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235        <h1 class="single-title">Amazon&#x27;s Radical Plan For Healthcare: À La Carte Pricing</h1>
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241        <p>Amazon's Radical Plan For Healthcare: À La Carte Pricing unknown</p><h2 id="with-amazon-clinic-patients-can-see-wait-times-and-pricing-upfront-but-there-are-limits-to-what-even-the-world%E2%80%99s-biggest-retailer-can-do-to-make-a-dent-in-the-43-trillion-the-us-spends-on-healthcare">With Amazon Clinic, patients can see wait times and pricing upfront, but there are limits to what even the world’s biggest retailer can do to make a dent in the $4.3 trillion the U.S. spends on healthcare.</h2><p><sub>By </sub><a href="https://www.forbes.com/sites/katiejennings/?ref=marco.health"><sub>Katie Jennings</sub></a><sub>, Forbes Staff</sub></p><hr><p>W<strong>hen ordering a hamburger</strong> at a restaurant, you know how much it’s going to cost before you start eating. When going to the doctor in the United States, it could be weeks or months before you know how much that office visit is going to set you back (not including any additional lab work, imaging or medication). The fragmented payment system – built on negotiations between doctors, insurers, employers and the federal government – means patients could be billed vastly different amounts for the same visit. “There's no such thing as a price,” says Ezekiel Emanuel, an oncologist and co-director of the Health Transformation Institute at the University of Pennsylvania. “That's one of the fundamental issues in healthcare.”</p><p>With Amazon Clinic, one of the world’s biggest technology companies is looking to infuse the black box of healthcare pricing with some actual transparency. Login to the site and you’ll see that a person who tests positive for Covid-19 in Wyoming can pay $35 for a message-based conversation with a doctor, who will respond within an hour and 45 minutes. Or $40 to get a response in 30 minutes. A video visit costs $74 with a wait time of around an hour and 30 minutes.</p><p>Nworah Ayogu, chief medical officer and general manager of Amazon ClinicCourtesy Amazon</p><p>Amazon isn’t directly providing the medical services. Instead, the tech giant has contracted with four different startups to provide message and video appointments for around 30 medical conditions. The result is a dynamic marketplace where customers can see pricing, wait times and the typical number of prescription refills upfront. “If you want the lower cost provider, you can choose that. If you are actually prioritizing the speed at which someone is getting back to you, you can prioritize that as well,” Nworah Ayogu, chief medical officer and general manager of Amazon Clinic tells <em>Forbes</em>. “We think really being able to surface different options for different customers lets them choose what's important to them.”</p><p>Amazon Clinic first launched in November 2022, offering message-based care in 32 states. Patients could complete an intake questionnaire and receive a message back from a doctor. In the industry, this is what’s known as asynchronous care – the doctor and the patient aren’t communicating with each other in real-time. Earlier this month, Amazon Clinic <a href="https://www.aboutamazon.com/news/retail/amazon-clinic-available-nationwide?ref=marco.health" rel="nofollow noopener noreferrer">announced</a> it was expanding to all 50 states. That means asynchronous care in 34 states (where Amazon has determined it’s legally allowed) and real-time video visits in all 50 states plus D.C.</p><p>Ayogu declined to provide specific numbers on the growth of Amazon Clinic’s services since launch, other than to say that he was “surprised by the amount of customer demand,” which is what motivated the national expansion. He acknowledged pricing and wait times were changing but didn’t specify how frequently. None of the vendors would reveal their pricing strategies or how many patients they’re treating. <em>Forbes </em>observed changes in wait times over a 24-hour period. As of early August, message-based visits generally seemed to range from $30 to $45, while video visits ran from $74 up to $95, depending on the condition.</p><p>“Amazon is basically exploiting unmet patient and provider needs,” says Ge Bai, a professor of accounting and health policy at Johns Hopkins University. “That’s what they do best.” Bai says patients are willing to pay different prices for services based on what’s important to them, and, likewise, healthcare companies are willing to offer different pricing based on what patients want. However, the rigidity of the health insurance system doesn’t typically allow for this kind of flexibility. “Convenience or quality is not being priced in the current system,” she says.</p><p>Even with Amazon’s scale, displaying prices for a few dozen types of medical visits is just a drop in the bucket of the $4.3 trillion the U.S. spends on healthcare costs annually. And the consultation is only one part of the equation, says Emanuel. Amazon Clinic patients still don't know the cost of medications or testing the doctor might prescribe during the visit. Plus, it’s cash pay – for now at least – meaning patients can’t use their insurance. "It's not going to move the healthcare needle,” says Emanuel. “I think this is fact-finding – more of a kind of research project than an honest business. Amazon does a lot of that. It tests how people respond, then modifies.”</p><hr><p>A<strong>mazon has launched many</strong> different healthcare efforts over the years. Some projects have endured, like the $753 million acquisition of online pharmacy PillPack, which is now part of Amazon Pharmacy. Others have fizzled out, like Haven, the joint venture between Amazon, Berkshire Hathaway and JPMorgan Chase to lower employee healthcare costs. Amazon’s attempts at directly delivering medical services have also been a mixed bag. In 2019, Amazon launched Amazon Care, which started as virtual services for its own employees, and morphed into a hybrid offering with in-person clinics for c
241orporate customers. In July 2022, Amazon announced plans to acquire One Medical, which also offered in-person and virtual care, for $3.9 billion. A month later, <a href="https://www.geekwire.com/2022/internal-memo-amazon-care-to-shut-down-not-a-complete-enough-offering-for-corporate-customers/?ref=marco.health" rel="nofollow noopener noreferrer">GeekWire reported</a> Amazon Care would shut down by the end of 2022. Amazon Clinic launched that November.</p><p>Amazon Health Services, which falls under the leadership of Neil Lindsay (who previously oversaw Amazon Prime), now includes three business units: One Medical, Amazon Pharmacy and Amazon Clinic. With Amazon Clinic, the company is taking a different route than it did with Amazon Care: rather than providing medical services, it’s outsourcing to four digital health startups. Hello Alpha and Curai Health, both based in Palo Alto, offer asynchronous care. Austin, Texas-based Wheel and St. Louis, Missouri-based SteadyMD offer both asynchronous and real-time care. (The original launch included another startup called HealthTap, which no longer appears on the Clinic. The Mountain Vie
241w-based startup’s CEO Sean Mehra says that’s because it was a licensing deal where HealthTap appeared as the consumer-facing brand, while Wheel was providing the backend services.)</p><h3 id="the-startups-behind-amazon-clinic-curai-health"><strong>The Startups Behind Amazon Clinic: Curai Health</strong></h3><h4 id="with-curai-health-cofounder-and-ceo-neal-khosla-has-been-building-artificial-intelligence-tools-to-help-doctors-speed-up-tasks-including-an-intake-chatbot-since-founding-the-palo-alto-based-startup-in-2017-this-year-khosla-says-the-company-which-has-raised-57-million-in-funding-switched-to-a-large-language-model-for-automatic-note-taking-software-that-change-cut-the-amount-of-time-it-took-providers-to-write-assessments-by-75-%E2%80%9Ca-step-function-improvement-in-technology-leads-to-much-more-efficiency%E2%80%9D-says-khosla">With Curai Health, cofounder and CEO Neal Khosla has been building artificial intelligence tools to help doctors speed up tasks, including an intake chatbot, since founding the Palo Alto-based startup in 2017. This year, Khosla says the company, which has raised $57 million in funding, switched to a large language model for automatic note-taking software. That change cut the amount of time it took providers to write assessments by 75%. “A step function improvement in technology leads to much more efficiency,” says Khosla.</h4><p>When asked how the vendors were selected, Ayogu, an internal medicine doctor who has mainly seen patients in-person, says “your web-side manner is different than your bedside manner.” Accordingly, he says Amazon’s focus was on companies that “really understand how to deliver care virtually in a very customer-obsessed way.”</p><p>When the pandemic hit, one of the big challenges for delivering virtual care was complying with all of the different rules and regulations in each state. Certain states require video or phone call visits and don’t allow asynchronous care. Some states require both the patient and the healthcare provider to reside in the same state. Other states allow providers to be licensed across multiple states. SteadyMD and Wheel have built up clinician networks in all 50 states and D.C. that power the virtual clinics of other brands and healthcare companies, which means they often play more of a behind-the-scenes role. The idea is to help other companies be able to match supply and demand, says Guy Friedman, cofounder and CEO of SteadyMD. It’s one of the most basic economic principles, but one of the hardest to execute nationwide. “Every single digital health company has the same problem,” says Friedman. “You don't know where the spikes are going to come from and at what times, so you have to be ready. That's really expensive and hard to do.”</p><h3 id="the-startups-behind-amazon-clinic-wheel"><strong>The Startups Behind Amazon Clinic: Wheel</strong></h3><h4 id="michelle-davey-cofounder-and-ceo-of-austin-texas-based-wheel-says-the-startup-has-always-operated-behind-the-scenes-since-its-founding-in-2018-wheel-which-has-raised-216-million-powers-the-national-telehealth-offerings-of-other-brands-with-its-software-and-247-clinician-network-amazon-clinic-is-the-first-place-where-consumers-will-see-wheel-front-and-center-though-davey-stresses-this-doesn%E2%80%99t-mean-wheel-is-getting-into-the-direct-to-consumer-business-she%E2%80%99s-still-focused-on-selling-to-businesses-not-individuals">Michelle Davey, cofounder and CEO of Austin, Texas-based Wheel, says the startup has always operated behind-the-scenes since its founding in 2018. Wheel, which has raised $216 million, powers the national telehealth offerings of other brands with its software and 24/7 clinician network. Amazon Clinic is the first place where consumers will see Wheel front-and-center, though Davey stresses this doesn’t mean Wheel is getting into the direct-to-consumer business: she’s still focused on selling to businesses, not individuals.</h4><p>On Amazon Clinic, SteadyMD and Wheel offering messaging and video visits in all 50 states plus D.C. SteadyMD offers video from 7 a.m. to 1 a.m. ET, while Wheel offers video 24/7. (Friedman declined to comment as to why SteadyMD doesn’t offer 24-hour video.) There are some variations in pricing. For example, Wheel prices a video visit for emergency contraception in California at $74, while a visit for genital wart treatment is $77 and a skin condition is $95. “We really look at it on our side of what does it take to deliver that high quality care, 24/7, 365?” says Wheel cofounder and CEO Michelle Davey, when asked about how the company thinks about pricing in Amazon’s marketplace. “And it's not just the clinicians, but also all of the support that goes along with it, and the technology as well.”</p><p>Message-based visits seem to range from around $30 to $45 depending on the condition. Hello Alpha is specifically focused on women’s health. Curai, which focu
241ses on primary care and has built artificial intelligence models to help its clinicians with decision support, tends to have some of the fastest response times.</p><h3 id="the-startups-behind-amazon-clinic-steadymd"><strong>The Startups Behind Amazon Clinic: SteadyMD</strong></h3><h4 id="founded-in-2016-st-louis-missouri-based-steadymd-started-out-by-offering-virtual-primary-care-services-but-after-navigating-the-complexity-of-hiring-doctors-to-work-in-all-50-states-and-dc-cofounder-and-ceo-guy-friedman-says-the-company-decided-to-pivot-in-2020-the-new-direction-renting-out-steadymd%E2%80%99s-clinician-network-to-other-digital-health-companies-trying-to-scale-their-own-telehealth-services-%E2%80%9Cit-exploded-almost-immediately%E2%80%9D-says-friedman-steadymd-has-raised-around-60-million">Founded in 2016, St. Louis, Missouri-based SteadyMD started out by offering virtual primary care services. But after navigating the complexity of hiring doctors to work in all 50 states and D.C., cofounder and CEO Guy Friedman says the company decided to pivot in 2020. The new direction: renting out SteadyMD’s clinician network to other digital health companies trying to scale their own telehealth services. “It exploded almost immediately,” says Friedman. SteadyMD has raised around $60 million.</h4><p>Given Amazon’s history of acquisition in this space, it is possible that part of its strategy is to test out vendors in preparation for a future acquisition. Ayogu declined to speculate. He also wouldn’t say whether there would eventually be integrations with One Medical. “I think there are a lot of interesting ways in which we could collaborate in the future. But it'll really be driven by what we think will serve customers' needs most effectively.”</p><p>As Amazon continues to expand in healthcare, politicians have raised concerns about how the e-commerce giant might use or share people’s health information with other Amazon entities. U.S. Senators Elizabeth Warren of Massachusetts and Peter Welch of Vermont, both Democrats, <a href="https://www.welch.senate.gov/wp-content/uploads/2023/06/20230615_Amazonclinceoversight_letterFinalSigned.pdf?ref=marco.health" rel="nofollow noopener noreferrer">sent a letter</a> to Amazon CEO Andy Jassy in June asking about what consumer data Amazon Clinic is collecting and how it’s being used. Ayogu says there’s no data sharing between Amazon Clinic and the rest of Amazon. “It's a walled garden,” he says. “Your health information stays completely separate from your kind of information on the consumer side of Amazon.”</p><hr><p><strong>T</strong></p><p><strong>he reason why Amazon Clinic</strong> is such an interesting experiment is because one of the big takeaways from research into healthcare price transparency initiatives is that information alone is not enough to make it happen. When hospitals, employers or insurers offer price transparency tools, they are only used by a very small subset of patients, says Christopher Whaley, an economist at RAND Corporation and professor of health policy at Brown University. That’s often because patients aren’t on the hook for their total healthcare costs. Right now, though, that’s not the case for Amazon. “Where everything's outside of insurance, then any savings from shopping go directly back to the patient,” says Whaley. “This is a much stronger incentive to care about prices.”</p><p>Gloria Lau, cofounder and CEO of Hello Alpha, says she hopes that customers will not only consider cost and timing for services, but will also take quality into account. “As a consumer, I don't want to just look at what's the cheapest and fastest,” she says. “I want to know, do you treat me well? Did my issue get resolved? Am I getting healthier?”</p><h3 id="the-startups-behind-amazon-clinic-hello-alpha"><strong>The Startups Behind Amazon Clinic: Hello Alpha</strong></h3><h4 id="ceo-gloria-lau-founded-palo-alto-based-hello-alpha-in-2017-offering-a-message-based-primary-care-service-for-women-the-startup-which-has-raised-35-million-now-offers-care-in-49-states-and-dc-and-has-started-selling-services-to-employers-including-obesity-care-and-access-to-the-weight-loss-drugs-known-as-glp-1s-lau-says-hello-alpha-goes-live-in-indiana-%E2%80%93-its-50th-state-%E2%80%93-this-month">CEO Gloria Lau founded Palo Alto-based Hello Alpha in 2017 offering a message-based primary care service for women. The startup, which has raised $35 million, now offers care in 49 states and D.C. and has started selling services to employers, including obesity care and access to the weight loss drugs known as GLP-1s. Lau says Hello Alpha goes live in Indiana – its 50th state – this month.</h4><p>With vendors able to see each other’s prices, there’s a question of if undercutting each other on price could also affect quality. Whaley says he’s not concerned about a race to the bottom. On the contrary, he thinks price competition would actually be welcome in the healthcare market. But one of the biggest issues to scaling Amazon’s model, he says, is that the majority of people in the U.S. use some kind of insurance to access healthcare, whether it’s private or government-funded.</p><p>Ayogu hints that accepting insurance could be in Amazon Clinic’s future. “Do I think that having insurance is another way to make things even more affordable? I agree completely,” he says. He also suggests that Amazon Clinic is working through the regulatory complexity around Medicare and Medicaid patients. “That is complexity that I want us to be able to unravel,” says Ayogu. “We absolutely want to serve those customers, because there's a lot of need there.”</p><h2></h2>
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565    window.addEventListener("DOMContentLoaded", function() {
566        if (typeof NRWebReader != 'undefined') {
567            window['NRWebReader'] = new NRWebReader({
568            widget_id: "rzbu11e9gt"  // DO NOT REMOVE. This is your widget ID for your WebReader
569            });
570        }
571    }); 
572</script>
572
573
574<!-- Start of LiveChat (www.livechat.com) code -->
575<script>
576    window.__lc = window.__lc || {};
577    window.__lc.license = 16677726;
578    ;(function(n,t,c){function i(n){return e._h?e._h.apply(null,n):e._q.push(n)}var e={_q:[],_h:null,_v:"2.0",on:function(){i(["on",c.call(arguments)])},once:function(){i(["once",c.call(arguments)])},off:function(){i(["off",c.call(arguments)])},get:function(){if(!e._h)throw new Error("[LiveChatWidget] You can't use getters before load.");return i(["get",c.call(arguments)])},call:function(){i(["call",c.call(arguments)])},init:function(){var n=t.createElement("script");n.async=!0,n.type="text/javascript",n.src="https://cdn.livechatinc.com/tracking.js",t.head.appendChild(n)}};!n.__lc.asyncInit&&e.init(),n.LiveChatWidget=n.LiveChatWidget||e}(window,document,[].slice))
579</script>
579
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581<!-- End of LiveChat code -->
582
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584</html>

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