Three of the most eminent figureheads in American business — Jamie Dimon, Jeff Bezos, and Warren Buffett — have announced their intention to form a healthcare company. Whatever this new firm looks like, its impact is all but guaranteed to be massive.
In his statement about the new venture, Buffett had some choice words for the industry as a whole. “The ballooning costs of healthcare,” he said, “act as a hungry tapeworm on the American economy.”
We couldn’t agree more. A large part of these costs come from inappropriate, ineffective, and inefficient care. We have no idea what the Amazon / JPMorgan / Berkshire healthcare company will set out to achieve — but we hope that curbing the problems of overuse, underperformance, and overcharging will be a foundational part of its mission.
Prognosis for a Tapeworm-ectomy
Really, though, that’s just a hopeful guess. Nobody knows what this new alliance might bring. The best way to suss out Buffet, Bezos, and Dimon’s intentions might be to take a look at what their companies could contribute to the cause.
It’s clear enough what JP Morgan and Berkshire bring to the table. Aside from a certain old-guard capitalist respectability, both companies have healthy revenues, and expertise in finance and insurance.
What really gets us wondering is — how will Amazon lend its weight?
Bezos has been making moves in the space for a while. Even before last week’s announcement, speculation (in some cases, you could call it ‘panic’) abounded on Amazon’s secretive ‘1492’ health-tech lab, or its plans to shake up the pharmaceutical supply chain. From time to time, the conversation could get a little overheated.
But the alliance with industry titans has underscored Bezos’s ambitions. Amazon obviously has serious plans in mind. Maybe it will leverage its logistical prowess to make healthcare transactions more seamless. Or else, it might mine its vast troves of consumer data to guide care navigation.
Or, perhaps most plausibly of all, it could re-create the success of its hyper-profitable AWS services. This would start with creating an internal solution to manage health spending on employees, and then repackaging and selling that solution to outside firms.
Whatever the case, while we understand why some healthcare experts are a little skeptical — we don’t think any healthcare leaders should take this news lightly. We certainly aren’t.
Cautious Optimism for a Healthcare Revolution
In the joint announcement for this new healthcare partnership, Buffet said something we wholeheartedly endorse: that “the country’s best talent can, in time, check the rise in health costs while concurrently enhancing patient satisfaction and outcomes.”
The tricky part is identifying who this talent might be. Toward that end, an objective measure of healthcare outcomes goes a long way. Outcomes, after all, are what distinguish talented and efficient surgeons from the tapeworms.
At MPIRICA, we see this announcement as part of a larger trend in healthcare, a movement toward empowering patient choice and strengthening employer benefits design. And while nobody can say what this new mega-company will become — we certainly won’t be rooting against it.