Technology Focused Health Insurer Could Change Health Insurance Industry

Amazon, together with Berkshire Hathaway and JPMorgan Chase & Co., announced the companies are “partnering on ways to address healthcare for their U.S. employees, with the aim of improving employee satisfaction and reducing costs” and promptly up-ended an entire industry.

For now, the healthcare industry is shocked. Just about every large health insurer took a major hit…a full $30 billion of market value gone in a one day.

Why did it Happen?

Not only because of JPMorgan Chase’s end-of-the-sentence comment that this new enterprise may someday provide services to “potentially, all Americans,” but because these are significant players in technology, service delivery, investments, insurance and more. And because the foundation of this new non-profit company will be technology. “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,” according to the announcement. (The three companies employ approximately 1.2 million people.)

By creating a new technology-first health insurance company, these organizations are destroying the traditional health insurance paradigm by coming at the problem of affordable healthcare from a totally different perspective. Rather than having insurance (premiums, deductibles and co-pays) take the lead in building out the offering, the companies will use technology to “check the rise in health costs while concurrently enhancing patient satisfaction and outcomes,” according to Berkshire Hathaway Chairman and CEO Warren Buffett.
 
For decades, traditional health insurers have attempted to master this elusive healthcare trinity—controlling cost, improving health outcomes and increasing patient satisfaction—but none have come close to making a noteworthy breakthrough in any of the three areas. If anyone has the ability to do so, it may be this group.

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Blog Comments

Comments
Karan Shetty
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3/12/2019 5:20:30 AM

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