Three of the largest companies in the United States, Amazon, Berkshire Hathaway, and JPMorgan Chase are partnering together to see if they can cut costs on the health insurance and health care needs they are providing their employees. Currently these companies negotiate with health insurance carriers to provide health care to their employees. However, in the process they have contributed huge profits to Cigna, UnitedHealthcare, Aetna, and other health insurance companies they have worked with in the past.
By bringing the health insurance directly in house, they have decided to negotiate directly with hospitals and doctor networks as opposed to continuing to work with their middle man, the health insurance carriers. This is an unprecedented way companies have attempted to reduce their health insurance costs.
It is difficult to evaluate their strategy because they currently do not have any health insurance plans created nor have they negotiated with any doctors or hospital networks yet. However, this does show how frustrated larger companies have become with the carriers they have access to. If Amazon is able to cut out the health insurance carrier, this would be an entirely new avenue for providing healthcare to employees.
Keep an eye on the news of Amazon's health insurance and health care success. In October Amazon was approved to provide prescription drugs directly to households in 12 states. This is just another step forward in Amazon's efforts to provide healthcare to the world.