Amazon’s Healthcare Dreams Are Fractured

Amazon, along with its Big Tech brethren, has long been trying to break into the healthcare market. But it’s not going as planned.

(Photo by National Cancer Institute on Unsplash)

Sign up for smart news, insights, and analysis on the biggest financial stories of the day.

Even Amazon can’t win ‘em all.

A Bloomberg report published on Monday suggests Amazon has something of a reverse Midas touch when it comes to cracking the healthcare business, where everything the e-commerce giant touches turns into largely empty cardboard boxes with way too much puffy plastic packaging inside.

Health Struggles

Amazon, along with its Big Tech brethren, has long been trying to break into the healthcare market. Just this month it announced that Prime members would get a discount on its boutique primary care business One Medical, which Amazon acquired in February. Bloomberg spoke to Amazon insiders about the company’s various attempts to get a foothold in healthcare, many of which have collapsed into dust. Some described a certain amount of hubris from management, bringing in executives who had no experience in healthcare and ignored advice from people who’d worked in the sector. Others said that drawn-out debates about how to approach new products meant that Amazon was at most one step ahead of the competition, if not behind it.

One of those offerings, a telehealth service called Amazon Care, failed to take off even though it arrived in good time to catch a surge in demand for telehealth care fueled by the pandemic:

  • Sources told Bloomberg that Amazon had a hard time selling the service to employers and even when it did, it got a lukewarm reception from users. One former Amazon Care nurse told Bloomberg she would go hours without seeing a patient.
  • That might give a clue as to why Amazon targeted One Medical for acquisition. Neil Lindsay, Amazon’s head of healthcare, told Bloomberg the acquisition of One Medical brought 8,500 corporate clients with it.

Lindsay pushed back against Bloomberg’s portrayal of Amazon’s healthcare ventures as hubristic. “I actually think that we are approaching this with a lot of humility,” Lindsay said — a word not many consumers will associate with Amazon. “We’re going to have some hits and misses, and we’re OK with that experimenting and learning,” Lindsay added, which to be fair is not confined to Amazon’s healthcare ambitions — RIP the Fire Phone.

Package Deal: When it comes to its e-commerce bread-and-butter, Amazon fares much better. A report from The Wall Street Journal reveals that the company’s logistics empire has finally surpassed both UPS and FedEx in terms of sheer volume packages. Like aging rock bands still going on tour, sometimes even massive tech firms just need to play the hits.