An announcement Tuesday by three of the nation’s company titans — Amazon, Berkshire Hathaway and JPMorgan Chase & Co. — that they’re becoming a member of forces to deal with the excessive prices of worker well being care has stirred the well being coverage pot. It instantly despatched shock waves via the health sector of the stock market and reinvigorated speak about well being care know-how, worth and high quality.
Though particulars concerning the enterprise are skinny, the businesses stated in a launch that their partnership’s intent is to enhance worker satisfaction and maintain down prices by bringing “their scale and complementary expertise to this long-term effort.”
They plan to create an unbiased firm, “free from profit-making incentives and constraints,” to deal with “technology solutions.”
Berkshire Hathaway CEO Warren Buffett described well being care prices as “a hungry tapeworm on the American economy,” and Amazon founder and CEO Jeff Bezos stated the partnership was “open-eyed about the degree of difficulty” forward. Jamie Dimon, chairman and CEO of JPMorgan, stated the outcomes may gain advantage the staff of those corporations and presumably all Americans.
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But what does all of this imply and the way can it’s profitable when so many different initiatives have fallen brief? KHN requested quite a lot of well being coverage specialists their ideas on this enterprise, and what recommendation they’d provide these CEOs as they go ahead. Some of the recommendation has been edited for readability and size.
Tom Miller, resident fellow, American Enterprise Institute (Courtesy of Tom Miller)
Tom Miller, resident fellow, American Enterprise Institute:
“It’s nice that somebody theoretically with assets would attempt to construct a greater mousetrap. But it’s been troublesome to do, and a part of it’s regulatory and aggressive limitations are well-constructed within the well being care sphere, which are likely to make it much less receptive or topic to aggressive pressures.
“I welcome any new capital attempting to disrupt well being care. … The incumbents are snug and will use disruption. If Amazon has an concept, and is prepared to place some cash behind it, that’s fantastic. What they’re prepared to do apart from fly low-cost suppliers for dwelling visits in drones — I don’t know. They’d most likely must miniaturize them, wouldn’t they?”
Stan Dorn, senior fellow, Families USA (Courtesy of Stan Dorn)
Stan Dorn, senior fellow, Families USA:
“Number one, take a look at costs. America doesn’t use extra well being care than European nations, however we pay much more and that’s due to costs greater than anything. Look at hospital costs and prescription drug costs. I might additionally say, look to remove middlemen working in darkness. I’m pondering particularly of pharmacy benefit managers. Often, the availability chain is hidden and sophisticated, and each step alongside the best way the middlemen are taking their share, and it winds up costing an enormous sum of money.”
Bob Kocher, associate, Venrock (Courtesy of Bob Kocher)
Bob Kocher, associate, Venrock:
“It has been stated that well being care is difficult. One factor that isn’t difficult is that the best way to save cash is to deal with the sickest sufferers. And that’s the one factor that has confirmed to work in nice major care. I hope Amazon realizes this early and doesn’t assume that [its smart digital assistant] Alexa and apps are going to make us more healthy and save any cash.
“It would positive be good in the event that they put money into a ‘post-CPT-ICD-10-and-many-bills-per-visit’ world the place we all know costs, can simply know what is understood about high quality and expertise, and have same-day service.”
Tracy Watts, senior associate, Mercer (Courtesy of Tracy Watts)
Tracy Watts, senior associate, Mercer:
“Everyone thinks millennials wish to do all the pieces on their telephones. But that’s not essentially the case.
“[There was a recent] survey about this — particularly, millennials are probably the most focused on new well being care choices, but it surely wasn’t as a lot high-tech as it’s comfort they’re focused on — same-day appointments with a household physician, assured appointments with specialists, dwelling visits, a wider array of providers out there at retail clinics. That was sort of an ‘aha’ — this sort of comfort and high-touch expertise is what they’re in search of. And while you consider ‘health care of the future,’ that’s not what involves thoughts.”
John Rother, president and CEO, National Coalition on Health Care (Courtesy of John Rother)
John Rother, president and CEO, National Coalition on Health Care:
“Health care is complex and expensive, so the aim should always be simplicity and affordability. Three keys to success: manage chronic conditions recognizing the life context of the patient, emphasize primary care-based medical homes and aggressively negotiate prescription drug costs.”
Suzanne Delbanco, government director, Catalyst for Payment Reform (Courtesy of Suzanne Delbanco)
Suzanne Delbanco, government director, Catalyst for Payment Reform:
“The largest driver of well being care prices is costs. Those are being pushed up by well being care suppliers who’ve consolidated and can proceed to consolidate and amass extra market energy.
“It feels like they [the companies] are limiting the usage of well being plans, but when they’re going to get into that enterprise, they’re going to give you the identical challenges well being plans face. What could be actually progressive could be to construct some supplier methods from the bottom up the place they will really get a deal with on the precise prices and remove the market energy that drives the costs up, they usually can have management over their costs.”
Brian Marcotte, president and CEO, National Business Group on Health (Courtesy of Brian Marcotte)
Brian Marcotte, president and CEO, National Business Group on Health:
“They acknowledge that is [a] long-term play to get entangled on this. I’d must say, this business is ripe for disruption.
“I believe we all know know-how will proceed to play an growing function in how shoppers entry and obtain well being care. We’ve additionally realized most shoppers don’t contact the well being care supply system with sufficient frequency to ever be a complicated client. What’s intriguing about this partnership is Amazon for a lot of shoppers has develop into a part of their day-to-day world, a part of their routine. It’s intriguing to think about the probabilities of integrating well being care into client routine.
“And I believe that therein lies the chance. Employers provide a whole lot of assets to their staff to assist them maximize their expertise, and their No. 1 problem is engagement.”
Joseph Antos, well being economist, American Enterprise Institute (Courtesy of Joseph Antos)
Joseph Antos, well being economist, American Enterprise Institute:
“My first suggestion is to look at what other employers have done (some unsuccessfully) and consider how to adapt those ideas for the three companies and more broadly. Change incentives for providers. Change incentives for consumers. Work on ways to reduce the effects of market consolidation. The bottom line: Don’t keep doing what we are doing now. I don’t see that these three companies have enough presence in health markets to pull this off anytime soon, but perhaps this should be viewed as the private-sector version of the Affordable Care Act’s Innovation Center — except, this time, there may be some new ideas to test.”
Ceci Connolly, president and CEO, Alliance of Community Health Plans (Courtesy of Ceci Connolly)
Ceci Connolly, president and CEO, Alliance of Community Health Plans:
“We know that 5 percent of any population consumes 50 percent of the health care dollar. I would encourage this group to focus on how to better serve those individuals who need help managing multiple chronic conditions.”
David Lansky, CEO, Pacific Business Group on Health (Courtesy of David Lansky)
David Lansky, CEO, Pacific Business Group on Health:
“The incumbent suppliers of providers to our members are usually not doing as a lot as we’d like carried out for affordability and high quality. So, we’re happy to see them go down this path. We don’t know what piece of the puzzle they may deal with.
“We know well-intended efforts through the years haven’t added as much as materials influence on value and high quality. I might suspect they’re doing one thing broader, extra disruptive than initiatives we have now tried earlier than.
“I believe throughout the board they’ve the chance to set excessive requirements for the well being system in no matter platform they use. These corporations have a historical past of elevating the bar. Potentially, it may very well be a assist to all of us.”
Staff writers Julie Appleby, Rachel Bluth, Jenny Gold, Jay Hancock, Shefali Luthra, Jordan Rau, Julie Rovner and Chad Terhune contributed to this report.
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