June 17, 2024

Health Mettler Institute

Healthy LifeStyle & Education

How Amazon’s healthcare strategy has evolved

How Amazon’s healthcare strategy has evolved

Amazon has not been shy about its intentions to disrupt healthcare. 

The tech giant’s $3.9 billion acquisition of primary care company One Medical, which closed Wednesday, is the latest in a series of moves from a company determined to stake its claim in healthcare.

In a letter announcing the One Medical acquisition, Amazon CEO Andy Jassy said the company has been called upon by its customers to “radically improve the healthcare experience.”

Here’s a look at Amazon’s recent history in healthcare dating back to 2018 including discontinued projects, current offerings and what could potentially be next. 


Splashy announcements haven’t always yielded positive results for Amazon. The company launched a healthcare-specific venture called Haven in early 2018 with JPMorgan Chase & Co. and Berkshire Hathaway.

Haven was an employer-led coalition focused on lowering costs by using the three companies’ collective bargaining power to negotiate prices with providers. But Haven disbanded in January 2021, six months after CEO Dr. Atul Gawande stepped down from the company. The companies didn’t possess the economies of scale to tip the balance when it comes to healthcare, experts said at the time.

Another employer-focused flop was Amazon Care. The service was announced in 2019 as a virtual health clinic for employers enrolled in Amazon health insurance plans. The service became available to all customers in 2021 and added a behavioral health component in August 2022. But a few weeks later, the company shuttered the service after Amazon’s healthcare chief Neil Lindsay said the offering was not complete enough for large enterprise customers.

“We’ve determined that Amazon Care isn’t the right long-term solution for our enterprise customers,” Lindsay wrote in an email to employees.


In June 2018, Amazon acquired online pharmacy PillPack for $753 million. Initially, Amazon offered drug discounts to its Prime members but PillPack would eventually serve as the foundation for its Amazon Pharmacy service.

Amazon Pharmacy launched in November 2020 and allowed Prime members across 45 states to have access to unlimited, free two-day deliveries of prescription medications and drug pricing transparency tools. The pharmacy service has since expanded to customers in all 50 states with or without a Prime membership but still limits discounts to members.

Last month, the company announced RxPass, a generic drug subscription service aimed at consumers with common conditions like high blood pressure, acid reflux or anxiety. The medication delivery service costs $5 per month for Prime members. 

RxPass will target people with chronic conditions who require multiple prescription medications and pay for them out-of-pocket. 

Christina Farr, an investor at San Francisco-based venture capital firm OMERS Venture, said launching RxPass was unsurprising given the company’s vast logistics networks and PillPack acquisition.

Amazon Clinic

In November 2022, Amazon launched virtual health offering Amazon Clinic in 32 states, allowing users to access third-party telehealth providers for non-urgent health conditions ranging from sinusitis to urinary tract infections. Patients can send prescriptions to any pharmacy including Amazon’s in-house pharmacy service. 

The service operates as a “virtual health storefront” offering users access to third-party telehealth providers. HealthTap, a virtual primary care provider, and SteadyMD, a telehealth provider operating in all 50 states, have listed services in several states and conditions.

The service does not accept insurance for visits but users can choose to use health savings accounts for payment. Amazon said costs of appointments will be shared with members beforehand.

One Medical 

Amazon’s $3.9 billion acquisition of One Medical is the company’s latest and potentially most significant move.

Amazon announced its intent to acquire the primary care provider in July. The deal drew interest from federal regulators and took seven months to close. With the deal finalized, Amazon inherits One Medical’s 836,000 members and 221 medical offices across 27 markets, according to regulatory filings by One Medical’s parent company 1Life Healthcare. 

By acquiring One Medical’s in-person clinics, Amazon dramatically increases the services it’s able to offer patients, said Jacob Effron, principal at venture capital firm Redpoint Ventures. Effron said the tech giant is trying to build an end-to-end patient experience in a way that can scale quickly.

It could also lead to an extension of brick-and-mortar storefronts, experts say. 

“Following the leads of other retail, I imagine we’ll see some collaboration of this [One Medical] storefront with other storefronts they own [such as Whole Foods],” said Nathan Ray, a partner in consultancy West Monroe’s healthcare and life sciences practice.

Competition is expected to heat up as more big retailers look to expand in healthcare services through primary care offerings. Earlier this month, CVS Health announced it will acquire primary care provider Oak Street Health in a $10.6 billion deal. And Walgreens subsidiary VillageMD agreed in November to buy Summit Health-CityMD for $8.9 billion.

AWS endeavors 

Amazon’s healthcare reach is also evident in its efforts to bring hospital data to the cloud, an area experts say will continue to grow as on-site data center environments become increasingly antiquated. Amazon Web Services holds 24.3{08cd930984ace14b54ef017cfb82c397b10f0f7d5e03e6413ad93bb8e636217f} of the global healthcare cloud market, according to market research firm Insider Intelligence.

The cloud computing division of Amazon introduced Amazon Omics in December, described as a “purpose-built managed service” intended to help bioinformaticians and biomedical researchers store, query, and analyze genomic, transcriptomic, proteomic and other data to advance scientific discovery and develop new diagnostics and therapeutics.

Amazon said the goal of the service is to “enable large-scale analysis and collaborative research for organizations to analyze omics data with purpose-built data stores, scalable workflows, and multimodal analytics.” Amazon Omics stores data—and thus bills customers—according to the number of gigabases the platform ingests. This offers “price predictability” regardless of whether the sequences are from short-read or long-read instruments, according to AWS.

What’s next?

Amazon has not commented specifically on what could come after One Medical but experts have their opinions. Ray said forming relationships with payers is likely to be important as the company becomes more deeply intertwined in healthcare.

“The idea here is not to break what you just bought,” Ray said. “They’re going to [need] some expanded relationship with how [their suite] works with payers.” 

Other experts said the company could begin to address price transparency. 

“The question of how much does it cost has still not been solved. Nobody even knows,” Farr said. “I think that’s where they’re moving. A lot of the moves they’ve made already get them some of the data to start putting that together.”

Farr highlighted the strong relationships One Medical has with health systems as a way to see the true costs of primary care referrals. Amazon could pair that data with data it has from prescriptions and expenditures to develop a fuller picture of patient care costs.

Ray said there could be a simpler reason for the company’s healthcare strategy.

“[Connecting] strategically the things they’re doing in healthcare is maybe the wrong way of thinking about it. Just think about each of these [initiatives] as maximizing [profit] until they have to connect.”

This story first appeared in Digital Health Business & Technology.