Economic News
Buffet, Bezos, and Dimon Plan to Form Health Insurance Company
The debate over healthcare in America took an interesting turn this morning as executives from three major corporations announced their intentions to get into the healthcare industry. Jeff Bezos of Amazon, Warren Buffet of Berkshire Hathaway, and Jamie Dimon of JPMorgan Chase say they’re joining forces to create a better healthcare alternative for their employees. While details are sparse at this time, as Yahoo Finance reports, word of this formation alone was enough to sink some sector stocks in premarket trading.
In announcing the formation of their yet unnamed new venture, the executive trio said that the company would be “free from profit-making incentives and constraints,” with the main goal being the creation of “technology solutions that will provide U.S. employees and their families with simplified, high-quality and transparent healthcare at a reasonable cost.” Beyond that, reports suggest Amazon has been looking into pharmacy distribution, which may or may not play a role in the new company. Notably such an arrangement would somewhat mirror the recent deal between CVS and Aetna that would see the drug store chain buying the insurance provider.
“The ballooning costs of healthcare act as a hungry tapeworm on the American economy,” Buffett wrote in a statement, adding, “Our group does not come to this problem with answers. But we also do not accept it as inevitable. Rather, we share the belief that putting our collective resources behind the country’s best talent can, in time, check the rise in health costs while concurrently enhancing patient satisfaction and outcomes.” Bezos echoed those sentiments, saying, “The healthcare system is complex, and we enter into this challenge open-eyed about the degree of difficulty. Hard as it might be, reducing healthcare’s burden on the economy while improving outcomes for employees and their families would be worth the effort. Success is going to require talented experts, a beginner’s mind, and a long-term orientation.”
Perhaps what’s most interesting about this announcement is that it finds the public sector taking on the health care dilemma whereas previous discussions have focused mostly on government efforts. Of course recently proposed reforms to health care and health insurance have failed to advance at the legislative level, which may have partially led to Buffet, Bezos, and Dimon to work on their own solution. While it may be a while before this partnership bears fruit and it’s unclear if whatever the new company cooks up could be expanded beyond their workforce, this formation is certain to shake things in the healthcare field up a bit.
