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Amazon’s Future in Healthcare

by Sara Foster | Dec 10, 2018

There has been a lot buzz recently about whether Amazon might be positioning itself to branch out into healthcare. Developments over the past year, such as acquiring PillPack, hiring multiple leaders from the healthcare field and forming a joint venture with JPMorganChase and Berkshire Hathaway to manage employee health can certainly be construed as signs that Amazon has designs on the healthcare arena. photo of healthcare professional with Amazon logo

Should this happen, what might it look like? Here are some potential developments of Amazon healthcare ventures.

  • Employer aggregator. This seems almost like a no-brainer, as Amazon has already set up the partnership with JPMorgan Chase and Berkshire Hathaway that will manage healthcare for 1.2 million combined employees. Going larger scale seems to be a natural progression for the retail giant. It has been speculated that Amazon may try implementing its own health clinics for employees in the Seattle area. By installing known disruptive thinker Dr. Atul Gawande as CEO of the new Amazon venture, Amazon appears to be serious about making changes in this aspect of healthcare.
  • Taking retail pharmacy to the next generation. In addition to its acquisition of PillPack, which caters to chronically-ill patients but is also particularly suited to serving the increasing numbers of self-pay pharmacy customers, Amazon also has its own “Basic Care” line of OTC products. The company has shown that it can compete on cost, convenience and timely shipping. Having health insurance doesn’t necessarily mean a person gets the best price on prescription medications, and people are learning that it pays to shop around and even pay out of pocket to get a better prescription price. Amazon seems to have the infrastructure in place to accommodate people shopping for best prices.
  • Healthcare supply chain innovator. Amazon has shown that it has the shipping thing nailed down. With numerous distribution hubs and partnerships with various shipping entities (Amazon even has the USPS making Sunday deliveries), its logistics are second to none. Could this be leveraged into the healthcare supply chain? There are healthcare organizations looking at this very thing, and some hospitals are already using Amazon to restructure their supply chains. While Amazon doesn’t currently carry highly-specialized medical tools and supplies, who’s to say that the company won't expand their offerings to include these?
  • Consumer-focused healthcare technologies. While tech giants Microsoft and Google have had minimal success with their ventures into healthcare, the growing popularity of wearable tech and the Alexa family of voice-assistant products, along with an increased willingness by consumers to use new technologies, may be the perfect storm for Amazon to develop health-related applications such as patient engagement platforms, an EHR, transparency tools…or even venture into brokering health insurance.
  • Primary care provider. As mentioned earlier, Amazon is exploring the provider side of healthcare. It has already opened a pilot clinic that provides primary care for a “select group of employees” and has plans to increase the number of employees served by the clinic this year. Several primary care experts have been brought on board. Amazon certainly has the online presence infrastructure to venture into telemedicine, and its acquisition of Whole Foods provides a brick-and-mortar potential for retail clinics.
  • Amazon Prime Health? Is there a healthcare version of Amazon Prime in the works? An early Amazon investor who remains close to Amazon CEO Jeff Bezos thinks that just might be coming. John Doerr, chairman of the firm Kleiner Perkins, which invested in Amazon in 1995, said at a recent conference that he thinks Amazon is in great position to use its vast store of customer information to initiate a program of health and medical products. Doerr also sees Google’s parent company, Alphabet, becoming a player in the healthcare market.
Where does a 10-ton elephant sit? Anywhere it wants to. Amazon is the economy’s 10-ton elephant. If it wants to go into healthcare, it’s doubtful anyone can stop it. However, opportunities for partnering with Amazon in various areas of healthcare are sure to be found. 
  • healthcare innovation
  • healthcare providers
  • amazon

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