Your database should generate the 'user key'. Primary keys should be left to the database to generate.
1) Edit your user table, set the UserKey field to have the 'Identity specification'.
2) Modify your stored procedure. You don't need to insert into the identity field, the database will generate the id automatically.
Insert into [USER](username,password)
values(@User_Name,@PW)
SET @User_Key = SCOPE_IDENTITY()
Use SCOPE_IDENTITY() to retrieve the value of the newly created Id, returns that to your application or do whatever else you need.