The burgeoning collaboration between Amazon, JPMorgan Chase and Berkshire Hathaway seeking to transform the American health care system is long on ambition and short on details.
By their own admission, the companies are stepping up to the plate without much experience playing the game, which could easily translate into a swift strikeout.
But they’re already being taken seriously — and for good reason.
With two of the world’s three richest people leading the charge – Amazon CEO Jeff Bezos and Berkshire CEO Warren Buffett – as well as JPMorgan Chase CEO Jamie Dimon, the newly minted coalition is hoping to lower health care costs for the companies’ employees and deliver significant advancements for all patients.
The challenge is monumental. Health care spending represented 17.9% of the U.S. economy in 2016, totaling about $10,348 per person, and continues to rise, according to the U.S. Centers for Medicare & Medicaid Services.
Based on their past accomplishments, how might the alliance leaders tackle what Buffett called “a hungry tapeworm on the American economy”?
Any prediction about the alliance’s plans must glean insight from Amazon’s success, which has been based on removing entire layers of product sales and distribution and adopting new ways of thinking. That’s caused massive disruption in the retail and tech industries.
With retail, Bezos refused to travel the well-worn path established by leaders in the business. Victims that failed to adapt, such as bookstore chain Borders, are gone. Others, such as Sears, are teetering.
The lesson for health care? The system you know today won’t necessarily exist in its current form for much longer if Bezos, Buffett and Dimon get their way.
To shake up health care, “it takes bold thinking on the part of thought leaders who are willing to go out there and stake a claim that they will be able to do something grand,” said Jean Abraham, a health care administration professor at the University of Minnesota and former senior economist on health issues for the White House Council of Economic Advisers.
One sign the new alliance is building momentum is that more companies are interested in joining them.
The Health Transformation Alliance, which was formed in 2015 by American Express, Macy’s, Verizon and Caterpillar, hailed the new coalition’s formation. Since its creation, the Health Transformation Alliance has added a few dozen additional members, including JPMorgan Chase and one of Berkshire’s subsidiaries, BNSF Railway.
“We are interested in exploring ways we can work together, and I trust that we will,” says Rob Andrews, CEO of the alliance.