It seems the company never misses on its path to complete domination: buying Whole Foods, launching a successful streaming service, creating Amazon Alexa’s ubiquitous presence, acquiring iRobot in August – and much more.
So as Amazon has steadily pursued expanding its Amazon Care initiative, most were certain it was a sure success. With virtually endless resources and access to the industry’s brightest talent, Amazon was poised to revolutionize the U.S. healthcare system. However, the past few weeks have been a rollercoaster for the retail titan’s medical ambitions.
Key Events Leading in Amazon Care’s Timeline
The retailer launched Amazon Care in 2019 as a pilot program for its Seattle team members, offering virtual health services for employees and their families. In 2020 and 2021, Amazon continued to expand its offering across more U.S. cities and made key talent acquisitions to bolster its initiative.
As its program grew to more cities, Amazon then expanded by offering primary care services, covering 115,000 people through its “Neighborhood Health Centers.”
The company’s plan for 2022 was to continue this growth trajectory in more cities and with key acquisitions, as evidenced by Amazon’s purchase of One Medical for $4 billion in July.
Despite making moves to continue its expansion of primary care, Amazon recently announced it would be shuttering Amazon Care.
Around 400 people will lose their jobs or be transitioned into a new internal role as a result, reported The Seattle Times. In a series of blows, the FTC also announced it is investigating Amazon’s acquisition of One Medical, with the potential to block the deal.
Amazon is no stranger to failed healthcare endeavors. In 2021, its joint venture with JP Morgan and Berkshire Hathaway, Haven Healthcare, was dissolved after just three years.
What This Means
Although Amazon Care will be a thing of the past come 2023, this isn’t the end of Amazon’s healthcare pursuits, rather more likely a pivot and evolution to its overall strategy.
In 2018, Amazon made its first notable healthcare move: buying online pharmacy PillPack for $753 million. Industry reports indicate the retailer will be refocusing on pharmaceuticals once again in 2023, partnering with companies in Japan to deliver prescriptions.
Amazon Care’s demise may also reveal a couple key trends: (1) the difficulty in competing against the major healthcare players like CVS, who recently beat-out Amazon in a deal to purchase Signify Health, and, (2) the overall decline in telehealth demand.
Amazon’s stated reason for shutting down its virtual healthcare services offered through Amazon Care was that it “wasn’t a sustainable, long-term solution for its enterprise customers,” according to Fierce Healthcare. National data shows telehealth utilization has decreased month-over-month in 2022, as COVID-19 diagnoses wane and more patients seek in-person care.