Amazon is notorious for reaching its big arm into a wide variety of industries.  Other than being the largest e-commerce company in the United States, Amazon also recently bought Whole Foods Market and is involved in cloud computing services.  Now, along with tech giant Apple, Amazon is getting into medical clinics.

Large companies, like Amazon, Apple, and Facebook, already employ third-party medical providers to give their employees access to high-quality health care.  Apple and Amazon see an opportunity to branch out on their own rather than rely on third-party providers.  As a result, they have both been making their own moves to establish those internal clinics.  Amazon will be launching a small clinic in the upcoming months which aims to serve a small number of their employees.  Their end goal is to see how the clinic works out and then continue to expand from there.  On the other hand, Apple has established its own subsidiary, AC Wellness, and is hiring like crazy to staff the health clinic.

Companies like Apple and Amazon are deciding to dive into the healthcare industry for a variety of reasons.  According to health experts, the primary reason is to control costs.  They believe that in order to actually help their employees pay less for health care, different medications, and unnecessary referrals, they need to take over the system.  In this way, the companies can more proactively manage their employees “patient lifestyle” by steering them to the corrects specialists and providing them with only the medications that they actually need.  According to Micah Weinberg, president of the Bay Area Council Economic Institute, “Employers generally have become extremely frustrated about the enormous expense of the healthcare system as well as the inconsistent, at best, quality experienced by their employees.”

In addition to decreasing costs, the companies are able to test new products if they own their own medical clinics.  Like Amazon with Whole Food, both Apple and Amazon realized that they can be a factor in the health sector and be leaders in change.  Primarily, both of these companies are looking at hardware and software products that could help serve the health industry.  As both companies are based around the principle of secrecy, being able to test them internally add lots of intrinsic value.  Nikhil Krishnan, a health-focused analyst with CB Insights, said “If Amazon and Apple had considered these clinics for internal use only, they would have likely outsourced to any of the numbers of clinics that offer on-site clinic services.  The fact that Apple and Amazon are testing it in-house means they want to test the model with employees, iterate and eventually release this product to their respective customers.”

At the same time, both companies are also looking to make more money.  To push that initiative and the other two, both have also made some acquisitions and taken on some partnerships.  Amazon bought PillPack.  PillPack is an internet pharmacy company which is leveraging the grocery delivery business of Whole Foods.  In addition, they are working with JP Morgan and Berkshire Hathaway to work to reduce health care costs.  Apple bought Gliimpse, a medical record technology start-up to help users get all their health information into one space.

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