Office Tour: Amazon Everywhere | Log recording
Today, the world’s largest online retailer doesn’t just deliver packages. Amazon is slowly gaining a foothold in the healthcare market, one strategic move at a time. For those of you unfamiliar with this activity, don’t be shy. Amazon has been methodical in its efforts. They’ve also failed miserably on many fronts, so they’re not keen on spotlighting all of their healthcare businesses.
Interestingly, failures have been factored in, which is making the healthcare industry very nervous. Amazon’s entry into healthcare was initially self-serving. When you are the second largest private employer in the United States, you have a lot of employees who need health coverage, which comes at an astronomical cost, so why not venture into uncharted territory and create your own network of internal health. No harm, no fault.
Under Amazon’s model, it seemed simple – call it Amazon Care, cut costs, create convenience, and along the way, sell the same internal model to other companies. This worked for their Amazon Web Services (AWS) division. AWS has become one of the leading cloud service providers.
Amazon has found out the hard way that people experience health care delivery very differently than cloud service. Patients surveyed were happy, but it didn’t sell well to companies as expected. Why? Mainly because you need huge infrastructure to manage healthcare outside of your own walls. It was a no-no for decision makers in the boardroom, so let’s get back to the drawing board. Amazon announced on September 8 that it was closing Amazon Care at the end of 2022.
Now, a big announcement made on July 21 is making people think twice. Amazon announced that it has entered into a definitive merger agreement under which Amazon would acquire One Medical. One Medical is a powerful technology-based national primary care organization. Sound familiar? Forget the internal model – it seems Amazon Care was just a wading pool or diversion. Now they are on a well traveled road that has led to streets of gold in the past.
We all need to pay attention to Amazon’s healthcare goals moving forward. Their focus has changed drastically with One Medical, so there must be a master plan in the works somewhere. It hasn’t been disclosed on any level, but when a guy who builds rockets on the side is involved, it drives your imagination wild.
Dr. David L. Holden is president of the Oklahoma State Medical Association (okmed.org).