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Amazon’s Health Care Plans Are Driven By Its Bottom Line, Not Its People

Amazon, JPMorgan Chase, and Berkshire Hathaway announced on Tuesday that they would be teaming up to form an independent health company ― one that is “free from profit-making incentives and constraints” ― for their U.S. employees, with a long-term aim of creating health care solutions that benefit, “potentially, all Americans.”

Although no details for this proposal were offered in the announcement, stock prices for insurance giants like UnitedHealth and Anthem fell steeply in its wake, an indication of the perceived power of the combined effort of these three corporations.

It’s impossible to assess the viability of their plans when there really aren’t any, but it makes perfect sense that three large companies, recognizing that they are contributing to the record profits of other large companies ― i.e., insurance companies ― would want to take a stab at decreasing their own expenditures.

And indeed, in spite of the seemingly progressive rhetoric (“improving employee satisfaction,” “free from profit-making incentives,” etc.), every commentator on this proposal saw it quite clearly as a business decision. The New York Times even compared it to “classic disruption,” where a company enters “a market with a product that is lower in value than that of market incumbents, but much lower in cost.” That a proposed nonprofit health care company would be immediately and so easily compared to “classic disrupters, like Southwest Airlines, MP3s or Japanese carmakers,” is a good indication that most people doubt that health is really the goal here.

And with good reason. Amazon is conducting an experiment in ”purposeful Darwinism,” according to a New York Times profile of life inside the business, to see just how far it can push its workers, and with little concern for their health. The same piece found 80- to 85-hour workweeks with no work-life separation to be the norm for some workers, and there were accounts of people who fell ill being threatened with dismissal for their “personal difficulties.”

For blue-collar workers, the brutality is even more straightforward: In 2011, Amazon stationed paramedics and ambulances outside its factory in Allentown, Pennsylvania, to cart off workers as they collapsed in the 102-degree heat.

This is all to say that Amazon CEO Jeff Bezos is interested not in people’s health but rather in his bottom line. It’s very possible that he and his partners will find a way to cut down on the obscene administrative costs of most health insurance companies, including the $20 million per year on average that most insurance CEOs make. But even with the combined 1 million employees between the three companies, ”the idea that they could have any sort of negotiation leverage with unit cost is a pretty far stretch.”

The basic idea being toyed with here is, however, a good one: By having significant buying power through the representation of a large number of people, it is indeed possible to negotiate medical costs. The Department of Veterans Affairs, for instance, gets a 40 percent discount on drugs, and pharmaceutical costs in countries with single-payer health care are much lower than in the U.S.

Amazon and its allies are thus right to think that the exorbitant cost of health care can be reined in by eliminating the profit motive and consolidating buying power, but in both cases a single-payer Medicare for All system is a far better proposal than their own. Medicare for All would allow for real negotiation over medical costs and would ensure that profit doesn’t endanger care. As long as health care is subservient to corporate interests, any cost-cutting will be to the benefit of the rich, not the sick.

As Mark Dudzic of the Labor Campaign For Single Payer points out, there’s a good reason corporate America won’t get behind a proposal that both saves them money and has the support of the majority of Americans: It’s all about power.

Companies like employment-based health care, despite its costs, because it keeps the workforce captive. They also fear slippery slopes and know that the socialization of one industry could mean that theirs is next. Bezos and company thus want to take on the enormous project of starting a health care nonprofit because they want to stave off any threats to their own power.

Progressives are not the only group in the political spectrum that has “awoken” in recent years. Capitalists too are very aware of popular discontent, the kind that could actually endanger their position rather than just feed the Democratic Party machine and will no doubt continue to trot out proposed “solutions” to political crises in health care, education, housing, transportation and so forth. The only real solution to these problems is to eliminate the profit motive once and for all, and that means bringing social goods back under social control.

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