The juncture foray by Amazon, J.P. Morgan and Berkshire Hathaway into health dolour isn’t the newest idea, it’s just the most recent, CVS Health’s chairman bring ups.
The three corporate giants’ announcement they would create a not-for-profit actors aimed at cutting their health-care costs and improving services ignited panic on Wall Street for what it would mean for existing speculators. The partnership of Amazon’s Jeff Bezos, J.P. Morgan’s Jamie Dimon and Berkshire’s Warren Buffett ignited commotion for what innovation they could bring to what’s often considered a distended industry.
But industry experts have cautioned people to temper their tumult, especially since other companies have tried — and failed — almost identical ideas before. About 40 major companies, including vips like American Express and Macy’s, have joined the Health Transmutation Alliance to try to lower costs.
“I think the Buffett, Bezos, Dimon point is ‘we’re mad as hell and not going to take it anymore,'” CVS Health’s Nonexecutive Chairman David Dorman understood CNBC’s “Squawk Box” on Friday. “How they actually do it, the closer you get you realize that virtually 60 percent of the cost is in the providers, so doctors and hospitals. That’s darned disaggregated.”
Dorman thinks it will be a “very difficult effort” since the three can’t lead the decisions their employees make or those of their workers’ doctors.
One way CVS is tiring to lower provider costs is by adding walk-in medical clinics at more of its retail fingers ons. The company currently has more than 1,100 MinuteClinics and 9,800 fleshly locations.
CVS is trying to leverage those physical locations with a proposed $69 billion acquiring of health insurer Aetna. They want to create an integrated fitness system that combines pharmacy and health benefits while discharging preventive care services through the retail clinics.
“So CVS with 10,000 (depend ons) — a store within three miles of 80 percent of the folk, a clinic in the store combining with Aetna — we think we can bring more aptitudes to bear at the local level and serve national organizations and small organizations, as mercifully.”
The CVBS-Aetna deal is expected to close in the second half of the year.