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The Big Story: Amazon to Buy One Medical Network of Health Clinics in Healthcare Expansion

“’We think healthcare is high on the list of experiences that need reinvention,’ said Neil Lindsay, of Amazon Health Services. ‘We see lots of opportunity to both improve the quality of the experience and give people back valuable time in their days.'”

And: Dr. Amazon will see you now

“‘If you ask the majority of American consumers what they think of the current healthcare system, their experience is terrible’ says Elizabeth Mitchell of the Purchaser Business Group on Health. ‘It’s been frustrating to try to work through the existing players and the big incumbents in the market. I do expect to see more of this because frankly, the industry hasn’t been responsive.'”

What it Means for Healthcare

They’re here.

The logos of Amazon, CVS, Walmart and Walgreen have haunted countless strategic planning PowerPoint slides, playing the role of the pointy stick to spur lumbering, incumbent healthcare systems to transformative change or to whip ever-faster growth by PE-backed players racing to acquire providers and market share.

But the threat was ignorable, too. Because healthcare is too hard, too complex for someone to really break through – isn’t it? These big consumer behemoths were just playing around the edges with packs of pills and teledocs. The centuries-old provider brands are immune to incursion. Right?

This week the threat, or the challenge or the opportunity – pick door one, two or three carefully – became much more real.

Christina Farr, former CNBC health reporter now investor, tweeted this:

It’s a good question.

As a healthcare leader, here are three questions to ask your organization right now:

1. Is your patient experience market ready? Amazon’s showing the industry their cards. An improved customer experience is a theme dominating the coverage of Amazon’s news. Here’s Farr again, echoing many others (including Amazon itself): “They want to nail the consumer experience.”

This is not a surprise, and Amazon is not unique in its pursuit of a better comprehensive experience for patients and staff. It’s built into the design of One Medical and that of many private equity-backed organizations expanding into care delivery. In the past, traditional providers have sometimes confused the quality of care with the experience of delivering and receiving it.

If your organization needed another push to advance its PX work – from your digital front door to your after-care billing – here it is.

2. Are you ready to partner? The leap from primary care to acute care is a big one. Health systems have been watching PE-backed rollups move into their markets, snapping up physician practices and other services…and sometimes offering better services, compensation and prices.

In some cases, it’s a tooth-and-nail competition. In others, strong partnerships have flourished that benefit traditional providers, non-acute specialty providers and patients. No doubt partnerships and collaboration will shape the future of care.

So, what’s your stance and story on partnerships? Do you enter a market to dominate or collaborate? Do you welcome newcomers or fear them? Now’s a good time to shape your partnership strategy and pursue the partnerships that make sense for your organization.

3. How can you be different in a crowded market? Amazon’s big bet in primary care will stir more investment in caregivers as a platform and serve as a launch pad into more focused specialty care. Many other private equity groups are already well invested in the space; others are sure to follow now. An already crowded field will see more players – read, “competitors” – looking to buy the same physician or service. What’s the story that makes them pick you?

Of course, none of this is to say Amazon will have an easy road into care delivery. They may forever be just a fearsome logo on a slide. But there are now 3.9 billion reasons to take it more seriously.

We’re watching this development for what it could mean for both traditional providers and health services companies. In the meantime, ask Alexa if she can help schedule your next well visit.

This piece was originally published over the weekend in our Sunday Quick Think newsletter. Fill out the form to get that in your inbox every week.

Jarrard Inc.
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