Amazon plans to tackle the health care industry, partnering with Warren Buffett’s Berkshire Hathaway and JPMorgan Chase to launch a company that will help their U.S. employees find quality coverage “at a reasonable cost.”
The leaders of each company, Amazon’s Jeff Besos, Buffet and JP Morgan’s Jamie Dimon, said Tuesday they have high hopes for the project, which is in the early planning stage.
“The ballooning costs of [health care] act as a hungry tapeworm on the American economy,” Buffett said in a statement. “Our group does not come to this problem with answers. But we also do not accept it as inevitable.”
“Rather, we share the belief that putting our collective resources behind the country’s best talent can, in time, check the rise in health costs while concurrently enhancing patient satisfaction and outcomes,” the Berkshire Hathaway Chairman and CEO continued.
The company leaders said the new venture will be independent and “free from profit-making incentives and constraints.” Initially, the company will begin by focusing on technology that provides “simplified, high-quality and transparent” health care.
“The healthcare system is complex, and we enter into this challenge open-eyed about the degree of difficulty,” Bezos, Amazon founder and CEO, said. “Hard as it might be, reducing healthcare’s burden on the economy while improving outcomes for employees and their families would be worth the effort. Success is going to require talented experts, a beginner’s mind, and a long-term orientation.”
“Our goal is to create solutions that benefit our U.S. employees, their families and, potentially, all Americans,” Dimon added in the press release. It is not clear if the leaders’ ultimate goal involves expanding to offer coverage to people outside their businesses.
The move by Amazon and its collaborators comes after the growing company made some seemingly odd moves into the health care space over the last year.
The company previously put together a team to figure out how to bring down the cost of pharmaceuticals for its employees. It also hired 40 to 50 people to build strategies with the goal of disrupting the entire drug supply chain and brought on a senior doctor out of an innovative primary care group to its leadership.
Amazon’s moves did not make sense at the time, but with its new project revealed, its initiatives to shake up the multitrillion-dollar prescription drug market is a clear start to bring down the overall cost of quality health care.
While the technology giant and its coalition kept mum on the details of their new venture, the leaders said more information would be made available in the coming months.