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Amazon, Berkshire Hathaway And JP Morgan Health Care Partnership Fails

AILSA CHANG, HOST:

Amazon, Berkshire Hathaway and JPMorgan Chase created a splash three years ago when they announced a health care partnership. Haven, as the company was known, was meant to disrupt health care in the U.S. Well, it failed to do that. And just three years after promising to shake up the health insurance industry, Haven announced it is shutting down after February. So what went wrong? Well, joining us to help us understand that is Erin Brodwin. She's a health tech correspondent at Stat News.

Welcome.

ERIN BRODWIN: Thanks for having me.

CHANG: So Erin, just remind us - what exactly did Haven set out to do originally?

BRODWIN: That's a very good question. And I think a lot of folks would have different answers to that question - from the beginning was to, as you said, shake up the health insurance marketplace and cut costs for people. But those goals remained pretty vague throughout Haven's three-year existence. And I think ultimately, that was the cause of Haven's downfall.

CHANG: Well, beyond just sort of having hazy goals, what would you say also went wrong? What led to this really short lifespan for the partnership?

BRODWIN: One of the things that happens when you do have hazy goals at the beginning or a hazy or vague mission or vision is that you can't set smaller, piecemeal steps to execute on as you approach that larger goal. And as a result of that, Haven never really showed a lot of progress. It was very, very secretive from its earliest days, so a lot of people thought, you know, well, they're going to use tech. They're going to make health care services more understandable, easier to access. None of that really ever happened.

And then on top of that, you have kind of a flawed choice of CEO. Atul Gawande is a visionary, a Harvard professor, a surgeon, very well respected in a lot of circles. But what he isn't is an operator. So it was kind of no surprise to a lot of industry observers that Gawande didn't really succeed in leading or steering the Haven ship. And he stepped down back in May. And I think when that happened, a lot of people started to think, hmm (ph). There was also the issue of competition with some of its own founders.

CHANG: Yeah, let's talk about that. I mean, Amazon right now is a player in its own right in the health care world. Could a case be made that Amazon is actually the real winner here?

BRODWIN: Yeah, it certainly is. While Haven was kind of struggling to get off the ground, you saw Amazon launch what some people are calling kind of a parallel business unit called Amazon Care, and it's launched so many other initiatives. It is perhaps possible that, yeah, Amazon emerged a big winner here. And the biggest learnings from Haven have already been fed back into Amazon.

And, of course, you know, now Amazon has all of these efforts in health care happening. They've got Halo, a wearable health tracker. They've got a partnership with a startup called Crossover Health to build physical clinics for staff. And kind of the crown jewel on top of all those efforts, of course, is Amazon Pharmacy, which is already having some really big, disruptive effects in the industry. You've seen online pharmacy businesses like Ro and GoodRx already start to unveil some similar offerings designed to compete on Amazon's stage.

CHANG: And we should note that Amazon is among NPR's recent financial supporters. Erin Brodwin is a health tech correspondent at Stat News.

Thank you so much for your time today.

BRODWIN: Thanks so much for having me - really enjoyed it.

(SOUNDBITE OF L'ECLAIR'S "DALLAS") Transcript provided by NPR, Copyright NPR.

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