by Barbara Casey, CRO
On the heels of its quasi-national holiday, Prime Days, Amazon announced on Tuesday, July 26 that it is buying One Medical, a membership-based primary care practice with over 200 locations, for nearly $4 billion.
Amazon, who has been flirting with healthcare for some time, is now making its presence felt with brick and mortar primary care locations. The digital giant is putting a stake in the ground and how this will ultimately look is to be determined.
In 2018, Amazon purchased PillPack, launching Amazon Pharmacy as a prescription and delivery service and scaled Amazon Care, a texting and video service (telehealth) from Amazon employees to a nationwide program earlier this year.
While Amazon Care is primarily focused on employer-led plans, Amazon knows no boundaries as consumers become more and more comfortable with retail-style service and customer-focused healthcare.
So, what does this mean for today’s hospitals and other healthcare organizations? Is this the beginning of the end for traditional healthcare providers and organizations?
Not so fast. When a player such as Amazon comes along, you can bet there’s a long-term strategy in place and while One Medical does provide Amazon with new resources, physicians and doctor’s offices, they’re still going to need larger healthcare centers, hospitals, imaging, outpatient rehabilitation and so on. Essentially, they need you.
The answer, according to our Chief Revenue Officer, Barbara Casey, is to lean in. Don’t be afraid to approach them. Partner. Make inroads. Consider this venture an addition to the market rather than a replacement or an unknown to be feared.
If One Medical is in your market, reach out and be the first to contact them and offer your services. Amazon has a lot to learn about healthcare delivery. Whole Foods was one thing but grocery stores and healthcare are not in the same ballpark when it comes to the intricacies of delivery.
Pharmacy giant CVS is on a similar path as they make plans to buy a primary care company by the end of the year. Due to their geographic footprint, this takes primary care for consumers and patients to a whole new level. “We can’t be in primary care without M&A,” CEO, Karen Lynch said during CVS’ second quarter earnings call on August 3. With CVS’ connection to Aetna members, this primary care footprint will help them establish a true medical home.
Therefore, primary care is more and more being disrupted by these aggregated players and it still means they’ll need a place to refer patients to. A place to have images taken, an emergency department, orthopedics, cancer care, and surgeries. The list is long and existing healthcare providers already provide these services so another player in the game shouldn’t be something to run from but something to embrace and work with.
Healthcare can be a challenging space. It’s unique in that change and improvement is a constant churn and transformation will never stop. There are always more and new entries into the ring. Amazon and One Medical will bring more muscle, money and know-how to the industry than most. It’s a brilliant move on their part. This puts them on the map but remember, they’ll need you, the health systems, and if patients want to use their services they’ll need you too so lean in, as they say, and let the chips fall where they may.