The statement from Amazon, JP Morgan Chase, and Berkshire Hathaway announcing their new joint healthcare venture as "an independent company that is free from profit-making incentives and constraints" made me chuckle.
There's a view that "profit-making incentives" are a problem with American health care. But if Jeff Bezos, Jamie Dimon, and Warren Buffett really think that "profit-making incentives" are so harmful, they've sure chosen odd careers as leaders of for-profit companies. In fact their entire venture is a demonstration of how "profit-making incentives" can actually at least potentially be helpful in health care. Buffett says he wants to "check the rise in health costs." One reason he is motivated to do that is surely that those costs, borne by employers, cut into profits.
People who say "profit-making incentives" are problems in health care point to high compensation for physicians and for hospital, health insurance, and pharmaceutical company executives. They also point to unnecessary procedures, and to expensive sticker prices for some prescription drugs or electronic health records systems. But all of these things are also present in government-owned and non-profit health care systems.
Profit-making incentives sometimes wind up driving down prices for consumers. Think of $2 or $3 generic drugs from the pharmacies of chain retailers like Target. If Amazon, JP Morgan Chase, and Berkshire Hathaway really can figure out ways to keep their employee populations in better health for less money, they'll be creating something of value. Why shouldn't they expect to be rewarded for it with profits?
I understand, and doctors understand, that what's best for an individual patient can sometimes conflict with what's best for the bottom line of the entity financially responsible for paying that individual patient's medical bills. But maybe part of the answer on health care isn't eliminating profit-making incentives, but rather aligning them better?