{"id":76431,"date":"2018-03-29T15:51:00","date_gmt":"2018-03-29T19:51:00","guid":{"rendered":"https:\/\/medcitynews.com\/?p=440430"},"modified":"2024-04-02T10:05:02","modified_gmt":"2024-04-02T14:05:02","slug":"surprise-corporate-giants-taking-healthcare","status":"publish","type":"post","link":"https:\/\/medcitynews.com\/2018\/03\/surprise-corporate-giants-taking-healthcare\/","title":{"rendered":"Is it any surprise that corporate giants are taking on healthcare?"},"content":{"rendered":"

\"\"<\/p>\n

Given the state of the country\u2019s healthcare system, is it any wonder that corporate giants Amazon, Berkshire Hathaway and JP Morgan Chase have joined forces to seek a better alternative for their combined 1.2 million employees?<\/p>\n

Healthcare expenditures climbed 4.5 percent in 2016<\/a> to a whopping $3.3 trillion, or almost 18 percent of the country gross domestic product (GDP). Between 2016 and 2015, healthcare spending is projected to grow at an average rate of 5.6 percent per year, or 1.2 percent faster than the GDP. At the same time, the US pays considerably more<\/a> for healthcare than other industrialized nations, yet ranks at the bottom of the heap among 11 developed countries.<\/p>\n

The news of the Amazon\/Berkshire\/JP Morgan alliance isn\u2019t much of a shock for anyone who has felt the sting of rising healthcare costs over the last few years, whether as an employer paying for some or all of our employees\u2019 healthcare coverage, or as an individual consumer faced with increasingly large out-of-pocket medical costs. Though they have not yet revealed many specifics, I believe that the Amazon\/Berkshire\/JP Morgan joint venture could be healthcare\u2019s next big thing.<\/p>\n

Here\u2019s why.<\/p>\n

The timing is right<\/strong><\/p>\n

In 2009, Congress passed the American Recovery and Reinvestment Act (ARRA) to jumpstart the economy. Included in that legislation was the HITECH Act, which aimed to promote the wide-spread adoption and meaningful use of health information technology. By encouraging the meaningful use of EHRs, the government was also stimulating the creation of more data for analytics, including details to help evaluate clinical outcomes. The HITECH Act thus laid the groundwork for the shift from fee-for-service payment models to models that reimburse providers based on the quality of care delivered to their patient population.<\/p>\n

Despite a steady stream of new initiatives to promote the delivery of quality care, the transition to value-based payment models has been slow. Various government programs encourage the meaningful use of EHRs, but smaller providers and EHR vendors have often struggled to meet program requirements. This has spurred widespread market consolidation among EHR and HIS vendors, hospitals, and integrated delivery systems. The surviving EHR vendors have benefited from the wealth of Meaningful Use stimulus dollars, but product innovation has suffered because developers have been forced to prioritize updates that address regulatory requirements.<\/p>\n

The lack of innovation has contributed to the industry\u2019s failure to appreciatively drive down the cost curve. Frustrated employers like Amazon, Berkshire, and JP Morgan continue to struggle with rising healthcare costs, while low-employment rates have increased the competition for skilled workers who are demanding higher wages and quality benefits. Rather than wait for the government to step in with new programs that promote innovation and bend the cost curve, Amazon, Berkshire, and JP Morgan saw an opportunity to create a bit of disruption in the industry by developing their own innovative programs.<\/p>\n

The players bring unique and deep expertise<\/strong><\/p>\n

Each of the three companies bring something special to the table. Amazon has demonstrated its devotion to data and process, and the ability to instantly provide vast computing power to anyone that has an internet connection. Given their well-established nationwide delivery infrastructure and e-commerce network, Amazon has the potential to quickly disrupt the distribution of medications \u2013 which account for about 10 percent of the total healthcare spend \u2013 as well as medical supplies, durable medical equipment, and other commodity goods.<\/p>\n

Berkshire Hathaway, led by billionaire investor Warren Buffet, brings deep expertise in risk management, which could prove valuable when creating and managing delivery models that encompass outcomes-based reimbursement and risk sharing. Coupled with Amazon\u2019s established ability to create intelligent, data-driven systems that track, analyze and predict behaviors, it\u2019s easy to envision the creation of a transformational solution.<\/p>\n

J.P. Morgan Chase offers deep financial resources that could support a variety of initiatives, including self-insurance underwriting. In addition, the company\u2019s long-term outlook for investment capital is well-suited for seeing any projects through to a place of real innovation.<\/p>\n

They provide a built-in test bed for innovation<\/strong><\/p>\n

Between the companies\u2019 employees and their dependents, Amazon\/Berkshire\/JP Morgan has a perfect test bed of more than two million individuals to try out new innovations. The partners have an endless number of big or small initiatives they could evaluate internally, then commercialize if proven successful.<\/p>\n

For example, the companies could deploy a new platform for care delivery that includes sophisticated tracking tools and reporting systems to drive the delivery of cost-effective care. Or, they could leverage Amazon\u2019s Alexa to assist with care management, to remind patients to take medications or schedule a doctor\u2019s appointment or to provide information on treating minor ailments.<\/p>\n

A very realistic alternative is the deployment of a medication distribution system that uses Amazon\u2019s existing e-commerce infrastructure and same-day delivery resources to dramatically cut prescription drug costs.<\/p>\n

And, as an entity that covers two million lives, the companies have a tremendous advantage when negotiating for the cost of care. Especially in areas with large concentrations of employees, the partners could easily dictate how much they will pay for care. If they\u2019re unable to settle on acceptable pricing, the alliance will have the capital to build their own facilities and create an infrastructure that supports the delivery of cost-effective care.<\/p>\n

Regardless of how Amazon\/Berkshire\/JP Morgan partners choose to move forward, other large employers will be anxious to leverage any programs that successfully bend the cost curve. Though we have seen many other organizations attempt to disrupt healthcare in recent years \u2013 Microsoft, NantHealth, Google Health are a few that come to mind \u2013 this joint venture involves players with impressive assets and capabilities at a time that healthcare is in desperate need of innovation.<\/p>\n

Healthcare\u2019s next big thing? Time will tell but I personally hope so.<\/p>\n

Photo: manop1984, Getty Images<\/em><\/p>\n

 <\/p>\n

 <\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

Lack of innovation has contributed to the industry\u2019s failure to drive down the cost curve and regardless of how Amazon\/Berkshire\/JP Morgan moves forward, other large employers will be anxious to leverage any programs that successfully lower costs. <\/p>\n","protected":false},"author":28791,"featured_media":21867,"comment_status":"closed","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"om_disable_all_campaigns":false,"featured_image_focal_point":[],"homepage_placement":"top","homepage_placements":{"top":true,"featured":true,"sidebar":false},"homepage_alternative_layout":false,"featured_categories":[27],"hide_from_feed":false,"footnotes":""},"categories":[63,27,24],"tags":[8565,40618,11628,40545],"class_list":["post-76431","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-daily","category-medcity-influencers","category-top-story","tag-amazon","tag-berkshire-hathaway","tag-healthcare-transformation","tag-jpm"],"acf":[],"yoast_head":"\nIs it any surprise that corporate giants are taking on healthcare? - MedCity News<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/medcitynews.com\/2018\/03\/surprise-corporate-giants-taking-healthcare\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Is it any surprise that corporate giants are taking on healthcare? - MedCity News\" \/>\n<meta property=\"og:description\" content=\"Lack of innovation has contributed to the industry\u2019s failure to drive down the cost curve and regardless of how Amazon\/Berkshire\/JP Morgan moves forward, other large employers will be anxious to leverage any programs that successfully lower costs.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/medcitynews.com\/2018\/03\/surprise-corporate-giants-taking-healthcare\/\" \/>\n<meta property=\"og:site_name\" content=\"MedCity News\" \/>\n<meta property=\"article:published_time\" content=\"2018-03-29T19:51:00+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2024-04-02T14:05:02+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/medcitynews.com\/wp-content\/uploads\/sites\/7\/2018\/03\/GettyImages-873898724.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"724\" \/>\n\t<meta property=\"og:image:height\" content=\"483\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"David Lareau\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"David Lareau\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"5 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/medcitynews.com\/2018\/03\/surprise-corporate-giants-taking-healthcare\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/medcitynews.com\/2018\/03\/surprise-corporate-giants-taking-healthcare\/\"},\"author\":{\"name\":\"David Lareau\",\"@id\":\"https:\/\/medcitynews.com\/#\/schema\/person\/c4a74c782274feb8cbdaaf3b25242bad\"},\"headline\":\"Is it any surprise that corporate giants are taking on healthcare?\",\"datePublished\":\"2018-03-29T19:51:00+00:00\",\"dateModified\":\"2024-04-02T14:05:02+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/medcitynews.com\/2018\/03\/surprise-corporate-giants-taking-healthcare\/\"},\"wordCount\":976,\"image\":{\"@id\":\"https:\/\/medcitynews.com\/2018\/03\/surprise-corporate-giants-taking-healthcare\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/medcitynews.com\/wp-content\/uploads\/sites\/7\/2018\/03\/GettyImages-873898724.jpg\",\"keywords\":[\"Amazon\",\"Berkshire Hathaway\",\"healthcare transformation\",\"JPM\"],\"articleSection\":[\"Daily\",\"MedCity Influencers\",\"Top Story\"],\"inLanguage\":\"en-US\"},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/medcitynews.com\/2018\/03\/surprise-corporate-giants-taking-healthcare\/\",\"url\":\"https:\/\/medcitynews.com\/2018\/03\/surprise-corporate-giants-taking-healthcare\/\",\"name\":\"Is it any surprise that corporate giants are taking on healthcare? - MedCity News\",\"isPartOf\":{\"@id\":\"https:\/\/medcitynews.com\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/medcitynews.com\/2018\/03\/surprise-corporate-giants-taking-healthcare\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/medcitynews.com\/2018\/03\/surprise-corporate-giants-taking-healthcare\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/medcitynews.com\/wp-content\/uploads\/sites\/7\/2018\/03\/GettyImages-873898724.jpg\",\"datePublished\":\"2018-03-29T19:51:00+00:00\",\"dateModified\":\"2024-04-02T14:05:02+00:00\",\"author\":{\"@id\":\"https:\/\/medcitynews.com\/#\/schema\/person\/c4a74c782274feb8cbdaaf3b25242bad\"},\"breadcrumb\":{\"@id\":\"https:\/\/medcitynews.com\/2018\/03\/surprise-corporate-giants-taking-healthcare\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/medcitynews.com\/2018\/03\/surprise-corporate-giants-taking-healthcare\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/medcitynews.com\/2018\/03\/surprise-corporate-giants-taking-healthcare\/#primaryimage\",\"url\":\"https:\/\/medcitynews.com\/wp-content\/uploads\/sites\/7\/2018\/03\/GettyImages-873898724.jpg\",\"contentUrl\":\"https:\/\/medcitynews.com\/wp-content\/uploads\/sites\/7\/2018\/03\/GettyImages-873898724.jpg\",\"width\":724,\"height\":483},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/medcitynews.com\/2018\/03\/surprise-corporate-giants-taking-healthcare\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/medcitynews.com\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Is it any surprise that corporate giants are taking on healthcare?\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/medcitynews.com\/#website\",\"url\":\"https:\/\/medcitynews.com\/\",\"name\":\"MedCity News\",\"description\":\"Healthcare technology news, life science current events\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/medcitynews.com\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Person\",\"@id\":\"https:\/\/medcitynews.com\/#\/schema\/person\/c4a74c782274feb8cbdaaf3b25242bad\",\"name\":\"David Lareau\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/medcitynews.com\/#\/schema\/person\/image\/\",\"url\":\"https:\/\/medcitynews.com\/wp-content\/uploads\/sites\/7\/2025\/09\/Dave-smaller-96x96.jpg\",\"contentUrl\":\"https:\/\/medcitynews.com\/wp-content\/uploads\/sites\/7\/2025\/09\/Dave-smaller-96x96.jpg\",\"caption\":\"David Lareau\"},\"description\":\"David Lareau is Chief Executive Officer of Medicomp. Lareau joined Medicomp in 1995 and has responsibility for operations and product management, including customer relations and marketing. Prior to joining Medicomp, Lareau founded a company that installed management communication networks in large enterprises such as The World Bank, DuPont and Sinai Hospital in Baltimore. The Sinai Hospital project, one of the first PC-based LAN systems using email and groupware, was widely acknowledged as one of the largest and most successful implementations of this technology. Lareau\u2019s work at Sinai led to the founding of a medical billing company that led, in turn, to his partnership with Medicomp. Realizing that the healthcare industry made less use of information technology than almost any other industry, particularly in the area of clinical care, Lareau immediately saw the potential for Medicomp\u2019s powerful technologies and joined the company to help fulfill Peter Goltra\u2019s vision.\",\"url\":\"https:\/\/medcitynews.com\/author\/dlareau\/\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Is it any surprise that corporate giants are taking on healthcare? - MedCity News","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/medcitynews.com\/2018\/03\/surprise-corporate-giants-taking-healthcare\/","og_locale":"en_US","og_type":"article","og_title":"Is it any surprise that corporate giants are taking on healthcare? - MedCity News","og_description":"Lack of innovation has contributed to the industry\u2019s failure to drive down the cost curve and regardless of how Amazon\/Berkshire\/JP Morgan moves forward, other large employers will be anxious to leverage any programs that successfully lower costs.","og_url":"https:\/\/medcitynews.com\/2018\/03\/surprise-corporate-giants-taking-healthcare\/","og_site_name":"MedCity News","article_published_time":"2018-03-29T19:51:00+00:00","article_modified_time":"2024-04-02T14:05:02+00:00","og_image":[{"width":724,"height":483,"url":"https:\/\/medcitynews.com\/wp-content\/uploads\/sites\/7\/2018\/03\/GettyImages-873898724.jpg","type":"image\/jpeg"}],"author":"David Lareau","twitter_card":"summary_large_image","twitter_misc":{"Written by":"David Lareau","Est. reading time":"5 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/medcitynews.com\/2018\/03\/surprise-corporate-giants-taking-healthcare\/#article","isPartOf":{"@id":"https:\/\/medcitynews.com\/2018\/03\/surprise-corporate-giants-taking-healthcare\/"},"author":{"name":"David Lareau","@id":"https:\/\/medcitynews.com\/#\/schema\/person\/c4a74c782274feb8cbdaaf3b25242bad"},"headline":"Is it any surprise that corporate giants are taking on healthcare?","datePublished":"2018-03-29T19:51:00+00:00","dateModified":"2024-04-02T14:05:02+00:00","mainEntityOfPage":{"@id":"https:\/\/medcitynews.com\/2018\/03\/surprise-corporate-giants-taking-healthcare\/"},"wordCount":976,"image":{"@id":"https:\/\/medcitynews.com\/2018\/03\/surprise-corporate-giants-taking-healthcare\/#primaryimage"},"thumbnailUrl":"https:\/\/medcitynews.com\/wp-content\/uploads\/sites\/7\/2018\/03\/GettyImages-873898724.jpg","keywords":["Amazon","Berkshire Hathaway","healthcare transformation","JPM"],"articleSection":["Daily","MedCity Influencers","Top Story"],"inLanguage":"en-US"},{"@type":"WebPage","@id":"https:\/\/medcitynews.com\/2018\/03\/surprise-corporate-giants-taking-healthcare\/","url":"https:\/\/medcitynews.com\/2018\/03\/surprise-corporate-giants-taking-healthcare\/","name":"Is it any surprise that corporate giants are taking on healthcare? - MedCity News","isPartOf":{"@id":"https:\/\/medcitynews.com\/#website"},"primaryImageOfPage":{"@id":"https:\/\/medcitynews.com\/2018\/03\/surprise-corporate-giants-taking-healthcare\/#primaryimage"},"image":{"@id":"https:\/\/medcitynews.com\/2018\/03\/surprise-corporate-giants-taking-healthcare\/#primaryimage"},"thumbnailUrl":"https:\/\/medcitynews.com\/wp-content\/uploads\/sites\/7\/2018\/03\/GettyImages-873898724.jpg","datePublished":"2018-03-29T19:51:00+00:00","dateModified":"2024-04-02T14:05:02+00:00","author":{"@id":"https:\/\/medcitynews.com\/#\/schema\/person\/c4a74c782274feb8cbdaaf3b25242bad"},"breadcrumb":{"@id":"https:\/\/medcitynews.com\/2018\/03\/surprise-corporate-giants-taking-healthcare\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/medcitynews.com\/2018\/03\/surprise-corporate-giants-taking-healthcare\/"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/medcitynews.com\/2018\/03\/surprise-corporate-giants-taking-healthcare\/#primaryimage","url":"https:\/\/medcitynews.com\/wp-content\/uploads\/sites\/7\/2018\/03\/GettyImages-873898724.jpg","contentUrl":"https:\/\/medcitynews.com\/wp-content\/uploads\/sites\/7\/2018\/03\/GettyImages-873898724.jpg","width":724,"height":483},{"@type":"BreadcrumbList","@id":"https:\/\/medcitynews.com\/2018\/03\/surprise-corporate-giants-taking-healthcare\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/medcitynews.com\/"},{"@type":"ListItem","position":2,"name":"Is it any surprise that corporate giants are taking on healthcare?"}]},{"@type":"WebSite","@id":"https:\/\/medcitynews.com\/#website","url":"https:\/\/medcitynews.com\/","name":"MedCity News","description":"Healthcare technology news, life science current events","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/medcitynews.com\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Person","@id":"https:\/\/medcitynews.com\/#\/schema\/person\/c4a74c782274feb8cbdaaf3b25242bad","name":"David Lareau","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/medcitynews.com\/#\/schema\/person\/image\/","url":"https:\/\/medcitynews.com\/wp-content\/uploads\/sites\/7\/2025\/09\/Dave-smaller-96x96.jpg","contentUrl":"https:\/\/medcitynews.com\/wp-content\/uploads\/sites\/7\/2025\/09\/Dave-smaller-96x96.jpg","caption":"David Lareau"},"description":"David Lareau is Chief Executive Officer of Medicomp. Lareau joined Medicomp in 1995 and has responsibility for operations and product management, including customer relations and marketing. Prior to joining Medicomp, Lareau founded a company that installed management communication networks in large enterprises such as The World Bank, DuPont and Sinai Hospital in Baltimore. The Sinai Hospital project, one of the first PC-based LAN systems using email and groupware, was widely acknowledged as one of the largest and most successful implementations of this technology. Lareau\u2019s work at Sinai led to the founding of a medical billing company that led, in turn, to his partnership with Medicomp. Realizing that the healthcare industry made less use of information technology than almost any other industry, particularly in the area of clinical care, Lareau immediately saw the potential for Medicomp\u2019s powerful technologies and joined the company to help fulfill Peter Goltra\u2019s vision.","url":"https:\/\/medcitynews.com\/author\/dlareau\/"}]}},"_links":{"self":[{"href":"https:\/\/medcitynews.com\/wp-json\/wp\/v2\/posts\/76431","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/medcitynews.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/medcitynews.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/medcitynews.com\/wp-json\/wp\/v2\/users\/28791"}],"replies":[{"embeddable":true,"href":"https:\/\/medcitynews.com\/wp-json\/wp\/v2\/comments?post=76431"}],"version-history":[{"count":0,"href":"https:\/\/medcitynews.com\/wp-json\/wp\/v2\/posts\/76431\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/medcitynews.com\/wp-json\/wp\/v2\/media\/21867"}],"wp:attachment":[{"href":"https:\/\/medcitynews.com\/wp-json\/wp\/v2\/media?parent=76431"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/medcitynews.com\/wp-json\/wp\/v2\/categories?post=76431"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/medcitynews.com\/wp-json\/wp\/v2\/tags?post=76431"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}