but they are expected to be released soon.

Direct primary care has traditionally attracted people who want to have more time with their doctors and have the financial means to pay a monthly membership fee, the cost of routine care and a premium for a conventional health plan to cover major illnesses and injuries.

Dr. Lisa Lucas, a direct primary care doctor in Freeport, said about half of her patients have insurance, and have to pay for her care above and beyond their monthly insurance premiums. Those customers are buying conventional health insurance plans and paying for direct primary care, making it cost prohibitive for some families.

“For a lot of my patients, if they’re paying for insurance, to see me, I’m an extra cost,” Lucas said on Wednesday. “But with a Taro plan, I am no longer an extra cost. It’s included in the plan.”

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