back to article Billionaire bros Bezos, Buffett become bonkers bio brokers: Swap W in AWS for H for healthcare

Stocks in US health companies are down sharply after Jeff Bezos and Warren Buffett announced they want to get into the healthcare business. Frankly, we don't know who to root for in this one. The Amazon boss said he would be teaming up with Berkshire Hathaway and JPMorgan Chase and Co to start an company focused on lowering …

  1. Anonymous Coward
    Anonymous Coward

    America Fuck Yeah

    Wait - Someone is actually trying to fix the country? - Say it ain't so... The vested interests here, the complexity, even with that silicon valley war chest, it'll be hard. Hope they do it though. Otherwise between the hilarious cost of education + the depressing cost of health, America is truly fucked!

    1. Tom 64

      Re: America Fuck Yeah

      Nope, remember these 'founders' are capitalists. I doubt they'd be in it if they didn't think they could turn a tidy profit.

      1. Blank Reg Silver badge

        Re: America Fuck Yeah

        They have said this would be not for profit, but if it reduces health insurance costs for their companies then it would certainly help their profits.

        Between their employees and their families they must have a couple million people they could insure. That's already large enough to make it viable, but I could see other large employers jumping on board, it could quickly balloon to 10's of millions.

        1. paulf
          Pirate

          Re: America Fuck Yeah

          @Blank Reg, "They have said this would be not for profit, but if it reduces health insurance costs for their companies then it would certainly help their profits."

          Perhaps not directly profitable, but can you really see a scenario where all that juicy personal health care information doesn't somehow trickle its way back to your Amazon account?

          "Items inspired by your last Doctor visit: High fibre cereal from 'Amazon Whole Foods', Soft cushions, Preparation H (Subscribe and Save!)"

          1. Raffbone

            Re: America Fuck Yeah

            I do realise that this was writtent in semi-jest:

            "can you really see a scenario where all that juicy personal health care information doesn't somehow trickle its way back to your Amazon account?"

            But PHI and ePHI is covered by HIPAA, which is generally known not to fuck about.

      2. John Brown (no body) Silver badge

        Re: America Fuck Yeah

        "Nope, remember these 'founders' are capitalists. I doubt they'd be in it if they didn't think they could turn a tidy profit."

        Maybe they just bought a load of healthcare shares after their announcement and will, in 6 months or so, decide their venture into the healthcare arena was a mistake, then sell off those share on the uptick.

        Profit!

  2. Dr Scrum Master

    Health care or health insurance?

    These two different terms keep getting thrown around, but which one do you actually mean?

    1. Voland's right hand Silver badge

      Re: Health care or health insurance?

      They are connected at the hip.

      1. phuzz Silver badge
        Thumb Up

        Re: Health care or health insurance?

        "They are connected at the hip."

        Not sure why you got the downvote for that, they certainly are connected in the US. Indeed, what's the point of health insurance if not providing health care?*

        *(and making someone a massive profit obvs)

        1. Dr Scrum Master

          Re: Health care or health insurance?

          what's the point of health insurance if not providing health care?

          I thought the point was to provide a means to pay for the care, not to actually provide the care itself...

          1. rmullen0

            Re: Health care or health insurance?

            Health insurance is for corporations like United Health to make money denying patients the health care they need so they can make more money for their shareholders and give their CEO a massive undeserved paycheck. That is business in America.

      2. Chemical Bob
        Unhappy

        Re: Health care or health insurance?

        "They are connected at the hip."

        Not really. Health care is when a medical professional is working on your behalf, health insurance is that little runt in "The Incredibles" screaming "What about the shareholders?!"...

        And don't think Bezos is being benevolent. His goal is to lower the cost of health insurance. This can be achieved by making it completely useless.

    2. rmullen0

      Re: Health care or health insurance?

      That is exactly right, we don't need another health insurance plan, we need health care. Do not fall for the corporatist ploy. Use what has been PROVEN to work in numerous other countries. SINGLE PAYER like MEDICARE FOR ALL. The oligarchs are just trying to muddy the water. Don't forget that Jeff Bezos puts ambulances outside the warehouses he is too cheap to air condition so that the employees can be hauled off when they overheat.

  3. Gene Cash Silver badge
    Go

    Considering the steaming turd pile that is American health "care", he's not got much of an opponent.

    We've got doctors & nurses that can't use computers and are proud of it. We've got a system that couldn't tell me which bone was broken, and was wrong when it decided it knew. And we've got doctors that do stuff like feeling my tonsils for the hell of it to turn a consultation into an exam so they can double their bill. I dropped a dime about that last one and now he's being investigated.

    I hope Bezos burns it to the ground.

    1. Blank Reg Silver badge

      I think that really is the only way to fix it. Destroy it all and start over. Step one, wipe out the health insurance companies by undercutting them with this new company. Once they are out of the picture they can then negotiate drug prices on a massive scale. When both the health insurance companies and drug companies lose their ability to bribe politicians then something can be done.

      1. Adam Foxton

        If only they had influence with a number of Big Pharmacy companies to get them discounts for nationwide-grade bulk-buying, an efficient distribution network, and the tech to make this function properly.

        Oh, wait!

        Come on Bezos, show them how it's done!

        1. rmullen0

          Let us not forget that Amazon is one of the companies with the most people on welfare because he isn't willing to pay them a living wage.

      2. John Smith 19 Gold badge
        Coat

        Once they are out of the picture they can then negotiate drug prices on a massive scale.

        Meet the new monopoly.

        Same as the old oligopoly...

      3. HmmmYes

        Yeah, youve fallen for hte big bad drug makers story.

        3/4 of healthcare cost is on salary.

        The bulk of drugs used, day to day, are either cheap or their are generics available.

        The only reason why a (merkin) Dr prescribes Get-WellO-Quix! pill is tha the sales rep is taking Dr out to golf at Vegas.

        1. Anonymous Coward
          Anonymous Coward

          er, no, you are completely factually wrong ..

          just google it https://www.google.co.uk/search?q=american+pharmaceutical+prices+highest&ie=utf-8&oe=utf-8&client=firefox-b-ab&gfe_rd=cr&dcr=0&ei=289xWpa0DMqAgAaOlYG4Dg#cns=1&gfe_rd=cr

          on an anecdotal level my missus has to take levothyroxine for the rest of her life - a cheap as chips generic... here under 6£ cost to the nhs for 3 month supply. In the US she's paid north of $60

      4. John Brown (no body) Silver badge

        "Once they are out of the picture they can then negotiate drug prices on a massive scale. When both the health insurance companies and drug companies lose their ability to bribe politicians then something can be done."

        You'd almost think that was possible too, then you look at the NHS in the UK and realise they just pay whatever they are asked for.

    2. Anonymous Coward
      Anonymous Coward

      Considering the steaming turd pile that is American health "care", he's not got much of an opponent.

      Is American health care that bad, or is it how it is funded that is bad?

      My brother in law is an anaesthetist here in the UK, and he recently did a 1 year placement at University of Michigan teaching hospital. His comparison of the UK system vs the US system was kind of shocking. The US hospital had end to end digital test results and scans, visible from any/many devices. UK had paper charts and hard print scans at the time.

      In the both countries, he worked similar amounts of time, but in the US he spent more than twice as much time in surgery than in the UK, because everything was arranged around getting the maximum output from the surgical teams.

      To be fair, this is one of the more advanced hospitals, a teaching hospital well endowed by alumni etc - but then so is the hospital he works at in the UK

      1. Anonymous Coward
        Anonymous Coward

        Speaking as a Canadian who's had healthcare (both surgical and non-surgical) in the US, the healthcare experience in the US is stellar - especially when compared to Canada.

        Lower wait times, X-ray machines that are brought to your bed, actually friendly and caring nursing staff - I could go on and on.

        In my experience, it's how the funding is handled - and it's supposedly not cheap.

        I had insurance each time - so I didn't pay anything out of pocket. However, until my insurance provider got off their collective arses, I was getting bills and notices to pay up or else.

        This is all anecdotal experience

      2. Yet Another Anonymous coward Silver badge

        The care, if you get it, is the best in the world

        The problem is that you as "the consumer" are responsible for everything.

        Visit the same doctor for the 3rd follow up for the same problem? Did you check that they, the lab they used for tests, the hospital they referred you to are are all still covered in your plan (they might have switched yesterday) if not, you pay.

        Did a doctor not in your plan happen to look at your x-rays alongside your doctor? You pay.

        Get any of these wrong on a major surgery and you are bankrupt.

        Then there is the massive billing inefficiencies, it's like the worst car insurance + worst mobile phone + worst cable company billing depts are mixed together.

        Expect to get final demands for bills for $10Ks that are already paid by the insurance, then bills for $0 then demands for -$10Ks for years following any visit. Expect to spend hours on the phone trying to correct this

        1. rmullen0

          My dad broke his collar bone while on a fishing trip in Canada. Stupidly, he came back to the U.S. to get it fixed. A month after they put a lien on his house for the bill.

  4. John Smith 19 Gold badge
    Unhappy

    Buffet's often said the trouble with BH being so big is the lack of stuff you can buy into.

    I don't mean could buy into but want to buy into.

    That is that's well enough run they are happy to invest and gives the sort of return they expect on a long term basis.

    I'm betting he's seeing this more from the "Health Insurance" end (BH started in insurance) than the IT stuff.

    1. Alistair
      Windows

      Re: Buffet's often said the trouble with BH being so big is the lack of stuff you can buy into.

      @JS19:

      "well enough run .... gives the sort of return they expect on a long term basis"

      (emphasis by Warren Buffett)

      The issue (and Mr B. has made this point) is on *real* value and long term viability. Neither of which is what the wall street 'miracle boys' (his term) are after - IBM and HP are both demonstrations of what happens when real value meets large technological change that alters long term viability, the resulting internal changes are driven by the 'miracle boys' cult of *stock value* over real value.

      Bezos' company does a balancing act of being only barely profitable, but having the balls to keep trying 'the next little miracle', Buffet's company does the 'long view'. Tackling the OMG, next quarter targets ..... attitude of the modern day MBA crowd is something I suspect that they'll be able to do.

      Somewhere in here the comment was 3/4 of healthcare costs were salary... This is technically true, *anywhere* outside of the US. Sadly, when the health care company is listed on the stock market, this becomes less true. I've seen brilliantly operated hospitals in the US, that do great things. However, one needs to be insured, and well insured, and able to *get* to the hospital, either by Uber or taxi or on your own two feet, in order to access this care. I've also seen what passes for 'the rest of them', the hanging on by a thread, armpit deep in disaster cases that 'everyone else' has as their only options.

      When the medical tech companies, the pharmaceutical companies, the insurance companies, the hospital companies, and the pharmacies are *all* driven by wall street miracle boy next quarter growth in profitability logic, you have the US health care system.

      For the sake of my US relatives and their various offspring I can only hope that Bezos and Buffett can shake the overall disaster of US medical/health insurance up sufficiently to change the direction the country is headed.

  5. Anonymous Coward
    Anonymous Coward

    The health care industry is right to be terrified

    Since they are proposing this be non-profit, and with a million members from day one would be a powerful negotiator on the market. I'm sure many other big companies would be interested in joining once they get it off the ground.

    Look for them to lobby congress to pass a law making this illegal, and republicans to sell the law as being good for America with undertones of socialism/communism as the reason.

    1. Charlie Clark Silver badge

      Re: The health care industry is right to be terrified

      Even if they follow though on this, it doesn't really change the underlying problem with US health insurance in that it is tied to the employer.

      1. Anonymous Coward
        Anonymous Coward

        Re: The health care industry is right to be terrified

        Agreed, but assuming that by squeezing the profit motive out of their insurance company they are able to provide better health care at lower cost than the for-profit competition, the whole thing will snowball. Employers will want to switch to them to save money, and employees will want to switch for better care, and they'll eventually drive the for-profit insurance companies off the market.

        At that point they'll dominate the insurance landscape, and can begin forcing change on the rest of the industry. Also, once they administer almost all employer paid insurance they could take on individuals without much regard to their health status. Maybe this can be a route to single payer health care in the US, started not by the government but by "free enterprise" (in quotes because no doubt some will try to call it anti-capitalist because of its non-profit status and the fact that if successful it'll run all the for-profit insurance companies out of business, and no doubt cause major changes in the amount of profit for-profit hospitals and drug companies are able to make)

        So it could potentially fix the "you need a job with an employer who offers insurance" to get insurance at an affordable (non-subsidized) cost problem, but it is way to early to know. Certainly a better chance than sticking with Obamacare as is, or the republican plan which is basically "let's go back to the good old days of 2008". Nice to see a gang of liberals give the finger to the health care industry and their bought and paid for congressional lackeys, hopefully it will eventually destroy the current health care landscape and replace it with something better.

  6. Anonymous Coward
    Anonymous Coward

    I guess when your government is too incompetent to provide a proper health care system, it's really up to the private sector to find a solution.

    1. Anonymous Coward
      Anonymous Coward

      Why is it the govs job?

      "guess when your government is too incompetent to provide a proper health care system, it's really up to the private sector to find a solution."

      Why is it up to the .gov to provide? It's not a function of government. Maybe if they got the hell out of the way, it might get better.

      I eagerly await the BB&D* health care non-profit system. We'll see what they alone know that no one else does eh?

      Bezos,Buffet and Dimon. Also known as Bullshit, Bluffer and Bankster.

      1. Yet Another Anonymous coward Silver badge

        Re: Why is it the govs job?

        Is fire and police - or should they be privatised.

        It might be cheaper to pay my local Italian American Family Business for protection rather than pay for a police force that don't do anything to stop me being robbed.

  7. Teiwaz Silver badge

    That photo

    His mad eyes......does anyone know if he looks predominantlyat left ears*?

    Seriously looks like he's one management meeting from a David ** moment....

    ** Icke, Koresh, whatever.

    * If you missed this reference (Jake) Terry Pratchett - Light Fantastic.

    1. John Smith 19 Gold badge
      Thumb Up

      "Looks like he's one management meeting from a David ** moment...."

      Nice.

      Although, y'know, built a multi $Bn business so not unimpressive grasp of how to operate on a large scale.

  8. HmmmYes

    I can reduce US - and UK's - heathcare in one simple sentence:

    - Weigh people and adjust their premiums according to how fat they are.

    Bang! That would knock a good 10% of the cost.

    And, no, fat people dont die earlier, saving moving. They just stop moving, requiring more and more medical invention.

    1. Charlie Clark Silver badge

      That would knock a good 10% of the cost.

      Apart from the ethical and practical issues of what you suggest (what conditions, behaviour, genes, etc. do you take into consideration? How often do you do it?) there's also the simple problem of the maths: charging fat people more won't reduce costs, just increase the budget

      1. HmmmYes

        Yeah youve got a point. What about those peoples with big bones...

        Have you seen how much the NHS spends on type2 diabetes? Then when they lazy arse carries on, having to remove one or more leg?

        The US is even worse - look at the MediCare spend on poor fatties.

        The increase in premiums is to cover extra cost *AND* provide an incentive to lose wieght.

        1. Charlie Clark Silver badge

          The increase in premiums is to cover extra cost *AND* provide an incentive to lose wieght.

          The problem with making the insurer do this is that it is more or less an invitation to "death panels". It's also inflexible and slow.

          The traditional approach is to apply "sin taxes" at the point of consumption, such as duty on tobacco and alcohol. Experience shows, however, that governments like to set such duties to optimise revenue rather than reduce consumption. Such duties are evidently (we have years and years of evidence) not sufficient on their own; the reveues rarely cover the cost of care and never the loss of earnings to the employer. There is a mooted sugar tax but Coca-Cola et al. have already successfully lobbied against this. And if you think the UK and the US are bad, wait till you see Latin America!

          So you need additional measures including education, including labelling, and possibly even bans, assuming you have legislation the lobbies can't sue you over. It would also be nice to reduce subsidies (both tobacco and sugar have direct subsidies, alchohol indirect). Even then you'll have to fight tooth and nail: the public health arguments against tobacco were no longer disputed by the 1970s and it took nearly 40 years to get the legislation that made a significant reduction in the number of smokers.

          But at the end of the day you're also going to have to live with and budget for a part of the population with unhealthy life styles. Paying them to go for a 2 km walk everyday is about the best you can hope for.

  9. Anonymous Coward
    Anonymous Coward

    Frankly, we don't know who to root for in this one.

    The way I see it, there are three possible outcomes from this:

    1. They fail. The established players are too strong, and they don't have any effect on the industry.

    2. They succeed, but don't change anything; just take over the mantle of greed from the established players.

    3. They succeed and actually do what they say they want to do and change things for the better.

    From where I'm sitting, if I weigh up those possibilities as positive, negative or neutral, I get two neutrals and one positive, which means that I think we should definitely be rooting for Bezos and his buddies in this one.

    I guess it's possible that they could end up being even more greedy, corrupt and immoral than the established players, but frankly, looking at the healthcare industry today, that seems unlikely, bordering on the implausible.

    Just ask yourself this: Who would you rather controlled the price of your drugs: Jeff Bezos or people like Martin Shkreli?

  10. PhilipN Silver badge

    Jim Clark and WebMD

    Yes that Jim Clark. Serial billionaire.

    His idea with WebMD was to drag medical care into the digital era. It did not.

    Jim Clark stumbled once (if memory serves) trying to invent video streaming. Florida I believe. Too far ahead of its time.

    If he was also 20 years too early with WebMD then maybe Bezos and Buffett are on to something. It is about time.

  11. rmullen0

    Medicare for all, not Oligarchcare

    With all due respect, we don't need help from the same 1% SOBs that are destroying the country. We need Medicare for all, a single payer system, like every other developed country has, not some corporate plan. We already tried that and it doesn't work.

    1. MJI Silver badge

      Or a national health service paid by taxes.

      You know it might work.

  12. yellowlawn

    Am sure the issues with healthcare in the States is down to that fact that most Americans don't want to pay for any healthcare until they actually need it. Healthcare may be massively underfunded here in the UK but at least it's available whenever it's needed. And you don't get kicked out of hospital when the money runs out.

  13. Michael Wojcik Silver badge

    A what now?

    "Success is going to require talented experts, a beginner’s mind, and a long-term orientation."

    What the ever-lovin' fuck is "a beginner's mind", and why the hell would it be a good idea to put one at the front of an attempt to reform a hugely entrenched and complex system on which pretty much every US resident's life depends?

    Honestly, Bezos, you say some complete shit.

    (I'll pass over "long-term orientation" without comment. Far be it from me to judge his romantic inclinations.)

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