Three major employers, Amazon, Berkshire Hathaway and JP Morgan Chase, announced Tuesday they were partnering to create an independent company aimed at reining in health-care costs.
There were almost no details available about how the company would function or how it would disrupt and simplify the complicated fabric of American health care. But there’s no doubt that the companies, which collectively employ more than 1 million workers worldwide, have a real interest in ratcheting down their spending on health care. Health care premiums are split between employers and employees and have been growing much faster than wages.
Major health company stock prices tumbled on the news, and the announcement stirred excitement — and questions — about how the three companies could bring their clout to containing costs in the massive employer-sponsored health insurance market, which provides coverage to approximately 160 million Americans.
“The U.S. health-care system is unsustainable in terms of its costs, and the entire debate by political leaders — whether it is Democrats or Republicans — has focused on repairing and replacing Obamacare and the ideological differences,” said John Sculley, who formerly led Apple and Pepsi-Cola and is now chief marketing officer of RxAdvance, a health tech company. “To have three of the most respected CEOs in the world step up and say that their companies are going to work together to focus on the real issues, of how do you make the U.S. health-care system sustainable and a better delivery of service than what we have today… it’s very positive.”
The announcement comes amid rampant rumors and anticipation that Amazon could disrupt health care as it has in other industries, particularly in the business of selling prescription drugs.
A person at one of the companies who is familiar with the …read more