On January 30, industry giants, Amazon, Berkshire Hathaway and JPMorgan Chase announced a planned collaboration on a health care solution for their employees. According to their statement, the newly formed company will be “free from profit-making incentives and constraints.”
“The ballooning costs of health care act as a hungry tapeworm on the American economy,” Warren Buffett said in Tuesday’s statement. “Our group does not come to this problem with answers. But we also do not accept it as inevitable.”
While their efforts are at an early stage, some employers are currently benefiting from transparency and utilizing tools to control their health care spend. By creating an environment of transparent pricing and engaged employees, costs have been reduced by upwards of 40{b97d180a8a49f04872ef972912bfa9553acbb9c22aded732b394a1613ca7eaf9}. This change doesn’t happen overnight, but over time as more employees become better consumers of health care.
These employers are not a specialized subset of the economy. Proven strategies are already working in urban and rural environments, for small and very large companies across diverse socioeconomic populations.
An independent TPA, not tied to the Blues, United, Cigna or Aetna, is the only way to accomplish this goal. A vast majority of the toolkit available to control spend is not applicable in those relationships.
The last 20 years have been a period of stagnation for middle and working-class wages. Health insurance costs are responsible for 95{b97d180a8a49f04872ef972912bfa9553acbb9c22aded732b394a1613ca7eaf9} of this squeeze on American’s pocketbook. Demand transparency, engage employees and reduce spend for a happy, more productive workforce.