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Amazon Care's nationwide telehealth expansion 'may be bigger than the sum of the parts,' says firm

Lessons learned from the folding of Haven may inform the retail giant's approach in this latest venture.

Jeff Lagasse, Associate Editor

(Photo by Aekkarak Thongjiew/EyeEm/Getty Images)(Photo by Aekkarak Thongjiew/EyeEm/Getty Images)

Amazon signaled its intention this week to expand its Amazon Care app-based telehealth services to its employees and to other companies across the U.S. – services that to date have only been available to the retail giant's Washington-based workforce.

This prompted reaction from an Illinois-based consulting firm, which said the end result "may turn out to be bigger than the sum of the parts."

Amazon's announcement on Wednesday confirmed months of rumors that Amazon Care would be making an expansion effort, and as part of that push its services would be available to other Washington-based companies starting this week and to other companies nationwide this summer.

Amazon Care also offers in-person services, which will be expanded to Washington, Baltimore and other cities in the coming months.

At this point, the costs of video care, care chat and mobile-care services are subsidized by Amazon for employees and their dependents, and there is no cost to enroll in Amazon Care. In-home visits incur a fee. 


Paddy Padmanabhan, founder and CEO of Damo Consulting, a growth strategy and digital transformation advisory firm that works with healthcare enterprises and global technology companies, said the effort deviates from previous initiatives in one critical respect: Amazon Care threads together a number of disparate healthcare initiatives into one offering.

Padmanabhan pointed to Amazon's history of making small acquisitions and essentially using them as a crucible for experimentation, specifically pointing to the Pillpack pharma distribution business and the Care Medical physician practice. 

In 2018, Amazon acquired virtual pharmacy PillPack for about $1 billion, marking its expansion into prescription medication. PillPack delivers medications in pre-sorted dose packaging, coordinates refills and renewals and ensures that shipments are sent on time.

The service targets people who take multiple daily prescriptions. Care Medical, meanwhile, contracts with Amazon Care to provide healthcare services.

Not all of Amazon's forays have gone as smoothly. Haven, a healthcare company formed three years ago by finance and tech giants Amazon, Berkshire-Hathaway and JPMorgan Chase, ended its independent operations in February.

Ultimately, nothing substantial emerged from the collaboration except for a few pilot programs, such as one announced in November 2019 and offered to about 30,000 JP Morgan Chase employees in Ohio and Arizona. Under the program, the workers would have the choice of two health plans for 2020 to be run by Cigna and Aetna.

Padmanabhan called the Haven situation a "debacle," but said it may have provided some lessons on the mechanics of primary care that Amazon has used to refine the Amazon Care offering.

"What will Amazon's entry into virtual care mean for other telehealth players such as Teladoc? We have to approach the healthcare market with an abundance mindset," said Padmanabhan.

"The $3 trillion U.S healthcare market has plenty of room for innovators and incumbents. There isn't going to be just one winner, and the overall market may even expand to accommodate new products and services. Competition and innovation will result in lower costs and improved quality of care."

Last year, Teledoc bought Livongo, whose principles unveiled Transcarent, a company which also promotes the reimagining of healthcare through digital innovation. CEO Greg Tullman wants to overhaul employer-sponsored healthcare for a better quality of care and affordability, which also has echoes of Haven's mission. 

It's not yet clear how Amazon Care will work in conjunction with health insurance if it's provided by other companies. Currently, the services are not billed to health insurance or count toward a user's deductible.

Right now, the costs of video care, care chat and mobile care services are subsidized by Amazon for employees and their dependents, and there's no cost to enroll in Amazon Care. In-home visits incur a fee.

"In the emerging era of healthcare consumerism, the ones who succeed though will have good customer feedback loops, listen carefully to what customers need and want, and build their technology-led offerings to deliver superior customer experiences," Padmanabhan said.


Amazon will be joining with other telehealth apps that are muscling their way onto the national stage. Digital retail pharmacy NowRx recently announced it would be expanding into telehealth beginning with pre-exposure prophylaxis.

Those offering telehealth in multiple states will likely have to contend with changing regulations around virtual care as the COVID-19 pandemic begins to slowly abate.

Twitter: @JELagasse
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Healthcare Everywhere, Every Day

The onset of the COVID-19 crisis a year ago, with its widespread quarantines and lockdowns, offered telemedicine its moment to shine after years of under-fulfilled promise. As states look toward a post-pandemic world it's time to build on that promise.