Amazon-JP Morgan-Berkshire deal: A sign of the times

January 31, 2018 Rod Hochman, MD, President & CEO, Providence St. Joseph Health

Providence St. Joseph Health has been preparing for disruption in health care by new entrants for some time. In fact, we recently included it on our list of top predictions for 2018.

And earlier this month at the JP Morgan Healthcare Investors Conference, Dan Diamond of POLITICO asked me this question: "Who is the smartest person in health care today?" My response: Jeff Bezos. (You can find the POLITICO interview here.)

Today’s news from Amazon, JP Morgan Chase and Berkshire Hathaway is the latest example of companies from outside health care entering the market. I believe that their out-of-the-box thinking and engagement in health care can be good for their employees, families and consumers. And I actually agree with Warren Buffet when he compares the cost of health care to a “tapeworm” on the U.S. economy - reducing costs has been a major focus for us.

Their announcement strengthens my point of view that Providence St. Joseph Health is on the right track. We are focused on a strategic plan to execute exquisitely well on quality, affordability and experience while also improving the health and well-being of the communities we serve.

In addition, we are teaming up with organizations outside the traditional health care sector to help us innovate and deliver services in better, more convenient and affordable ways. Our collaboration with Walgreens, where we operate Express Care Clinics, is one example of a non-traditional partnership, or what I call “asymmetrical partnerships.”

At Providence St. Joseph Health, we have been hiring experts from Amazon, Microsoft and other innovative organizations to help us transform the way we deliver services, which means we are not the type to feel threatened by those outside our industry. Rather, we embrace innovative thinking and are always looking for partners that can help us find new solutions.

The collaboration between Amazon, JP and Berkshire is making headlines today. But this will certainly not be the last new entrant to wade into health care, which currently makes up 18 percent of our nation’s gross domestic product. We can expect much more to come.

The message to traditional providers is clear: evolve or risk being disintermediated. With our strategic plan, I am confident that Providence St. Joseph Health is well positioned to transform successfully on behalf of the communities we serve.

 

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