Corporations are buying healthcare facilities around the country. Amazon bought One Medical, a network of primary care practices, for nearly $4 billion. CVS Health, which owns the ubiquitous drugstore and the major insurer Aetna, bought a national chain of primary care centers called Oak Street Health for $11 billion. This is part of a larger trend of increasing corporate ownership in healthcare.
One reason they’re doing this is because Medicare is making it particularly profitable. More than half of Medicare users are on private insurance plans under the Medicare Advantage program. The federal government pays those private insurers $400 billion a year. If you get in on that money you can make quite a sum. One Medical currently makes over half its profits from people on Medicare, even though those members only make up 5% of the company’s total patients.
Many doctors are concerned about these developments. Working under a corporate structure can limit their autonomy, keeping them beholden to profits over patient well-being. Specific complaints range from inadequately short visits with patients to understocked supply closets. In a particularly egregious example of corporate oversight in healthcare a hospital company named Prospect Medical Holdings failed to provide enough money for ambulance drivers to buy gas for their ambulances.
Defenders of corporate ownership in healthcare say that it brings money into clinics and hospitals that would otherwise be on limited budgets, and that it spurs competition and innovation in the world of healthcare. One Medical’s CEO had this to say about Amazon buying his company: “There is an immense opportunity to make the health care experience more accessible, affordable, and even enjoyable for patients, providers, and payers. We look forward to innovating and expanding access to quality healthcare services, together.”
Right now we have yet to see what the long term effects of corporate ownership in healthcare will be. It’s likely that medical malpractice cases will be unaffected, but if these corporations do an unusually bad job managing their healthcare clinics it could increase the number of negligence claims.
