The announcement that Amazon, Berkshire Hathaway, and JP Morgan intend to “disrupt” healthcare has rightly made headlines, with some commentators positively gleeful at the prospect that these successful and innovative companies will do something–anything!–to upend our nation’s sclerotic and expensive healthcare system.
The key phrase in their joint statement is that they intend to pursue ideas “free from profit making incentives or constraints.” Amazon’s deferral of profits in favor of investment and innovation has made it the behemoth it is today. It will be fascinating to see if this culture of “innovation first” meshes with the more traditionally profit-oriented Berkshire and JP Morgan.
Assuming it does, it will be doubly fascinating to see what this new effort produces to make healthcare 1) more patient-centered, 2) more effective, and 3) less costly. As Messers. Bezos, Buffet, and Dimon admit, healthcare is exceedingly complex. We aren’t talking about selling and delivering widgets any more, or figuring out how much interest to charge for a loan. We’re talking about an industry that is deeply personal and individualistic (on both the patient and physician side), highly regulated, highly political, and with deeply embedded stakeholders who will fight tooth and nail to protect the status quo (as lousy as that status quo is for consumers).
The healthcare industry has crushed many previous efforts by very bright people to improve efficiency and lower cost. Best of luck to these three gentlemen and the team they put together.
They’re going to need it.