Amazon, Warren Buffett's Berkshire Hathaway and JP Morgan are forming an unlikely partnership to launch a new employee healthcare company in the US.
The standalone company will be aimed at "improving employee satisfaction and reducing costs" and be "free from profit-making incentives and constraints" with a focus on how technology can make that happen.
“The ballooning costs of healthcare act as a hungry tapeworm on the American economy," said Buffett, chairman and chief executive of Berkshire Hathaway
"Our group does not come to this problem with answers. But we also do not accept it as inevitable. Rather, we share the belief that putting our collective resources behind the country’s best talent can, in time, check the rise in health costs while concurrently enhancing patient satisfaction and outcomes."
Amazon founder and chief Jeff Bezos acknowledged the complexity of the US healthcare system and that the new project would be a difficult one.
“Hard as it might be, reducing healthcare’s burden on the economy while improving outcomes for employees and their families would be worth the effort. Success is going to require talented experts, a beginner’s mind, and a long-term orientation,” he said.
The plans are still at an early stage but will be jointly spearheaded by Todd Combs, an investment officer of Berkshire Hathaway; Marvelle Sullivan Berchtold, a managing director of JPMorgan Chase; and Beth Galetti, a senior vice president at Amazon.
The move sent shares of US healthcare companies sliding. Express Scripts opened more than four per cent lower, United Health and CVS were down more than six per cent and Anthem more than seven per cent as the US market opened.