Amazon, JPM and Berkshire Hathaway May Lead The Healthcare Revolution - but what does that mean for consumers?
Recently, JPMorgan, Berkshire Hathaway and Amazon announced a joint venture in healthcare. Healthcare, as we know, is something few people can agree on when it comes to best practices, but everyone agrees is a broken construct. As we also know, JPM, Berkshire Hathaway and Amazon are among the most influential companies in the world: JP Morgan is the largest bank in the US, Berkshire Hathaway is one of the largest public companies in the world, and Amazon is Amazon. And though nitty-gritty details are yet unknown, through statements released by Amazon's Jeff Bezos and B-H's Warren Buffet, one can assume several top-tier goals for this venture:
1. Improve healthcare through technology. The healthcare industry is notoriously archaic and slow to adapt available technology to improve efficiencies, so this is major. And, because Amazon is involved, we're guessing a democratizing platform that includes online shopping for healthcare is in the works.
2. Simplify healthcare. Remove the layers that are a barrier to transparency. Healthcare unfortunately is also known for its complexity - this venture attempts to remove the shield that prevents us from understanding why it costs so much to see a doctor.
3. Provide its roughly 1.2 million employees with high-quality healthcare. Easy, right?
So why is this happening?
Because the healthcare industry is far too complicated. This multi-billion dollar industry lacks a focus on the end consumer - that's you and I, the people paying increasingly higher premiums for high-deductible plans. There's also a lack of efficiency in problem-solving, such as the high rate of unnecessary and costly emergency room visits, or requirements that patients visit a doctor for a refill on non-opiod prescriptions. All result in rapidly rising costs, with no end in sight.
The announcement is also somewhat expected, as healthcare is changing overall. Slowly, the future-bound wheels are starting to turn, and the industry is embracing new and disruptive ways of operating and finding efficiencies. Mobile health, virtual physician visits and sophisticated consumer expectations, along with consumer expectations of cost and data transparency and preference for on-demand services at a flat fee have fueled the birth of digital health companies who resist the status quo. As well, other various shakeups in health care have rocked its foundation, including last year's CVS acquisition of Aetna, a $69 billion-dollar deal that combines the drugstore giant with one of the biggest health insurers in the United States - a deal that certainly points to increasingly blurred lines between retail, tech, and a very traditional industry.
What's it going to take to make this new era of healthcare really happen?
A LOT of logistics and planning, not surprisingly. Due to the lack of details, we'll assume they're still in the planning phase, still figuring out how to deliver on this lofty goal. Stated Amazon's Jeff Bezos, "Success is going to require talented experts, a beginner’s mind, and a long-term orientation.”
What does this mean for you, the consumer?
TBD. But ultimately, but if all goes according to this ambitious plan and it is then reproduced for the public, end consumers could see:
A greater selection of affordable low-or no- deductible plans with low premiums
A one-stop-shopping platform offering digital health solutions for on-demand healthcare such as teleheath, virtual physician consultations, in-home examinations, best-price prescription drug marketplaces and more
An online platform to shop for insurance plans
More a la carte options and customization for individual's needs
Transparency and cross-industry consistency in billing
Negotiated pricing and doctor-patient "matching"
Sounds pretty great, doesn't it? Our fingers are crossed.