Amazon Health • Hacker News Board

Re: Amazon Health

#41

Post by discodave » Thu, Feb 01, 2018, 2:27 AM UTC

The not for profit part and the fact that this entity won't be owned by any of the companies outright provides an interesting path to a single-payer system.

1. Amazon, Berksire, JP Morgan and others create a large "payer" of healthcare.

2. There are no shareholders or other parties interested in making a profit off of this payer because it is a cost center for the big (or small) companies using it.

3. Wait for the current iteration of the Republican party to lose influence and single-payer to gain more traction politically.

4. When politicians are looking for a way to create a single-payer system, Amazon and friends offer to hand over their large payer to join Medicare, Medicaid and VA systems to form one large government payer, effectively nationalizing the healthcare for Amazon and co.

Re: Amazon Health

#42

Post by secabeen » Thu, Feb 01, 2018, 2:37 AM UTC

simonebrunozzi wrote: post #40

ihsw2 wrote: post #29

Earlier quoted context omitted.

It's about $19K for employer-provided family-coverage. Considering the three companies have about 1M stuff in total, that represents ~$20B in annual recurring costs. This effort combined with accelerating automation will lead to a much better capital:labor cost ratio (and, depending on who you ask, reduction in labor costs is massively bad for wealth equality).

I guess you meant "staff", not "stuff". BTW, I think that the 19k/year is not representative of very large companies, which usually negotiate better terms. Still, your point stands.

Depends. The largest companies often self-insure, where they pay the insurance companies a fixed rate for administration, but the costs of the actual health care come out of the company budget.

Re: Amazon Health

#43

Post by [deleted] » Thu, Feb 01, 2018, 2:43 AM UTC

gowld wrote: post #36

watertom wrote: post #26

I think these 3 will no longer provide health insurance for their employees, they are going to create a new more affordable framework and they will allow any other large company to participate. The goal will be keep the cost of insurance the same for the employees, while eliminating the cost for the companies entirely, which is why this will take off. It’s crazy to have employers paying for healthcare, this I believe…

How will they move the payments from employers to employees? The insurance model and the tax treatment of benefits haven't changed.

[deleted]

Re: Amazon Health

#44

Post by sjg007 » Thu, Feb 01, 2018, 2:47 AM UTC

watertom wrote: post #26

I think these 3 will no longer provide health insurance for their employees, they are going to create a new more affordable framework and they will allow any other large company to participate. The goal will be keep the cost of insurance the same for the employees, while eliminating the cost for the companies entirely, which is why this will take off. It’s crazy to have employers paying for healthcare, this I believe…

What is the mechanism? I don't think it is realistic to assume that health care can run on employee premiums alone. In fact we know it can't b/c individual premiums are outrageous.

So I don't think your premise is realistic. These billion dollar companies self insure and Buffet's companies offer reinsurance for the most costly million dollar claims. Even though they self insure, they will pay a company like Cigna a percentage to manage the claims and get access to their negotiated prices. All I can think of is that this is a play to get Cigna and other insurance companies to lower their management fees.

Companies have to offer insurance and pay it because no one will work for them otherwise. And companies of a certain size have to offer health care by law so it's not going away.

Re: Amazon Health

#45

Post by JumpCrisscross » Thu, Feb 01, 2018, 2:48 AM UTC

thinkingkong wrote: post #4

I read the original announcement and also this analysis. Is it decided that Amazon will “own” the healthcare provider? As far as I can tell this is still a joint effort by several companies with the same philosophy on how to solve the problem. Presumably if other large companies were aligned they could create their own joint partnerships or discuss the possibility of joining this one.

> Is it decided that Amazon will “own” the healthcare provider?

Nothing is decided. Everything currently being discussed is speculation. That said, the article addresses this:

"Amazon doesn’t create an insurance company to compete with other insurance companies (or the other pieces of healthcare infrastructure); rather, Amazon makes it possible — and desirable — for individual health care providers to come onto their platform directly, be that doctors, hospitals, pharmacies, etc."

The author envisions a souped up ZocDoc. It doesn't just help you find providers. You buy your insurance through it; when you book an appointment Amazon handles logistics, billing and payment; as you walk out, your prescription auto-fills or shows you your options, which you (or your insurance provider) pay for through Amazon, and which are delivered to your door--on schedule--by Amazon, et cetera.

Re: Amazon Health

#46

Post by maxerickson » Thu, Feb 01, 2018, 2:54 AM UTC

simonebrunozzi wrote: post #40

ihsw2 wrote: post #29

Earlier quoted context omitted.

It's about $19K for employer-provided family-coverage. Considering the three companies have about 1M stuff in total, that represents ~$20B in annual recurring costs. This effort combined with accelerating automation will lead to a much better capital:labor cost ratio (and, depending on who you ask, reduction in labor costs is massively bad for wealth equality).

I guess you meant "staff", not "stuff". BTW, I think that the 19k/year is not representative of very large companies, which usually negotiate better terms. Still, your point stands.

Overall US healthcare spending is ~$10k per person, so it is probably at least in the ballpark.

Re: Amazon Health

#47

Post by yarg » Thu, Feb 01, 2018, 2:56 AM UTC

sjg007 wrote: post #44

watertom wrote: post #26

I think these 3 will no longer provide health insurance for their employees, they are going to create a new more affordable framework and they will allow any other large company to participate. The goal will be keep the cost of insurance the same for the employees, while eliminating the cost for the companies entirely, which is why this will take off. It’s crazy to have employers paying for healthcare, this I believe…

What is the mechanism? I don't think it is realistic to assume that health care can run on employee premiums alone. In fact we know it can't b/c individual premiums are outrageous. So I don't think your premise is realistic. These billion dollar companies self insure and Buffet's companies offer reinsurance for the most costly million dollar claims. Even though they self insure, they will pay a company like Cigna a p…

Premiums are as high as they are because health care is run as a for profit industry - health care in America is orders of magnitude more expensive than in other countries.

If you remove the profit motive prices will drop down towards something more reasonable, in this situation it's not unreasonable to expect that the system could be maintained with employee premiums.

The cost of initialisation of services will be huge however, it will be interesting to see how they spread it out - they may bear the costs for now, and seek to recoup them providing excess capacity for service to other companies.

Re: Amazon Health

#48

Post by make3 » Thu, Feb 01, 2018, 2:58 AM UTC

watertom wrote: post #26

I think these 3 will no longer provide health insurance for their employees, they are going to create a new more affordable framework and they will allow any other large company to participate. The goal will be keep the cost of insurance the same for the employees, while eliminating the cost for the companies entirely, which is why this will take off. It’s crazy to have employers paying for healthcare, this I believe…

maybe if health insurance becomes one large monopoly, they can have enough leverage to force the health care providers to lower their prices to a reasonable level similar to that of countries where the government has that role (of being a monopoly payer, and forcing the costs to be lower by negotiation leverage)

Re: Amazon Health

#49

Post by maxerickson » Thu, Feb 01, 2018, 3:12 AM UTC

discodave wrote: post #41

The not for profit part and the fact that this entity won't be owned by any of the companies outright provides an interesting path to a single-payer system. 1. Amazon, Berksire, JP Morgan and others create a large "payer" of healthcare. 2. There are no shareholders or other parties interested in making a profit off of this payer because it is a cost center for the big (or small) companies using it. 3. Wait for the cu…

Many existing large insurers are non profits. With millions of members.

BCBS Michigan isn't the biggest one and has 4.3 million members.

Re: Amazon Health

#50

Post by ransom1538 » Thu, Feb 01, 2018, 3:20 AM UTC

watertom wrote: post #26

I think these 3 will no longer provide health insurance for their employees, they are going to create a new more affordable framework and they will allow any other large company to participate. The goal will be keep the cost of insurance the same for the employees, while eliminating the cost for the companies entirely, which is why this will take off. It’s crazy to have employers paying for healthcare, this I believe…

It reminds me of the destruction of pensions. Putting on my tin foil hat, the main killer for health insurance companies is pre-existing conditions -- I wonder if they are confident it wont be in issue soon.