Harbor Health Secures $95.5 Million in New Funding to Expand and Enhance Primary & Specialty Care Services in Central Texas

Harbor Health, a primary and specialty clinic group whose mission is to put the consumer at the center of their own health, announced that it has secured an additional $95.5 million in funding. General Catalyst leads this additional round of funding with strong participation by Alta Partners and continued support by 8VC. Total investment to date is more than $128 million.

This additional funding will allow for continued growth in providing primary care services, broadening the scope of specialty care offerings, and developing plan designs that support care journeys co-created by consumers and their clinicians. Texas employers can use these plan designs to lower their costs while incorporating an improved, coordinated care system that results in healthier and happier employees.

Harbor Health was founded by Dr. Clay Johnston, Eric Scott (from 8VC) and Tony Miller. The idea of building Harbor was sparked by conversations Tony and Clay had as the leaders of their previous organizations (Bind/Surest and University of Texas at Austin Dell Medical Center, respectively).

“We realized in order to maximize the impact of our innovations, we needed to combine our efforts into one enterprise as a vertically integrated ‘pay-vider’ – both a payer and a provider,” explains Clay. “We have built a geographically dense care model that is organized around integrated practice units and focused on member health conditions. This new investment and our rapid growth confirm our innovative care model is working, and we’re meeting more people where they are with collaborative, team-based care.”

Harbor Health is leading the transformation of care that employers, providers and consumers alike are all seeking. The team is implementing a unique approach focused on helping consumers get healthier faster by connecting them to a dedicated health team and customized care pathways. This personalized and relationship-driven approach helps to lessen the emotional and financial burden our current healthcare system has on consumers.

Harbor believes that care models have to be paired with longitudinal coverage models that make insurance subsidies aligned to better care journeys. This process will help consumers understand that they really are co-creators of their health. “Eventually, we see a future where current care design and benefit design models become obsolete, replaced by a health-producing and health-promoting system that follows people along their life journeys,” says Miller.

This new approach and the history of success by both Johnston and Miller have attracted attention in the marketplace and from investors. “There’s a strong appetite for a fresh approach to healthcare delivery among employers that prioritizes outcomes, enhances consumer engagement, and is proactive by design,” says Chris Bischoff, Managing Director at General Catalyst. “We believe Harbor Health is providing ease of access to the largest covered population in the U.S. and bringing much-needed change as the company seeks to transform value-based care for the commercial sector. This aligns with our Health Assurance thesis. We look forward to supporting Tony, Clay, and the Harbor Health team in this new phase of growth.”

For the health system to really change, coverage designs need to map to consumer health conditions and the care journeys that will make consumers healthier. This needs to work in partnership with Austin employers. “Harbor is making meaningful change in transforming the current health system to a health production system. We are aligning a new care model to a payment model that rewards providers for reducing health care risk in populations and lowering the total cost of care to service that population. Consumers are demanding health care to be designed around their conditions and problems and to show them how they can improve behaviors and choose wisely about the costs of treatments. Harbor aims to do all of this in a vertically integrated solution,” states Tony Miller.

The funding news comes on the heels of several significant milestones for Harbor Health, including:

• Quadrupled the number of locations in 2023 – from two locations to now eight locations in Central Texas – with more planned in 2024
• Launched two mobile health units to serve the needs of local employers by bringing health care to local campuses
• Expanded to 43 clinicians currently working to serve the Central Texas marketplace
• Launched an Express Care (walk-in appointments and after-hours care) location in Westlake with a future Express Care location to open in Round Rock this month
• Touched consumers more than 25,000 times in Austin in 2023 with in-clinic appointments, virtual appointments, mobile clinics, and other modes of communication
• Launched an ACO (Accountable Care Organization) REACH product in conjunction with CMS (Centers for Medicare and Medicaid Services)
• Secured risk contracts with BCBS of Texas across multiple product lines
• Secured other risk contracts with multiple payers and employers

This funding round also includes returning investors Health 2047 Capital Partners, Lemhi Ventures, Martin Ventures and a series of individuals.