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Summary
- Haven, the JV between Amazon, JPMorgan and Berkshire Hathaway, is set to cease operations by the end of February 2021.
- The alliance was created to offer solutions for reducing the US healthcare cost, which is nearly four times compared to other developed countries.
In what is being deemed as a major setback for the health sector, the high-profile joint venture between Amazon, JPMorgan and Berkshire Hathaway has come to an end without achieving its objectives. The joint venture fiasco is reportedly being attributed to the manner of execution of projects as each partner followed a separate path.
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The joint venture between these most influential American companies was aimed to provide better services at a reduced cost. It was a promising partnership formed three years back when the CEOs of these prominent companies decided to work towards the pertaining issue of rising costs in the American healthcare system.
Back then in 2018, the joint venture announcement had shaken the healthcare market, and the shares of many healthcare-related firms had tumbled.
The decision to disband the partnership highlights how challenging it is to make changes to the American healthcare system.
Over the three-year period, Haven explored various solutions to reduce the cost around primary care and make prescription drugs more affordable. Additionally, it worked towards making the complicated insurance benefits easier to use and understand. However, it is expected to cease its operations by the end of February 2021.
Reportedly, most of Haven's employees will work in either of the three partner companies. Also, there are reports that the founding firms would implement the ideas from the Haven project to boost the healthcare offering for their employees.
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COVID-19 was too much for the already complicated US healthcare system
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The US healthcare system is known for its complexities due to multiple factors like ideological differences on how the healthcare system should run. Healthcare has always been at the centre of the debate by rival parties.
The system is dependent on a myriad of things, including out-of-pocket costs for employer-based insurance, separate rules, enrollment dates and funding. Also, there is a shortage of health workers, including physicians and nurses.
The pandemic led to a healthcare emergency that has put enormous pressure on the system to reduce costs of providing access to better medical services. The healthcare providers in the US need to fulfill many usage and billing requirements from various payers. The system hires costly administrative help to complete these formalities, thus wasting a lot of money on the administrative services.
Also read: 5 Things to Consider While Going for Private Healthcare Insurance
In America, drugs and healthcare prices are dependent directly on market forces. The hospitals, nurses, and doctors charge a hefty price here, and the citizens pay nearly four times for the drugs compared to other developed countries.
Also Read: WHO warns coronavirus can become endemic; a wake-up call for 2021?
