Disruption on the way for health care

Americans on average spent $714, or 1.6% of their take-home pay, on out-of-pocket health care costs in 2016, according to a report from JPMorgan. That was up 3.6% from the year before and up 13.5% from 2013. The bank also found that the US spent 18% of gross domestic product on health care, up from 13% in 2000.

 

Amazon, Berkshire Hathaway, and JPMorgan Chase are creating a new business designed to lower health care costs for US-based employees in a move that could shake up the managed-care industry.  In fact the stock price of all insurance companies declined on the release.

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The companies, which employ a combined 1.1 million people worldwide, plan to create a new, independent company they say is “free from profit-making incentives and constraints.” Initially, the release said, it will focus on technology solutions designed to “provide US employees and their families with simplified, high-quality and transparent healthcare at a reasonable cost.”

If you were taken by surprise, you obviously live in a cave.  For profit health care has been under attack recently as costs keep rising among some of the highest paid CEO’s in any industry.

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While it’s too early to understand what their proposal will be, you can bet that it will get done.   This, in my opinion, is just the start.  There is a lot more to come and don’t be surprised if within the near future a “non-profit” pharma company appears.

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