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Three Business Titans To Tackle Health Care Costs

05 February 2018

The strong performance of the stock market combined with the out of control rising healthcare costs helped float all boats in the industry.

It will begin with their own employees - close to one million in the United States - but the trio has clear hopes for the model to eventually be available to the entire country. Jamie Dimon, CEO of JPMorgan Chase, said in a statement the effort could eventually be expanded to benefit all Americans.

It is interesting to note that one of the largest USA reinsurance companies, Gen Re, is at the core of Berkshire Hathaway's empire.

All three were strong proponents of President Obama's public healthcare program, dubbed Obamacare, before uniting to create an exclusive private provider system.

"To make it sound like there's some sort of prohibition on people getting access to treatments is a gross misrepresentation of reality", Bateman-House said. Our group does not come to this problem with answers. "Rather, we share the belief that putting our collective resources behind the country's best talent can, in time, check the rise in health costs while concurrently enhancing patient satisfaction and outcomes". The new health care company will be independent and not constrained by profit-making incentives, according to the release.

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Tackling the enormous challenges of healthcare and harnessing its full benefits are among the greatest issues facing society today.

Any solutions the soon-to-be-formed company devises would find a huge and receptive audience. It is unclear how extensively the three partners will overhaul their employees' existing health coverage, and whether they will use their muscle to negotiate lower prices for drugs and procedures.

Three of the largest and most influential companies in the US are teaming up to tackle the health care crisis in the U.S. Perhaps the companies would strike deals to offer employee discounts with service providers like medical testing facilities.

Change the incentives for the employee to be more careful (i.e., high deductible health plans) and help them save for routine needs through, for instance, health savings accounts. CVS also operates 1,100 health clinics within its stores, providing simpler services like treating colds and other minor ailments that don't merit an ER visit, and don't require the hassle of making an appointment with a regularly seen primary care physician.

The bottom line is that the USA spends almost twice as much on health care as a percentage of the economy as do other industrialized countries - while its people use about the same amount of health care. Small businesses have been under particular strain. According to the Kaiser Family Foundation, average premiums for family coverage for employees rose to $18,764 past year, a 19 percent rise since 2012.

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That's down from 66 percent more than a decade ago. Maybe someday there will be politicians courageous enough to start rebuilding US health care from scratch, with less bureaucracy, fewer intermediaries, less protectionism, more efficiency and fairer prices.

The ACA also required all individuals to have some form of insurance - through their employer, privately purchased, or through Medicaid - or pay a tax penalty, but that dictate was repealed with the passage of the new tax reforms in December.

Paired with the sheer resources of JPMorgan Chase, America's multinational banking and financial services company, and Berkshire Hathaway, the holding company made famous in part by Warren Buffett's leadership, it certainly seems that this health care initiative could have legs. It ranks 30th in the world on "basic physical and mental health, health infrastructure and preventative care", according to last year's Legatum Prosperity Index. Common stock of the company is listed on the New York Stock Exchange, trading symbols BRK.A and BRK.B.

To me, it says that our legislators should be embarrassed that they can't get their act together to come up with some sort of insurance coverage for everyone. "The sky's the limit on where they could possibly go with this", remarks Brian Marcotte of National Business Group on Health in an interview with AP.

Berkshire Hathaway is an Omaha-based conglomerate employing approximately 367,700 employees across a variety of industries including insurance, candy manufacturing, electric utilities, newspapers, fractional jet ownership, ice cream, bricks and furniture. He is also an advocate of more, not less, competition.

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"We know that 5 percent of any population consumes 50 percent of the health care dollar". KHN asked a variety of health policy experts their thoughts on this venture, and what advice they would offer these CEOs as they go forward.

Three Business Titans To Tackle Health Care Costs