In January 2018, the CEOs of corporate giants Amazon, Berkshire-Hathaway, and JPMorgan Chase announced a joint venture to seek “ways to address healthcare for their U.S. employees, with the aim of improving employee satisfaction and reducing costs.”
This comes from what was the only written information the companies have put forth on this venture, a 440-word press release issued on January 30. The press release went on to say:
“The initial focus of the new company will be on technology solutions that will provide U.S. employees and their families with simplified, high-quality and transparent healthcare at a reasonable cost.”
In April, a new document entered an additional 247 words into the canon of the Amazon, Berkshire and Chase joint venture — Chase CEO Jamie Dimon’s annual letter to shareholders.
Jamie Dimon Seems to be Driving the Joint Venture
The first thing to notice is that Dimon wrote about it at all. Berkshire-Hathaway CEO Warren Buffett did not mention it in his February 24 letter to shareholders — neither did Amazon CEO Jeff Bezos in his April 2018 letter to shareholders.
Dimon was also the subject of a series of news articles in February 2018. Multiple sources verified that he was calling JPMorgan Chase healthcare clients to assure them that the joint venture posed no threat to them.
Does Jamie Dimon’s letter to shareholders and media attention indicate that he is driving the joint venture? Hard to say without knowledge of the internal workings of the new organization. Certainly, the joint venture seems more top-of-mind to the Chase CEO, and he seems to be the public face of it.
Dimon in 2020?
Also worth noting is that Dimon placed information about the joint venture in the public policy section of the document.
The original press release speaks of the joint venture in terms of the “U.S. employees” of Amazon, Berkshire, and Chase. The word “employee” is the most frequently used word in the press release. “Costs” is the fourth most frequently used word.
However, Dimon sees this as a public policy issue rather than an opportunity to give shareholders the business case for reducing employee healthcare costs. He frames the joint venture in the context of the massive costs of Medicare, Medicaid, and Social Security, rather than the employee healthcare costs of his own business.
Most of Dimon’s nineteen pages of policies are centrist and smart. Frankly, they warrant reading.
I’d like to direct you to some other CEOs who have smart public policy insights in their letters to shareholders. But a quick search showed that Jamie Dimon’s peers don’t have a public policy section on their letters to shareholders. Warren Buffet does not. Neither does Jeff Bezos.
Dimon sees this as a public policy issue rather than an opportunity to give shareholders the business case for reducing employee healthcare costs.Steven Moore, IVN Health Care Editor
In the financial community, Bank of America CEO Brian Moynihan devotes six paragraphs in his 2017 letter to “Sharing the benefits of U.S. Tax Reform.” Considerably less than Jamie Dimon’s nineteen pages on public policy. Citibank’s CEO, Michael Corbat, talks a lot about community relations efforts and gently side-swipes public policy.
However, his entire letter is about 20% of the length of Dimon’s public policy section alone.
Why did Dimon invest so much energy into public policy in his 2017 letter to shareholders? He doesn’t have a long history of discussing public policy in his letters to shareholders. Neither his 2013 letter nor his 2014 contained the words “public policy.” In 2015, he devoted three pages to discussing public policy.
To fully appreciate the timing, it is important to realize that the shareholders letter is released in the year following its title. The 2016 letter was released in April 2017, and the 2017 letter was released in April 2018. Both letters come after the election of Donald Trump. One imagines Dimon thinking, “If that guy can do it…”
Some 2.6 billion JPMorgan Chase shares are held by 2,462 institutional investors. An additional 800 million shares are held by individuals. That’s not a bad venue of disproportionately wealthy and influential Americans on which to test policy ideas. A respectable base from which to launch a campaign.
Regardless of his motivation, Jamie Dimon gets it right in his letter to shareholders that much of the problem with healthcare in the United States is a public policy problem. The addition of political powerhouses like Amazon, Berkshire, and Chase in the fight to cut healthcare costs is welcome.
(Chase's shareholder base) is not a bad venue of disproportionately wealthy and influential Americans to test policies.Steven Moore, IVN Health Care Editor
The healthcare industry spent more than half a billion dollars on lobbying in 2017.
How will three of the largest corporations in America fare against the entrenched forces of the healthcare industry? That is a letter I want to read.
Image: JPMorgan Chase CEO Jamie Dimon, Amazon CEO Jeff Bezos and Berkshire Hathaway CEO Warren Buffett/ Dimon Image Source: Insider Monkey