"But we also do not accept it as inevitable", Warren Buffett, Berkshire Hathaway chairman said in a statement. In the meantime, USA health insurers will be scrambling to see how they can respond to this new threat.
Billionaire investor Warren Buffett says his company is ready to invest is collective resources to check the rise in health costs.
Amazon, which mostly sold books when it was founded more than 20 years ago, has radically altered the way in which people buy diapers, toys or paper towels. "ORCRP010217-topic.html" class="local_link" >JPMorgan Chase & Co. to form a new health-care business, an attempt by three of the world's best-known companies to contain the spiraling cost of keeping their US workers healthy.
It's the latest example of how Amazon has such enormous influence and power that it can tap into a variety of industries, seemingly with a moment's notice.
Can this partnership disrupt the healthcare industry? Others suggested a more involved role.
The move sets up a major challenge to an inefficient USA healthcare system.
Later in the day, President Trump said in his State of the Union speech that reducing the price of prescription drugs would be one of his "greatest priorities", adding that the difference between U.S. prices and those in other countries was "very unfair".
Companies could also market cold and flu medicines to someone who always books doctor's appointments at the beginning of flu season, he said, or recommend obstetricians to a shopper who recently ordered pregnancy tests or prenatal vitamins. We need to figure out how to partner with these people, not run away and not be horribly defensive in this setting.More news: Hyundai Motor to Launch All-New Santa Fe SUV Next Month
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Planning for the new company is being led by Marvelle Sullivan Berchtold, a JPMorgan managing director who was previously head of Swiss drugmaker Novartis's mergers and acquisitions strategy; Todd Combs, an investment officer at Berkshire Hathaway; and Beth Galetti, a senior vice president at Amazon. Between Accountable Care Organizations (a byproduct of the Affordable Care Act that has pushed for shared savings between providers and payors), and Clinically Integrated Networks (which are provider networks focused on providing a broad range of services outside of just a hospital), the discussion has been ongoing. "If we look down the road a few years, the obvious concern is data and privacy".
Health insurers that provide benefit management or health plans to Amazon, JPMorgan and Berkshire could be among the hardest hit. "My gut tells me that it involves direct contracting with clinically integrated networks in their communities".
US top internet retailer Amazon announced Tuesday that it is partnering with the world's two major financial companies to dive into USA health care.
"It is a bit arrogant to think three big firms are going to come in and kind of re-invent health care", said Zack Cooper, an economist at Yale School of Public Health.
After having tried everything else, companies started to move in the opposite direction, offering employees high-deductible plans that expose them more directly to health care costs, combined with tax-free Health Savings Accounts to pay out-of-pocket expenses.
Private-sector employers paid almost $665 billion in 2016 in health-related costs, up 5% from the prior year, according to CMS data.
The trio said they would bring their "scale and complementary expertise to this long-term effort" through an independent company "free from profit-making incentives and constraints".