Amazon’s Soaring Healthcare Ambition
Amazon’sHealthcare is a mess in the United States. Consumers pay more and get less than in most other developed countries. Strong comprehensive healthcare is unaffordable for most without substantial help, which is why putting the burden on the government really does not work.
If people cannot afford something, individually aggregating it under what amounts to a tax is not really any better — and given the extra overhead, arguably is worse.
One way to do that is to have a new player enter the market at massive scale and use its buying and political power to force the industry to reduce excessive pharmaceutical gouging, waste and excessive testing, and erect a stronger barrier to excessive litigation.
Amazon, which last week announced its entry into the healthcare market with JP Morgan and Berkshire Hathaway, could be that company. However, as I recently discovered, Amazon already has abused its power. What will happen if it gets massively more powerful?
I’ll share my thoughts on that this week and close with my product of the week, one of the most innovative smartphones in the market.
The Real Healthcare Problem
If you look at the World Health Organization rankings, the U.S. is No. 1 with a bullet on cost (the most expensive of any country in the survey) but ranks a lousy No. 72 on performance.
You know which country ranks first on performance on level of health? Oman, which is No. 62 on cost. France, a country often ridiculed, ranks No. 4 on performance and No. 4 on cost.
Its state-sponsored system is aligned at least. However, Italy outperforms France, ranking No. 3 on performance but No. 11 on cost. Saudi Arabia is No. 10 on performance and No. 63 on cost.
Using President Trump’s “winning” rhetoric, when it comes to healthcare, the U.S. not only is not winning, but also is arguably behind the world on cost benefit.
Even North Korea is better aligned than the U.S. — it is No. 172 on cost and No. 153 on performance (North Koreans do not get much, but they pay even less).
With all of its technology and unique advancements, the United States sucks at healthcare. The real problem with Obamacare is that it does not fix the “suck” part or the cost part — it just shifts where the bill goes.
So, a whole bunch of U.S. citizens, myself included, now are paying more and getting less coverage. That is neither any way to get re-elected nor any way to run a country.
Typically screwing your constituents does not work well for elections, and that played a much bigger role in the last election than most realize (or want to admit).
I think Jeff Bezos gets this — it’s not rocket science. He likely understands that if the government really is not going to step up (it still is arguing over who pays, not the amount on the bill) then a heavy-hitting corporation must.
Amazon has the reach and capability to reduce healthcare costs massively through better records management;
implementation of aggressive artificial intelligence-based diagnoses or diagnosis validation;
ability to negotiate better drug prices;
scalable AI-based patent monitoring;
and policies that could address abuses, such as the overuse of painkillers, more effectively.
Individual benefits would include better and more comprehensive access to medical records; programmatic analysis of those records, triggering proactive medical procedures;
more aggressive health monitoring; and far broader access to emerging medical technology and drugs.
The Problems With Amazon
Amazon already has gained an inordinate amount of power, and there have been signs of organizational abuse.
I personally experienced it when I questioned a series of charges on a little-used credit card, and Amazon suddenly dropped me, with no warning, back into the pre-Echo dark ages.
I’m still rebuilding the damage it did, even though it reinstated me last year.
With Amazon increasingly handling everything its customers consume, a dispute with the company could result not only in the loss of Echo functionality, but also in access to critical healthcare.
Without far stronger customer controls, I have my doubts whether Amazon’s foray into healthcare will end well rather than becoming just another, deadlier, problem for many American consumers.