Amazon, Berkshire Hathaway and JPMorgan Chase are searching for a CEO for their new joint venture to improve health care for their employees while lowering costs. The group is casting a wide net across the health care industry to find the right person, say several sources familiar with the search, who declined to be named because the details of the initiative are confidential.
Berkshire Hathaway’s Todd Combs is taking the lead on the recruiting effort, several of the people said. Amazon has also been reaching out to people.
Among those on the short list for the position include former Medicare chief Andy Slavitt, former United States chief technology officer and Castlight Health co-founder Todd Park and ex-Aetna senior executive Gary Loveman.
Whether or not anyone in this group would take the job is another story. Slavitt recently disclosed plans to invest in health-tech start-ups via a new venture capital fund, and Park is working on a new insurance business called Devoted Health. Park told CNBC, “While I wish this new endeavor the very best, I am not a candidate to lead it.” Slavitt and Loveman declined comment.
Silicon Valley venture capitalist John Doerr has taken an informal role in the search, making calls to top health executives and even making a trip out to Nebraska to Berkshire’s headquarters. Doerr, who’s primarily known for his technology investments, has taken a personal interest in health care in recent years, including investing his money into the sector.
Doerr is a veteran partner at Kleiner Perkins Caulfield & Byers and an early investor in Amazon. He did not immediately return a request for comment.
What the joint venture’s leader would actually do to improve the health care experience for U.S. employees of the three companies is still a mystery. The group has been vague on details, except to state with the initial announcement that they hoped their size and scale would be enough.
The three companies may disintermediate the middlemen in the drug supply chain, such as the pharmacy benefits managers and drug distributors, or bring in new technology like telemedicine to improve access to primary care for workers across the country.
Right now, the CEO search process is as much about information-gathering as it is about making a hire, the people said, as the companies still haven’t yet decided on a final direction for their initiative.
The ultimate choice will potentially shed light on where the companies intend to focus, as few people have a background that encompasses medical services, health insurance, pharmacy benefits management and health-technology.
Combs, the potential heir apparent to Warren Buffett, has been named the lead executive from Berkshire Hathaway on the health care project. The other execs that will be involved are J.P. Morgan’s Marvelle Sullivan Berchtold and Beth Galetti, a senior vice president at Amazon. Berkshire did not return a request for comment.
The move comes amidst uncertainty and consolidation in the health care industry, driven by skyrocketing costs and growing dissatisfaction among employers, as evidenced by the Amazon-Berkshire-JPMogran joint venture.
On Thursday, insurance giant Cigna announced plans to acquire pharmacy benefits manager Express Scripts in a $67 billion deal, and Cigna CEO David Cordani called the current state health care market “not sustainable.”