Amazon.com Inc, Berkshire Hathaway Inc and JPMorgan Chase & Co said on Tuesday they will form a company to cut health costs for hundreds of thousands of their employees, setting up a major challenge to an inefficient U.S. healthcare system.
The move by three of the best-known U.S. business leaders – Amazon’s Jeff Bezos, Berkshire’s Warren Buffett and JPMorgan’s Jamie Dimon, would take on the world’s most expensive healthcare system, whose mounting costs have hurt corporate profit. Shares of U.S. healthcare companies fell across the board.
The new, not-for-profit venture will initially focus on technology for “simplified, high-quality and transparent healthcare” for their more than 500,000 U.S. employees, the companies said. They did not elaborate on their strategy, but said they are searching for a chief executive officer.
Healthcare industry experts say the new entity could eventually negotiate directly with drugmakers, doctors and hospitals and use their vast databases to get a better handle on the costs of those services.
That could undercut the industry’s “middlemen,” from health insurers to pharmacies and benefits managers.
“The ballooning costs of healthcare act as a hungry tapeworm on the American economy,” said Berkshire Hathaway Chairman and CEO Buffett. “Our group does not come to this problem with answers. But we also do not accept it as inevitable.”
This is an amazing venture to an issue that truly does need help. How do you feel about this business venture between the three companies?
