It's been a week since news broke of Amazon, Berkshire Hathaway and JP Morgan's plan to take on the health care industry with their own business collaboration. Since then, there's been no shortage of news articles and opinions on how the move will play out, from speculation on who will run the company and how it will be structured to what it means for other health care giants.
It's one thing to listen to health care and financial pundits extrapolate on a broad level about the potential to disrupt or completely revolutionize the market, but it's another to get into the gritty details of how to make it actually happen. Insurance and benefits brokers, however, know that's easier said than done–they've been working for years to find new ways to lower health care costs for their employer clients. As such, they have a unique perspective on what impact Amazon and Co. could have, and how they might succeed:
A chink in the status-quo armor
"The recent announcement between Amazon, Berkshire Hathaway, and JP Morgan has huge potential ramification to do good in our system. While there are still few details, and I see potential conflicts of interest–particularly in the Berkshire Hathaway portfolio–there is no doubt that these leaders hold the potential to create change. I think the greatest potential change could be from a change in mindset and culture and validation in this country that the status quo no longer needs to be accepted by any and all employers in all segments, geographies and industries."
—David Contorno, Lake Norman Benefits, Inc.
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Benefitting from a controlled enviroment
"I'm very interested to see the improvements that this new company can make in price transparency and delivery. I am hoping the company will also be transparent about the challenges it encounters because our health care system is so complex system.
"I think this move could have an impact on health care, but wouldn't have an immediate impact on health insurance. With an employee population as big as these combined companies have, they would likely self-insure and use their buying power to negotiate pricing with providers and suppliers. They would also have access to a lot of user data that could be managed with artificial intelligence to potentially drive better and more cost-effective decisions. But they would also be working with a captive audience of employees who would probably be given limited choices for plan design and networks — logical ways to simplify their system and contain costs. That's a very different environment than the one my employer groups are functioning in right now, and they still need my expertise to help them and their employees manage the complex landscape of carriers, plan designs, networks and regulations."
—Amy Evans, HIP, president, Colibri Insurance Services
Small-scale solutions go big
"I think the announcement is exciting and sends a very strong message to the industry in general. It is interesting that it took three industry giants to get the public to notice this incredible message, because self-funded employers have had solutions for the past three to five years that are different and that simply work to improve outcomes and reduce medical spend. Self-funded employers can reduce their spend now by 15 to 20 percent in on year and sustain it. The employees will not be bothered, or hassled, by these simple and practical solutions similar to what cost shifting does to upset employees. Kudos to these large employers for saying enough is enough and we need change."
—Jeff Bernhard, president, Continental Benefits
No profit? No problem
"I'm sure you noticed the phrase, 'free from profit-making incentives.' While many in the industry may scoff at this, recognize what it means. Using their 2.5 million members, they're willing to invest in new ideas and be a health care incubator for America. If there's money to be made, I'm sure they'll figure it out, but they don't have the short-term constraint of bringing ideas to market profitably. This is a differentiator."
—Tonia Degner, freshbenies
Follow the leaders
"The three companies involved are pioneers in their respective industries.They have incredible resources and are using their size to stand up to the health care cartel. I applaud their attention to the health care crisis and think it's only a matter of time before other companies join in the fight to restore the American Dream. I'm very interested to see their successes." —Rachel Miner, group health cost containment expert, Employee Benefit Advisors of the Carolinas
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Emily Payne
Emily Payne is director, content analytics for ALM's Business & Finance Markets and former managing editor for BenefitsPRO. A Wisconsin native, she has spent the past decade writing and editing for various athletic and fitness publications. She holds an English degree and Business certificate from the University of Wisconsin.
