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Amazon, JPMorgan and Berkshire Hathaway to create new healthcare company

Amazon has already entered the health care field, seeking state licenses to operate pharmacies.

Details were scant in a short joint statement on Tuesday.

Amazon, Berkshire Hathaway and JPMorgan are teaming up to form an independent, nonprofit venture that'll be focused on healthcare for their U.S. employees. "With health care, they capture the next, most valuable layer of the ecosystem - the system that keeps us well and healthy".

Shares in U.S. health insurers UnitedHealth, Anthem and Cigna Corp all fell over 5% in early trading following the announcement.

Also playing a factor in the market's reaction is the significant size of the companies involved in the three-way partnership. The initial objective of the new company will be to find technology solutions to simplify the health-care system.

US health care spending grew 4.3 percent in 2016, according to the Department of Health.

Amazon.com founder and CEO Jeff Bezos presents the company's first smartphone, the Fire Phone, on June 18, 2014 in Seattle, Washington. In the statement, JPMorgan CEO Dimon said the initiative could ultimately expand beyond the three companies. Yet, Amazon, Berkshire Hathaway, and JPMorgan have, in Dimon's words, "extraordinary resources" that can be committed to "create solutions that benefit our US employees, their families, and, potentially, all Americans". The federal Affordable Care Act requires all companies with 50 or more full-time employees to offer it. In much of the world, the most effective health care system is single-payer, where the government is responsible for providing health care to all citizens.

And in January, a group of hospitals, including Salt Lake City-based Intermountain Healthcare, Ascension, SSM Health, and Trinity Health, along with the Department of Veterans Affairs health administration (a group that in total represents 450 hospitals) announced their plans to create a nonprofit generic drug company. Combs also joined JPMorgan's board in 2016. CVS Health announced its acquisition of Aetna in December, which brought together a pharmacy and insurance business that industry experts say could make it less vulnerable to any disruption from Amazon.

One of the highest ranking women at Amazon, Galetti has worked in human resources at the e-commerce giant since mid-2013, becoming senior vice president nearly two years ago, according to her LinkedIn profile. CNBC reported in July that a health tech team at Amazon was working on medical records and telemedicine. Previously Galetti worked in planning, engineering and operations at FedEx Express, the cargo airline of FedEx Corp.

Spencer Perlman, an analyst at Veda Partners, said the statement by Amazon, Berkshire Hathaway and JP Morgan is "nothing more than a promise to do something different and provides no detail on what the companies plan to do or how they plan to do it".

The US still spends far more on healthcare than other wealthy nation as it sees decline in general health over the last three decades. Buffett has long bemoaned the cost of USA health care.

Buffett has always been critical of the USA healthcare system, comparing it to a "hungry tapeworm" gnawing at the national economy.

When Jeff Bezos, Warren Buffett and JPMorgan's Jamie Dimon say they want to improve health care for potentially millions in the USA, among the first questions will be: Where to start? Their group could not provide solution to the problem but they also do not admit it as inevitable.

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