This isn't the first time large employers have banded together to form healthcare companies that take on the rising cost of healthcare. "The initial focus of the new company will be on technology solutions that will provide United States employees and their families with simplified, high-quality, and transparent healthcare at a reasonable cost". "Individuals and families want a simple, affordable and high-quality experience that helps them stay well", Bertolini said in a statement on Tuesday. "The three of our companies have extraordinary resources, and our goal is to create solutions that benefit our USA employees, their families and, potentially, all Americans", JPMorgan Chase chair & CEO Jamie Dimon said in a prepared statement.
That could undercut the industry's "middlemen", from health insurers to pharmacies and benefits managers. The companies say they are not approaching the problem with ready answers, but they are also not accepting the situation as inevitable.
Studies show USA health care costs as a share of the economy have doubled since the 1980s to 18% of GDP, and are far higher and growing faster than those in other major economies. The company, which mostly sold books when it was founded more than 20 years ago, has transformed how many people buy diapers, toys and paper towels. "And if there is pressure to lower that, that can flow throughout the entire system".
When Jeff Bezos, Warren Buffett and Jamie Dimon get together to make an announcement (any kind of announcement), it's sure to grab attention. Potential ways to bring down costs include providing more transparency in prices for doctor visits and lab tests, and by enabling direct purchasing of some medical items, a person familiar with the companies' plans said. And I think if they got traction with it, why wouldn't they then figure out a way to share that with other people, whether it's proprietary technology or not?
Traditional healthcare players have tried to reduce costs without losing their profit margins.
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Fanburg said revenues that the insurance companies are "sucking out of the system", paired with the increased cost of providing care, has resulted in a lot of frustration over the overall cost of health care.
Companies in the healthcare industry have been watching Amazon closely for months.
With hundreds of thousands of employees in the US, this Amazon-Berkshire-JPMorgan triumvirate would have real buying clout and the ability to command public attention, as the immediate buzz over the announcement showed. The new initiative does not have a name or CEO yet, and is being headed by three executives from each participating company.
"The ballooning costs of healthcare act as a hungry tapeworm on the American economy".
In September 2016, an investment officer for Buffett, Todd Combs, joined JPMorgan's board of directors, and began seeing Dimon regularly. Although the new company would only service the US employees of the three major businesses in its early stages, it is the first major move by Amazon into the USA healthcare market.
Amazon uses Premera Blue Cross, part of the Blue Cross Blue Shield network, according to Muken. Shares of UnitedHealth Group were down 4 percent in midafternoon trading, while Anthem's were down 5.7 percent. ExpressScripts dropped down almost 8% and Atena by 3%.
Both CVS Health Corp. Amazon closed up 1.4 percent.