
What might the Amazon, Berkshire and JPM health care joint venture actually do? - prostoalex
https://25iq.com/2018/02/23/what-might-the-amazon-berkshire-and-jp-morgan-health-care-joint-venture-actually-do/
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joncrane
What I'm getting from this is a) It's mostly conjecture b) The author thinks
it's likely that they will be creating something akin to "Kaiser Permanente
lite"

Is there something else I'm missing?

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jonwachob91
Yea, sounds like Warren Buffet isn't really behind this whole thing (entirely
my observation). This morning on CNBC he was asked about the deal and only
mentioned about how it was really Todd Combs that orchestrated this thing.
Buffett doesn't even commit to forming a company for this new insurance idea
(also of note, insurance businesses are one of Buffett's largest sectors of
ownership, why note just instruct them to fix this issue???)

[1] [https://www.cnbc.com/2018/02/26/full-transcript-
billionaire-...](https://www.cnbc.com/2018/02/26/full-transcript-billionaire-
investor-warren-buffett-speaks-with-cnbcs-becky-quick-on-squawk-box-
today.html) (Search for Todd Combs, it'll bring you to the first paragraph
talking about the healthcare insurance venture thingy).

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erubin
is Berkshire in the health insurance business at all? Property/casualty and
auto is presumably pretty different.

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nradov
Yes it's almost completely different. A few of the actuarial concepts are
similar but almost nothing else carries over. In fact, most health "insurers"
have shifted away from selling insurance policies and toward becoming third-
party claims administrators for self-insured group buyers.

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tyingq
Show us all what leverage is worth, perhaps? For my own small biz, $2500/month
for one employee+family bought parity for solely health. I was far behind for
dental/vision/etc. As a now employee of a large company, $500/month gets
better returns than $2500/month as a nobody did.

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nradov
That's probably not a direct apples-to-apples comparison because large
employers typically subsidize employee health plan premiums.

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mgkimsal
yeah, would really like to know what the actual cost the company pays is, vs
the employee share. might still be lower than $2500/month (probably) but I
can't imagine a family plan in any major state costing $500/month, even with a
huge deductible (I sorely wish it did tho!)

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aaavl2821
One very simple thing they could do that might be helpful is provide an easy
to understand guidebook for understanding the quality of various healthcare
providers. Sort of a Michelin guidebook for healthcare

Currently, patients don't have the resources or information to assess the
quality of their providers. Hospitals with fancy marble lobbies are more
likely to be rated as high quality than hospitals with better quality scores
but dingier interiors. People think that if care costs more, it must be better

Insurance companies have tried to build narrow networks that exclude high cost
hospitals that nonetheless are publicly perceived as high quality, but public
backlash, however misinformed, can quash these efforts. One example is UCLA vs
BSCA a few years ago

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dragonwriter
> One very simple thing they could do that might be helpful is provide an easy
> to understand guidebook for understanding the quality of various healthcare
> providers.

That's not a simple thing to do, especially well, and you kind of implicitly
note with your reference to existing quality ratings that lots of people have
tried to do it with mediocre results.

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aaavl2821
I think there is an opportunity for the amazon / BH / JPM JV to use its scale,
visibility and "outsider" status to create a standard that is simple and easy
to understand by consumers, and actively market that standard in a way that
medicare, startups or industry coalitions have not been able to

most quality standards are not even well known or standardized within the
healthcare industry, and there are so many competing interests that it is hard
for providers, payers, other stakeholders to align on a standard, useful and
enforceable definition of quality. the JV is already insanely visible / high
profile without anyone knowing what it does; if they create a quality rating
system it will certainly get more attention than any other one created to date

also, amazon / bh / jpm in theory is better aligned with society in terms of
what they want out of healthcare: 1) lower cost and 2) customer satisfaction.
that group cares about making its employees happy, whereas other stakeholders
dont have the same direct accountability to employees / patients: payers are
only accountable to patients through the employers they serve, and providers
are in theory accountable to patients but in reality more influenced by the
health system that owns them or the payer that pays them

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nradov
The major quality standards are published by CMS (Medicare) and they're very
well known because reimbursement is now tied to hitting those metrics.

But in a broader sense it's really impossible to define objective quality
metrics for individual healthcare providers. If a heart surgeon has a high
patient death rate is it because she's incompetent or because she takes on the
most fragile patients that no one else is willing to operate on? You might
think that those differences could be controlled for but in reality there are
too many confounding factors and research hasn't even been done to accurately
quantify many of them.

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aaavl2821
It is hard, and once you've defined quality metrics, it's even harder to write
a contract that captures them and get parties to agree on them

The latter issues might be resolved somewhat by the Amazon group; the former
is still a concern, but I think there are opportunities to do meaningfully
better things

This is just an idea, and I've not done much research on it, so take with a
grain of salt: I think patient focused quality measures might be better. For
example, look at cohorts of patients with similar characteristics (like in
case control studies) who are experiencing a similar health event (knee
surgery) and compare providers based on the outcomes these types of patients
have. This is something the JV could do, is patient focused, and avoids all
the challenges you mention with metrics measuring / managing individual
providers (which isn't just hard to measure but demoralizing to docs)

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nradov
That's exactly the problem. There's no reliable way to construct a cohort of
"similar" patients. We don't even know all the variables other than provider
quality which impact the outcome of knee surgery. Do we have to consider age?
Genetics? Sex? Fitness level? Co-morbid conditions? Blood Type? Personality?
Something else? That data simply doesn't exist, and won't exist in our
lifetimes.

With large enough populations some of those confounding variables even out.
But that doesn't help when trying to evaluate individual providers who treat
relatively small numbers of patients per year.

Of course in any area all of the local doctors know from subjective experience
and word-of-mouth which other doctors are skilled and which are quacks. But
none of them will say so publicly, and you can't quantify those opinions.

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aaavl2821
People do case control studies all the time, the factors used depend based on
disease but there is plenty of literature to support selection of matching
factors

I think it would make sense to start at the hospital level; provider level
probably isn't feasible as you say. Hospitals see enough patients where the
sample sizes are pretty big, and they are the main cost driver in healthcare,
so rating hospitals by cost / quality could work

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crb002
1) UX for doctors. Make it easy to log records of visits without secretarial
support.

2) Pharmacy at the Amazon warehouse for 90% of most used drugs.

3) Diabetes/endocrine specialist by Amazon as a kiosk in Whole Foods. Most
preventable illness in the US is because of sugar over consumption, the rest
we can't prevent.

Boom. They just shaved 20% off costs.

