It has been two months since Amazon, Berkshire Hathaway and JPMorgan Chase announced a triple-threat partnership to improve health care for their collective 1.2 million employees, and ultimately a better program for all Americans.
So far we have heard nothing from the companies, except a flurry of outside opinions about Prime Health and coughing into Alexa to diagnose the flu. Fortune confides that the Seattle company's real plan is to control and data mine "your individual biology."
The best theory so far? They are coming after the middleman.
These players are chockablock in the health care industry. Insurance companies take 20 cents of every health dollar off the top. But for every dollar spent on drugs, 41 cents gets taken by middlemen, such as the pharmacy or the formulary manager.
Amazon has run over the middleman in any number of categories: books, music, videos, groceries, IT services, lawn furniture. Amazon goes to the lowest price, eliminates multiple retail and wholesale markups and bears a much lower profit margin to take share away from its rivals.
The big insurers and other health care companies will hardly roll over. Instead, they have been getting bigger and more powerful.
In 2017 health services companies completed $175 billion worth of mergers, two and a half times that of 2016. That included CVS buying Aetna for $69 billion and UnitedHealth spending $5 billion to buy 300 medical clinics.
Amazon's initial significant opportunity may be to ship drugs and supplies quickly and cut out CVS and Walgreens. (One clue: It has applied for pharmacy licenses in a dozen states.)
