Reactions to Amazon, JP Morgan and Berkshire Announcement

Call me naïve but when I read about this trilogy’s announcement of going into healthcare I thought it was nothing more than a pooling of risk wider than any one company could enjoy on its own.

Simply put, I thought they were making their pool wider to enjoy economies to lower their cost to cover employees. I didn’t think Supply Chain was on their radar as an opportunity to find these cost savings. But people wiser than I are suggesting Supply Chain is right in the group’s cross hairs.

A quote from the Wall Street Journal on February 5, 2018 titled: JPMorgan to Banking Clients: Joint Health-Care Venture Is No Threat
JPMorgan reassured banking clients by likening its venture with Amazon.com and Berkshire Hathaway to a group purchasing organization for employees.

“The bankers reiterated Mr. Dimon’s message to clients. They explained that the initiative is akin to a group-purchasing organization, a type of setup used by hospitals to buy supplies, so the companies can get better deals for their employees….”

As a loyal reader of National Accounts Weekly, you know how much I enjoy Paul Keckley’s weekly report. His February 5, 2018 edition quotes 5 strategies the trifecta will deploy to attack healthcare. Guess which tactic is No. 3? Supply Chain.

Coincidentally, this past weekend, Keckley moderated the Vizient Leadership Summit and gave a fascinating overview of what their members think of this new initiative. Well worth 3 or 4 minutes of your time to read.

Click here for the full article.

I know it sounds simple, but this initiative and any other transformative platform will only work if the buyer (in this case the payer for healthcare coverage) wants it. It is very clear to me that AMZN, JPM and BRK want to buy healthcare for their employers differently.