The ways in which we watch TV, hail a taxi or book a vacation rental have changed. More to the point, they’ve been disrupted thanks to Netflix, Uber and Airbnb.
And now, Jeff Bezos, Warren Buffet and Jamie Dimon, intend to take the disruptor model to healthcare. In January, the three men joined forces to set up an independent healthcare company for their employees.
But can two financial powerhouses and an online retailer feasibly disrupt the healthcare industry? Theoretically speaking, no. Here’s why.
Clay Christensen, the founding father of disruption theory describes it as ‘solutions that are simpler, more affordable and more accessible‘.
For successful disruption, you must have all three, and this is why healthcare presents a challenge to its Wall St and Silicon Valley disruptors.
Healthcare is anything but simple. How we diagnose and treat illnesses is constantly evolving, and technologies like CRISPR and nanorobots are changing the essence of how doctors practice medicine (see here). Simplifying the toolkit actually flies in the face of the advancements needed to better serve our population.
A successful disruption strategy relies on price cuts in order to capture a non-consuming share of the market. But in healthcare, costs are tough to curb and many continue to deal with higher premiums (which have risen by 250% since 1999).
Ultimately, cost-cutting doesn’t translate well in healthcare because there is a premium attached to the best doctors. And unlike the goods and services we consume (TV, travel, and transport) we are not consumers of healthcare, we are patients of it. Our care cannot and should not be compromised through a disrupted low-cost model, whatever that may look like.
Accessing Netflix on your smartphone is one thing, but the point of consumption for medical treatment is another. Access to your doctor matters and most people prefer to deal with their regular physician. Having said that, efforts to change the culture are underway. Facetiming doctors (something I blogged about here) is a real thing, but it’s not scalable yet, and no bank or online retailer has the expertise and know-how to implement it successfully.
To date, details of the Amazon, Berkshire and JP Morgan merger remain under wraps, making it difficult to draw any meaningful conclusions. Their alliance does, however, demonstrate the growing frustration across American businesses with the current health care system, and they deserve credit for doing something about it.
But industry analysts remain skeptical. Two weeks ago I attended a healthcare lunch and learn session, where the lead speaker echoed what many in the sector think of the alliance …‘nice idea, good luck doing it…’
As always, pushing for health.
Photo credit: Andy Kropa/Invision/AP