Buffett, JPMorgan Chase and Amazon Team on Healthcare Endeavor

Leigh Mccormick
February 2, 2018

The three big companies would launch an autonomous outfit initially aimed at technology solutions, with the objective to become an umbrella firm that will be "free from profit-generating incentives".

Amazon, JP Morgan and Berkshire Hathaway are joining forces to create a healthcare firm aimed at cutting costs for their U.S. employees.

Jamie Dimon, chairman and CEO of JPMorgan Chase, said employees want transparency, knowledge and control when managing their health care.

"We enter into this challenge open-eyed about the degree of difficulty", said Bezos, the reigning world's richest man, whose net worth is now close to $120 billion according to Bloomberg. However, JPMorgan Chairman and CEO Jaimie Dimon said, "our goal is to create solutions that benefit our USA employees, their families and, potentially, all Americans".

The company has said it is adding 100,000 full-time jobs in the US through mid-2018, most in warehouses, and it is adding 50,000 corporate jobs over 10 to 15 years at its planned second North American headquarters. Bezos said success would require "a beginner's mind".

An evaluation from The Commonwealth Fund published in 2017 ranked America last in "health care system performance" compared to other countries evaluated in the study-such as France, Sweden, the United Kingdom, Australia and the Netherlands. Amazon Senior VP Beth Galetti, JPMorgan Chase Managing Director Marvelle Sullivan Berchtold, and Berkshire Hathaway Investment Officer Todd Combs will work together to oversee the initial formation of the joint entity, which has not yet been named. Check out their market cap compared to the biggest US health care companies. Immediately after the announcement, insurer and pharmacy stock prices dropped, fueling the dip in the DOW by over 300 points.

Samsung Electronics Announces Huge Fourth Quarter Operating Profits
Overall, the company reported full-year revenue of KRW 239.58 trillion and full-year operating profit of KRW 53.65 trillion. The benchmark Korea Composite Stock Price Index (KOSPI) slipped 1.28 points, or 0.05 percent, to close at 2,566.46.

Health care companies - especially pharmaceutical and biotech companies - have huge profit margins, especially compared to Amazon.

The three companies have not offered many details regarding the specifics of their plan just yet.

It was not disclosed if the company would act like a traditional health insurer or be some sort of mediator between employees and insurance companies.

Health insurance is about to get a lot better for employees of three major companies in the U.S. The three companies employ a combined 1.2 million workers, and Bloomberg reports they have a combined market capitalization of $1.6 trillion. Instead of criticizing the current system, the new organization is expected to help patients and their physicians while making them more informed along with more cost-effective decisions. Insurance players like Anthem ANTM, Cigna CI, Aetna AET, and Humana HUM are all down between 2.5%-5.5%, while pharmacy giants CVS Health CVS, Walgreens Boots Alliance (WBA), and Rite Aid RAD each dipped around 5%.

Employees want an improved health care experience and what the companies learn could be expanded beyond their initial USA work forces, said JPMorgan Chase Chairman and CEO Jamie Dimon. But he cautioned against companies involving themselves in complicated businesses that are not part of their core competency.

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