Earlier this week, the world was shocked by the announcement that Amazon, Berkshire Hathaway, and JP Morgan are going to partner to create a new of healthcare venture. For consumers, this is welcome news, a long time coming.
Much ink has been spilled on the state of healthcare in America, so much that there’s not much worth adding here, other than to state the obvious: health care in America is bloated, overpriced, bureaucratic, and ripe for disruption.
The news that three of the largest companies in America—companies not known for healthcare—are delving into the most notoriously hated and complex industry at present is very promising. Promising, because the slow and sluggish beast that is health care has resisted almost all efforts at modernization and mechanization, at least in terms of reducing costs and making healthcare affordable. Private companies, nonprofits, and even the federal government have been working to make healthcare services better, faster, and cheaper, and none of them have succeeded. It may just be that a “supergroup” of industry titans are what it takes to finally break up the logjam.
Amazon, one of the few truly successful dot-com era companies, revolutionized commerce and logistics and has tremendous strength in the delivery of both physical and electronic products. Berkshire Hathway, a holding company (and the third largest publicly-held company in the world) is of course known for technology, airlines, railroads, insurance, and much more). JP Morgan is the largest bank in the USA. When you put together all three players, this is quite a dream team.
One can only hope that these behemoths of industry, with their considerable infrastructure and purchasing power, can disrupt healthcare—an industry long overdue for innovation, but has been insulated from change by bureaucracy, a lack of transparency, virtual monopolies, and legislation preventing modernization.
The announcement by CEOs Jeff Bezos, Warren Buffet, and Jamie Dimon is exciting for consumers who have waited for decades (or longer) for affordable health care premiums, good healthcare outcomes, and reasonable treatment costs. In fact, it’s a very testament to the weight of such an announcement that most publicly-traded health insurance companies saw a dip in their stock price immediately after the news.
Competition may be finally coming to healthcare, and that’s a healthy thing.