Considering The Bezos-Buffet-Dimon Healthcare Initiative

Racepoint Global

Written by: Peter Prodromou – President and CEO

According to recent Gallup polls, nearly half of all Americans hold a negative view of the healthcare industry, with concerns around cost and access, and the growing prescription drug abuse problem coloring their opinions.

So what does it mean now that three of America’s wealthiest, most influential business leaders are now looking to reimagine how healthcare is delivered to their employees and their families?

According to news reports, Amazon’s Jeff Bezos, Berkshire Hathaway’s Warren Buffett and JPMorgan Chase’s Jamie Dimon will form an independent healthcare company “free from profit-making incentives and constraints.”

While details have yet to be proclaimed, this announcement prompts some questions which, as they’re answered over the coming months and years, may help us better understand the shape of the health care debate in the United States, as well as the role that mega-corporations – like Amazon – will play in our civic life.

  • This new venture differs from traditional health insurance as it’s aimed solely at the employees of these three companies, along with their families. The US is relatively unique in its history of tying healthcare coverage with employment and this move would seemingly strengthen that bond. How would this new scheme change the relationship between employer and employee? Does this hinder the ability for workers to go out on their own as entrepreneurs and take risks that might limit their healthcare coverage?
  • What would the responsibility of these companies be to temporary contract workers, like those which Amazon relies on at many of its distribution centers and who currently do not receive full health coverage from the company?
  • Americans have long been wary of centralized or socialized healthcare schemes – though that opinion may be shifting according to recent polls. Traditionally, concerns about rising costs or limited access might be a place where the government would step in, instead of private industry. Will ventures like this one be able to be more efficient and less bureaucratic than a single-payer solution while also keeping costs down?
  • While Bezos, Buffett, and Dimon launched this initiative with the promise that whatever program they create will be free from a profit motive, the driving force behind this move would seem to be to reduce healthcare costs for the employer, create a benefit for current employees, and create a recruitment tool for prospective talent. Is it possible then to be completely divorced from concerns around costs and profitability?
  • If this becomes a trend, how will traditional health insurance providers and others in the healthcare system respond? Most companies are not in the position to create their own alternative systems, but does this drive traditional insurers to be more innovative and even transition business models towards more boutique or bespoke services for employers looking to compete with companies like Amazon?

Perhaps this marks the beginning of a needed disruption that changes how we address health care challenges, or it offers a refined private-sector-driven alternative to a Medicare for All system. Or, it could die on the vine – an interesting, but an ultimately unsustainable idea. How and even if this venture will work is not a question we can yet answer – but in the interim, we will continue to explore and interrogate these and other questions, and we welcome your thoughts and insights.