Three of the world’s most influential business leaders — Jeff Bezos, Warren Buffett and Jamie Dimon — are bringing their companies together in a quest for a better approach to healthcare.
Amazon, JPMorgan Chase & Co. and Berkshire Hathaway announced this morning that they are forming an independent healthcare company focused initially on new technologies to serve their U.S. employees — an unusual and surprising partnership that will attempt to come up with solutions to one of the most complex and costly economic and societal challenges.
Plans for the unnamed company were announced this morning by Amazon CEO Bezos, Berkshire Hathaway CEO Buffett, and JPMorgan Chase CEO Dimon. The new company will initially focus on “technology solutions that will provide U.S. employees and their families with simplified, high-quality and transparent healthcare at a reasonable cost,” according to the announcement. The independent venture will be “free from profit-making incentives and constraints,” the companies say.
Bezos said in a statement, “The healthcare system is complex, and we enter into this challenge open-eyed about the degree of difficulty. Hard as it might be, reducing healthcare’s burden on the economy while improving outcomes for employees and their families would be worth the effort. Success is going to require talented experts, a beginner’s mind, and a long-term orientation.”
Dimon hinted that the venture could ultimately expand beyond employees of the three companies, saying in a statement that the goal is “to create solutions that benefit our U.S. employees, their families and, potentially, all Americans.”
Details such as the headquarters location and potential size of the new company have yet to be announced. The companies describe the new venture as “in the early planning stages.” The effort will be led initially by Todd Combs, an investment officer of Berkshire Hathaway; Marvelle Sullivan Berchtold, a JPMorgan Chase managing director; and Beth Galetti, an Amazon senior vice president. The longer-term management team and key operational details “will be communicated in due course,” the companies say.
The companies employ more than 1.1 million people globally.
Although the initiative is limited initially to their U.S. employees, the industry is reacting to the potential impact. Shares of key healthcare companies CVS, UnitedHealth, ExpressScripts and Aetna all dropped in premarket trading, CNBC reports.
Amazon has been rumored for months to be entering the healthcare technology market on its own. In October, reports surfaced that the company was looking into selling prescription drugs online. That rumor was cited among the factors motivating CVS, the largest U.S. pharmacy chain, to strike a deal to buy insurance giant Aetna for $69 billion.
Earlier this month, GeekWire unearthed an Amazon job listing seeking “an experienced HIPAA professional” who will oversee security and compliance for “a new initiative.” The job was originally listed as part of the Alexa Information group, which handles how Amazon’s voice assistant responds to user requests for information. However, after GeekWire inquired about the job posting, the Alexa categorization was removed.
Developing story, more to come. Full press release below.
Amazon, Berkshire Hathaway and JPMorgan Chase & Co. to partner on U.S. employee healthcare
Goal is to improve U.S. employee satisfaction while reducing overall costs
SEATTLE & OMAHA, Neb. & NEW YORK–(BUSINESS WIRE)–Amazon (NASDAQ: AMZN), Berkshire Hathaway (NYSE: BRK.A, BRK.B) and JPMorgan Chase & Co. (NYSE: JPM) announced today that they are partnering on ways to address healthcare for their U.S. employees, with the aim of improving employee satisfaction and reducing costs. The three companies, which bring their scale and complementary expertise to this long-term effort, will pursue this objective through an independent company that is free from profit-making incentives and constraints. The initial focus of the new company will be on technology solutions that will provide U.S. employees and their families with simplified, high-quality and transparent healthcare at a reasonable cost.
Tackling the enormous challenges of healthcare and harnessing its full benefits are among the greatest issues facing society today. By bringing together three of the world’s leading organizations into this new and innovative construct, the group hopes to draw on its combined capabilities and resources to take a fresh approach to these critical matters.
“The ballooning costs of healthcare act as a hungry tapeworm on the American economy. Our group does not come to this problem with answers. But we also do not accept it as inevitable. Rather, we share the belief that putting our collective resources behind the country’s best talent can, in time, check the rise in health costs while concurrently enhancing patient satisfaction and outcomes,” said Berkshire Hathaway Chairman and CEO, Warren Buffett.
“The healthcare system is complex, and we enter into this challenge open-eyed about the degree of difficulty,” said Jeff Bezos, Amazon founder and CEO. “Hard as it might be, reducing healthcare’s burden on the economy while improving outcomes for employees and their families would be worth the effort. Success is going to require talented experts, a beginner’s mind, and a long-term orientation.”
“Our people want transparency, knowledge and control when it comes to managing their healthcare,” said Jamie Dimon, Chairman and CEO of JPMorgan Chase. “The three of our companies have extraordinary resources, and our goal is to create solutions that benefit our U.S. employees, their families and, potentially, all Americans,” he added.
The effort announced today is in its early planning stages, with the initial formation of the company jointly spearheaded by Todd Combs, an investment officer of Berkshire Hathaway; Marvelle Sullivan Berchtold, a Managing Director of JPMorgan Chase; and Beth Galetti, a Senior Vice President at Amazon. The longer-term management team, headquarters location and key operational details will be communicated in due course.