Recently, three titans of industry (Amazon, JP Morgan Chase, and Berkshire Hathaway) who normally would not be thought of as partners, defied conventional wisdom and in a joint statement announced they are working together to solve health care. Initially, they will focus and test their solutions within their own businesses and employee populations. Given that the three entities represent well over 1.2 million employees and a massive market cap, they are well positioned to make a difference. While creating solutions for their own companies, they alone are solving a problem for 1 percent of the employees covered on employer plans in the U.S.
What does this mean for other employers and health care in general?
We will see
At this point, the only details that have officially been released, by the joint statement, are that they are forming a new joint nonprofit venture focused on solving the complex problem of rising healthcare costs through a focus on technology. All will be eagerly awaiting new announcements and leaks that signal more details. Expect what works to be offered to others. Be it for-profit or not, employers are eager for innovation and disruption. They will buy.
One of the many issues employers and their employees face is the low-tech nature of consumer health care, which results in poor user experience. This lack of technology also continues to enable the lack of transparency that challenges consumers, leaving them unable to make value-driven health decisions, especially when those consumers are utilizing High Deductible Health Plans (HDHPs). Amazon has built multiple tech first platforms that have flipped the retail consumer experience on its head. Who’s to say they can’t do the same in health care? Vox has a few guesses about what that might look like.
The announcement sent shockwaves through the publicly traded healthcare stocks, sending them tumbling down by 3% to 7%. I suspect most will recover—but if, and only if they join the movement to innovate. This is also a shot of hope for employers of all sizes that the status quo can be disrupted. Anticipate seeing other unexpected alliances to form in the coming months.
Employers and their employees deserve a better experience. This is not just a bottom-line financial issue. Employees want to have a great “user experience” in the workplace, and today, for most, health care is too complex, expensive, and frustrating. Employers who choose to innovate around their plans, while giving employees the security and stability they need (you don’t have to be Amazon to do it), will win in the war for talent.
Call to action
It’s still too early to understand what exactly the focus of this new, three-pronged venture will be in changing healthcare cost. But while the employees of these three companies, as well as employers and consumers around the country, anxiously await more details of this venture, there are ways to continue to have an impact on your plan(s).
Continue to promote utilization of the cost transparency tools that your health plan offers. Anthem, UHC, CIGNA and other insurers/administrators have resources available to members that allow them to research the prices of medical procedures at different locations, as well as the prices of drugs.
Encourage employees to talk to their physician/providers about the cost of treatments and alternatives that might be available.
Design your health plan with intent. Work with your advisor to ensure that your health plan is designed to elicit the desired behaviors – understand the areas that are driving your cost and utilize plan design, where possible, to promote consumerism.
Paul Ashley, CEBS, is a Managing Director at FirstPerson, an Indianapolis-based strategic business advisory.