Can Apple, Amazon really disrupt healthcare costs?

Apple is opening its own healthcare clinics to serve its employees. Amazon is forming a nonprofit venture to lower healthcare costs for its workers. Could large companies be primed to disrupt an expensive market?

The tech giants aim to get around high healthcare costs by proving the service themselves. But Julie Rovner with Kaiser Health News does not share that optimism.

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“The big costs are in specialty drugs and hospital care,” Rovner told KIRO Radio’s Dave Ross. “The big dollar costs don’t come from having a nurse practitioner doing a strep throat test or doing a blood draw, which is essentially what most of these clinics do. There is still a lot to do on the cost side.”

Rovner admits there are issues such as waste in the healthcare system, but those do not account for the big picture, high costs of care.

“The reason the US spends so much more on healthcare than other countries is because of the prices that we pay,” she said. “It’s not the amount of care that we use, or the amount we waste.”

Company healthcare: It’s been done

Rovner also points out that companies providing health services is not new.

“Large companies have always been self-insured … they usually hire an insurance company that basically does the paperwork,” Rovner said. “A lot of people don’t know they don’t actually have ‘insurance’ because they get paperwork from an insurance company, but it’s actually the employer that’s footing the whole bill.”

“The question is if they want to take over that administrative job the insurance company has done,” she said. “Some might. We seem to be tilting back more toward employer-provided healthcare as opposed to employer-provided insurance; where we have more on-the-job clinics. Then people don’t have to leave work to get medical care … we’ve seen this before, it goes back and forth. We are just seeing it a little more now.”

Hear Dave’s full conversation with Julie Rovner here.

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