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Healthcare Business Today, US: Cognizant Healthcare Leaders Discuss Amazon's Impact on the Healthcare Industry

“Even if the Amazon venture were somehow sidetracked, the trends behind it—value-based care, consumer and employer rebellion over high premium and care prices—will continue to drive new industry models,” write Bill Shea and Trish Birch. “Traditional players must figure out where they will fit into a compressed industry value chain.” Excerpts:

“Amazon, JPMorgan Chase and Berkshire Hathaway joining forces to create a new healthcare entity may seem like an odd partnership.  Yet that triumvirate, plus Cigna’s planned acquisition of ExpressScripts, signal the continued tightening of the healthcare industry’s value chain. These developments also point to the rapid shifts in the industry’s business models—shifts that will upend traditional industry value propositions.

Drawing on industry research and client visioning exercises, we have identified several emerging healthcare business models being driven by ubiquitous smart phones, the Internet of Things, data analytics, and platform technology. The new models also are being shaped by consumers who now expect anytime, anywhere service and the industry’s shift to value-based care.

Amazon, Chase and Berkshire blend several of these new business models into one package. At each step, the new company would be tightening the industry value chain, squeezing out entities that increase costs without adding value.

The healthcare industry’s size, complexity and regulatory requirements will not inoculate it from mass disintermediation from a force like Amazon. The no-regrets moves above will make your organization stronger today as well as prepare it to transition to a new role in the industry’s evolving value chain in which the “Amazon of healthcare” may in fact turn out to be – Amazon.”

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