Can the 'Netflix' model of insurance work?

A startup launched as a COVID-19 testing company is pivoting to a "Netflix" model of health insurance. 

Curative CEO Fred Turner founded the company in 2020 to provide diagnostic testing and found success producing COVID-19 tests. 

As the pandemic abated, the company pivoted to health insurance, moving its headquarters from California to Texas and laying off a number of its staff. In October, the company said it would launch a health plan, touting no copays or deductibles for its members. 

The plan currently has a few thousand members in Austin, Texas. Curative plans to expand to San Antonio in the coming months and all of Texas by the end of the year. 

Curative CEO Fred Turner sat down with Becker's to explain how Curative works and his vision for the future of health insurance. 

Investing in care upfront 

Mr. Turner describes Curative as a "Netflix" model — members pay for a "subscription" in premiums and have access to care with no cost-sharing. 

To be eligible for no deductible, Curative members have to complete a baseline visit health assessment with a Curative clinician within the first 120 days of joining the plan. 

Mr. Turner said it is often difficult to get members to engage with their insurers. 

"Usually all you're getting in terms of onboarding is a letter in the mail with a plastic card attached to it. We use that baseline [visit] to really set the scene and truly onboard people." 

Around 50 percent of Curative members have completed or scheduled the baseline visit since Jan. 1, Mr. Turner said, with hopes the number will eventually rise to 90 percent. 

Feedback on the onboarding process has been positive so far, he said. 

"People like getting the opportunity to meet with their health plan and feeling like their health plan actually cares about their outcome. Usually there's this adversarial relationship between a member and their plan. The plan is the evil one who doesn't want to cover the stuff they actually need."

Mr. Turner said Curative plans have premium costs similar to $3,000 deductible plans with other carriers. 

By investing in primary care up front, Curative hopes to keep pace with other carriers' costs by saving money on higher-acuity care down the road, Mr. Turner said. 

"The first year we're going to spend a little bit more getting these people the care they need, but doing it in a lower-acuity setting, doing it in primary care. We view dollars spent on primary care as a good thing, rather than a place to save money," he explained. "By year two and three, we expect that to pay off in decreasing more expensive, higher acuity utilization in emergency room visits, hospitalizations, specialty drug use, et cetera." 

Plans to expand 

Companies like Bright Health, Oscar Health and Clover Health have promised to shake up the health insurance industry but have struggled to turn a profit and keep plans running. 

Mr. Turner said Curative can avoid these pitfalls by staying focused on the large-group market, rather than the ACA exchange. 

"We view it as a fundamentally different market to the exchange. I don't think it's possible to make money from exchange plans. Medicare Advantage — that can be made to work, but again, that's a completely different model," he said. 

"Large group is a fully underwritten product. We have a lot more flexibility in the plan design, and you have a lot less risk of adverse selection in your business," Mr. Turner added. 

Mr. Turner said he wants to build Curative into the next large national insurance carrier. 

"I think there's two stable ways of building a plan. One is to invest in preventive care and drive better long-term outcomes," he said. "The other is to focus on 12 months at a time, and can you cut costs by avoiding the preventatives for now." 

"Both models have existed in the U.S. I think Kaiser, Geisinger, Intermountain, have demonstrated the first model really well," he continued. "Unfortunately, all of the large national carriers have picked the other version of focusing on 12 months at a time, trying to save as much money in that 12-month window. We think you can build a large national carrier that is a PPO, a commercial product for employers that actually focuses on those long-term outcomes, and that's what we're planning to build." 

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