I heard this over the fall, actually knew the players involved and basic details, for whatever reason one of my buddies is keyed into it. I guess Amazon has already had their own private care model in place in some areas, they're working with hospital partners that can provide full spectrum care and are going so far as to flying people to these big regional hospitals for treatment rather than stay local where their options are limited.

I don't know much beyond that, and even that was second-hand info, but I'm fascinated to see how this plays out. As others have said, the margins are thin but that doesn't mean there aren't huge inefficiencies in both how insurance is delivered and provided and how care is administered.

You need to dig deeper into the financial reports to see the inefficiency. An example, insurance costs. Malpractice insurance runs into 6 figures for each doctor. The hospital itself has astronomical insurance costs as does every program, including its pharmacy and outpatient services.

A few thoughts:

-margins are thin? I assume that's after corporate jets and executive salaries in the insurance business?

-over saturation or supply of resources drives up costs. So how many CT's, theatres, mri's, accelerarors, protonbeam etc are there?

-lack of integration in the pathway. So classics might be, rectal bleeding. Gp refers to consultant. See consultant he says u need a scope. Books u in. U then go back and see him for results. U get discharged or booked for surgery. Almost all the visits to that point are wasted without diagnostics. A gp should be able to book scopes directly. Once results are in they go straight to specialist who brings patients in. Clinical pathways work like that all over the world. Visits with out diagnostics are in many instances wasted because they either need or will order them anyway and you see the doctor at least twice and one of the visits is wasted

- building specs - hospitals are ridiculously expensive. Compare building standards for imaging between US and say Germany or France they are significantly different. Bigger it is the more expensive

-move care out closer to the patient. U don't need chemo delivered in acute settings. Patients with toxicity problems yes but otherwise?

- all babies delivered by docs?

-rebuilding operating sets as an example. Johnson and Johnson sets have historically provided parts in the operating sets to do the full range of knees. Every piece goes in to hospital. Is sterilized. Packed. Taken to theatre. Of the (I am dated now) large number of parts in the kits a small number are used. The reason being when u know the size of the patients and it's a 110lb 75 year old female you don't need the same parts as for a 300lb male. But all the work involved in lifting. Shipping. Washing. Sterlising. Packing etc 85% of it is wasted.

-corporate genetic screening offers massive opportunities to reduce complications around diabetes

There are hundreds if not thousands of changes that can be made. The US spends a disproportionately high percentage of GDP for little to know improvement on other western systems. That's not to say that the best care in the world does not exist in the US. It does. Unquestionably. But whilst exceptional care is available much is just expensive and not evidently better when looking at outcomes

Malpractice insurance really isn't an inefficiency, it's a sunk cost.

Think about what it would cost for someone to go to medical school and then open a small town family practice.
Licencing
Malpractice insurance
Coding/Billing/Accounting
Medical equipment (and all the regulations, licenses, that goes into making it).
I assume there are special building codes/inspections for medical facilities.
Electronic Medical Records

And lets not even bring up losing money on Medicare patients.

All you have to do is look at the players here. Buffet who is the most successful investor in the world over many, many decades. Then you have the banking/financing are with JP Morgan, and lastly the company that is putting all other companies out of business because of their complacency. The only thing going for the insurance industry is scale, and they may even be their undoing in the long run.

Once again if you eliminate them entirely, you have 35% of the entire health care dollar to work with, and that is before you even begin to look at actual treatments, diagnosis, and infrastructure. And you can bet that it is not just the employees of these 3 companies that are in play here, I'm sure they have had some discussions with other forward looking CEO's that would jump on board in a second once it is revealed that they can get better results with less money..

It may be a fate that big insurance will have no control over too, they could already be dead men walking and not even know it yet. I sure would not want amazon eying my business in regards to a total takeover. Remember this is a company willing to lose a lot of money short term(as in decades) in order to win the big picture in the future. They can do things other companies cannot or will not do, and of course they now have the richest man in the world at the helm. Once you have achieved that, next up is building a lasting legacy, replacing health care insurance would be about as big a thing as you could tackle in this country..

I believe the big elephant in the room is the pharmaceutical and medical device companies. Easy target, why can they sell drugs in other countries at less then half the price they sell in the US. Challenge is they have a lot of lobbying that might help them put up a fight.

Hospitals, tons of major inefficiencies, but a lot more red tape. Wasted tests for the .0001% chance that the patent has something, but the hospital has to do it to protect itself, nursing unions, administrative staff, etc. Not to mention medicare. Hospitals lose .30-.70 to the dollar on medicare patients.

It will truly be interesting. Getting into the medical insurance business isn't for the faint of heart. I really wonder what kind of pressure they can also push on the lives they will insure, creating healthier populations is the true key to lowering healthcare costs.

Some articles are saying this is half a business idea half a crusade for helping the 'people' the politicians fail to do. I'm not sure what to believe, always being cautious Id say the first part but the other part of me says if your a billionaire, there might be some desire for economic charity.

gates and polio

irrespective of motives, if they can deliver better healthcare for less they will disrupt and industry and the politicians who protect them

Good post, as you highlighted and others ahve said there are so many inefficiencies and they're revealed through various models and pathways around the country. Streamline the process a bit and involve more big data and collaboration and there's a lot of cost savings to be had.

To the one I highlighted here, a similar one is nursing, they deliver similar care at a much lower cost but as of now NP's aren't granted full autonomy in over half the country. It's the more populated, liberal states with lots of doctors that are holding this back, and study after study shows that nursing care produces at least the same level of outcomes as doctor care. Tens of thousands of NP's around the country would be free to open their own clinics and drive down cost of care; more patient-focused, preventative and comprehensive care than doctors typically can provide.

That's not one these guys will likely solve but it's low hanging fruit, imo, in helping to bend the cost curve down both in terms of cost of care and reducing health risks before they become chronic issues.

The big elephant in the room is us...the patient. Where in all of this is there a financial incentive to be healthy? We can throw technology at this, bid data, whatever but until patient own their part of the process we are talking marginal improvement at best.

I’ve mentioned this before but I’m surprised BMI or similar metrics haven’t been included as a surcharge for insurance yet. We’ve done it for smoking already and there’s probably equal evidence being over weight causes issues.

This..plus the real gold is eliminating players in the healthcare market. Look at one of the ones that got hammered in the market yesterday. PBMs. Here is one link in the chain ripe for elimination. Look at drug wholesalers. Why would a company like amazon need someone else between them and the drug manufacturers? Those are 2 big costs eliminated out of the drug/pharmacy market right there.