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Amazon, JPMorgan, Berkshire Are Creating a Health Care Company That's 'Free From Profit-Making Incentives'

Amazon, JPMorgan, Berkshire Are Creating a Health Care Company That's 'Free From Profit-Making Incentives'
From TIME - January 30, 2018

Amazon is diving into health care, teaming up with Warren Buffetts Berkshire Hathaway and the New York bank JPMorgan Chase, to create a company that helps their U.S. employees find quality care at a reasonable cost.

The leaders of each company, Amazons Jeff Bezos, Buffet, and JPMorgans Jamie Dimon, offered few details Tuesday and said that the project is in the early planning stage.

The ballooning costs of (health care) act as a hungry tapeworm on the American economy, Buffett said in a prepared statement. Our group does not come to this problem with answers. But we also do not accept it as inevitable.

The new company will be independent and free from profit-making incentives and constraints. The businesses said the new ventures initial focus would be on technology that provides simplified, high-quality and transparent care.

It was not clear if the ultimate goal involves expanding the ambitious project beyond Amazon, Berkshire or JPMorgan. However, JPMorgans Dimon said Tuesday that, our goal is to create solutions that benefit our U.S. employees, their families and, potentially, all Americans.

Shares in health care companies took a big hit in early trading Tuesday, hinting at the threat of the new entity to how health care is paid for and delivered in the U.S.

Before the opening bell, eight of the top 10 decliners on the Standard & Poors 500 index were health care companies.

The need for a solution to the health care crises in the U.S. is intense. With about 151 million non-elderly people, employer-sponsored coverage is the largest part of the U.S. health insurance market.

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