For more than a year, it had no name other than “ABC,” the first letters of each company’s name. Now, more than a year later, the endeavor has an official name, Haven.
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In January 2018, Berkshire Hathaway’s Warren Buffett, Amazon’s Jeff Bezos and JP Morgan Chase’s Jamie Dimon announced they were creating a joint venture to slash healthcare costs and improve services. For more than a year, it had no name other than “ABC,” the first letters of each company’s name. Now, more than a year later, the endeavor has an official name, Haven.
The three moguls formed the company with the idea of improving healthcare access and lowering costs for their combined companies’ 1.2 million employees and families in the U.S. How that’s going to be accomplished, and whether what it does will be applicable to broader U.S. healthcare, remains unknown.
In June 2018, Atul Gawande came on as the chief executive officer of the joint venture. Gawande practices general and endocrine surgery at Brigham and Women’s Hospital and is a professor at the Harvard T.H. ChFan School of Public Health and Harvard Medical School. He is also founding executive director of Ariadne Labs, a health systems innovation center.
Haven recently launched a website. On the home page, Gawande writes that Buffett, Bezos and Dimon “believe that we can do better, and in taking this step to form this new organization, they have committed to being a part of the solution. We know that this work will take time, and we’ll need the help of others, but we will tackle problems step-by-step and make sure that patients remain our top priority.”
Haven’s three guiding principles are 1) being an advocate for the patient and an ally with anyone, including physicians, industry leaders, innovators and policymakers, who can improve patient care and contain costs, 2) create new solutions by changing “systems, technologies, contracts, policy” and anything else they can come up with, and 3) they will be relentless.
The website is long on promises and very short on specifics. It does indicate it doesn’t plan to replace the employees’ existing doctors or insurance companies, and under the, “How is Haven going to improve health care?” section, it says, “We are pursuing a number of common-sense fixes, as well as innovative approaches, to address issues like making primary care easier to access, insurance benefits simpler to understand and easier to use, and prescription drugs more affordable. We are also looking at new ways to use data and technology to make the overall health care system better.”
That really doesn’t tell customers or anyone else much of anything. Bloomberg suggests that in addition to generating excitement in the healthcare industry, “It has also raised fears among health insurers, drugmakers and other parts of the industry that the giant companies backing Haven would use their collective power to disrupt established players.”
Certainly, Amazon disrupts just about every industry it touches. One potential disruption, and one can only assume Haven will take advantage of it, is Amazon’s acquisition of PillPack last summer. PillPack is an online pharmacy, and the company is looking to pick up licenses that would allow it to operate in more states than it had at the time of the acquisition.
In December 2018, Jefferies analyst Brian Tanquilut wrote, “Our proprietary check of (Amazon’s) moves in the pharmacy space indicates that the online retailer has finally made moves to expand PillPack, though the initial expansion phase appears focused on offering pharmacy services to Amazon employees in Washington.”
At that time, it had picked up a license in Washington state and had two pending applications in New Mexico and Indiana. PillPack had five mail-order prescription facilities, which is much smaller than the 26 by Caremark, 18 from Optum, and 15 by Express Scripts.
Haven’s board, besides Gawande, Buffett, Dimon and Bezos, includes Todd Combs, portfolio manager and investment officer at Berkshire, and Beth Galetti, senior vice president at Amazon.
Haven rather early on got into a legal conflict with UnitedHealth Group’s Optum division. Optum sued a former executive, David William Smith, who was hired by Haven, over breach of contract. They alleged that Smith took proprietary information about Optum’s profit-and-loss statements and business strategies to Haven.
Last month, a Massachusetts federal judge denied Optum’s motion for a temporary restraining order against Smith to prevent him from beginning work. The case was sent to arbitration.
