JPMorgan Chase & Co, Amazon.com Inc., and Berkshire Hathaway will focus on the biggest health issues threatening the US economy in their new joint venture, including aligning healthcare payments with employee health and addressing chronic diseases, CEO Jamie Dimon said in his annual letter to shareholders.
JPMorgan, Amazon and Berkshire announced in January that they would form a venture that would use technology to try to cut healthcare costs for their employees, and potentially open the venture to other companies, but have provided few details since.
Dimon said the company would focus on using big data, virtual technology, better customer engagement and more consumer choice to address critical problems and issues.
“The effort will start very small, but there is much to do, and we are optimistic,” he wrote in the letter.
The group does not yet have a CEO and has not begun operations, Dimon said during a subsequent interview on Yahoo Finance on Thursday.
While the group’s combined employees are fewer than 1 million people and a small slice of the more than 160 million people in employer-based healthcare plans in the United States, Amazon’s strength in using data and technology to disrupt businesses has healthcare investors watching closely. Shares in healthcare companies that act as middlemen, like insurers and pharmacy benefit managers, fell when the news was first announced that the three companies would work together.
On Thursday, the S&P 500 health index, which includes drug distributors, insurers and pharmacies, was up 0.4 per cent.
The letter included six points of focus for the company, including aligning payments with better medical outcomes for patients instead of simply paying for each medical service, which is how the current system is built.
The company will aim to give more control to employees by improving access to their own healthcare data and increasing telemedicine, Dimon wrote. He also pointed to better programs to decrease rates of obesity and smoking, which contribute to chronic disease like cancer, stroke and heart disease, reports Reuters.
Dimon said it would also study the money spent on waste, administration and fraud and determine why there is misuse of specialty medicines and pharmaceuticals. It will also look at money spent on end-of-life care.