What is Amazon Care? The problems with Amazon Care

What is Amazon Care? The problems with Amazon Care Amazon is shutting down its telehealth service, Amazon Care, marking a major retreat by the retail behemoth in its efforts to break into the health care space.

Amazon will shutter the service after Dec. 31, Amazon Health Services lead Neil Lindsay announced Wednesday in a company email. The e-commerce giant decided to make the move after determining it wasn’t “the right long-term solution for our enterprise customers,” Lindsay wrote in the memo, which was previously reported by GeekWire.

“This decision wasn’t made lightly and only became clear after many months of careful consideration,” Lindsay said. “Although our enrolled members have loved many aspects of Amazon Care, it is not a complete enough offering for the large enterprise customers we have been targeting, and wasn’t going to work long-term.”

Amazon Care

What is Amazon Care?

At Amazon, we want to make it dramatically easier for people to get and stay healthy. We’ve begun that journey with Amazon Pharmacy—where customers can get their medication delivered to their door conveniently—in just two days for Prime Members.

We’ve also entered into an agreement to acquire One Medical, a human-centered and technology-powered provider of primary care. One Medical members benefit from a dedicated relationship with their provider, a friendly and convenient in-office experience, and ongoing engagement via a dedicated app.

Amazon Pharmacy and One Medical are two key ways we’re working to make care more convenient and accessible. But we also know that sometimes you just need a quick interaction with a clinician for a common health concern that can be easily addressed virtually. We’ve thought hard about how to improve this part of the experience as well.

That’s why today we’re also introducing Amazon Clinic, a message-based virtual care service that connects customers with affordable virtual care options when and how they need it—at home, after dinner, at the grocery store, or on the go—for more than 20 common health conditions, such as allergies, acne, and hair loss.

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Amazon announces it will shut down Amazon Care

In an email to employees, Neil Lindsay, SVP of Amazon Health Services, said the company has “determined that Amazon Care isn’t the right long-term solution for our enterprise customers and have decided that we will no longer offer Amazon Care after December 31, 2022.”

“Although our enrolled members have loved many aspects of Amazon Care, it is not a complete enough offering for the large enterprise customers we have been targeting, and wasn’t going to work long-term,” Lindsay wrote. He added that the “decision wasn’t made lightly and only became clear after many months of careful consideration.”

Lindsay emphasized that Amazon remains committed to its health care businesses. “Our vision is to make it easier for people to access the health care products and services they need to get and stay healthy. We know accomplishing this won’t be easy or fast, but we believe it matters,” he said.

Roughly 400 employees work for Amazon Care, the New York Times reports. According to Lindsay, “many” will find new roles within Amazon, and the company intends to “support employees looking for roles outside of the company.”

Amazon did not say to the Times whether employees will be laid off if they can’t find a new role within Amazon. But according to the Washington Post, dozens of employees will lose their jobs, with some departing as soon as October.

Amazon Care

The problems with Amazon Care

Amazon Care appears to have struggled to understand the nuances and demands of care delivery, as detailed recently in The Washington Post. Clearly, the tension between expectations for growth and quality were real. This raised questions for us: Was Amazon going to truly “iterate” on its health care capabilities? When it came to care delivery, would Amazon get better, or would it do enough to get by?

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Amazon concedes that its product was not comprehensive enough for its employer partners. It’s unclear whether that means it simply wasn’t saving them money, even if employees were using it. At the same time, we wonder how hard it was to persuade employees to embrace Amazon-branded health care or to attract employees to a product centered on virtual and home-based care—or some combination of the two.

Remember: Everyone had to try out telehealth in 2020 because, in many cases, they had no choice. There isn’t any similarly powerful and pervasive force pushing anyone to virtual-first care today. People tend to like virtual visits, but that doesn’t mean that they want to receive all their care that way. And even beyond that, it’s entirely possible this product simply could not adequately satisfy users or keep care from fragmenting with its mosaic of services, channels, and providers.

What shutting down Amazon Care suggests about Amazon’s health care ambition

Amazon’s willingness to jettison its homegrown but underperforming health care business suggests three things.

  • One Medical is the centerpiece of Amazon’s health care strategy, not simply one component among many. When viewed this way, the details of the acquisition make more sense than they did four weeks ago. Knowing that a virtual and home-based model wasn’t attractive for employers, we can understand more clearly why Amazon wanted a partner with both in-person and digital health capabilities. Knowing that its own product was struggling, we can see why it was willing to pay a huge premium for One Medical.
    Amazon is iterating on its health care capabilities, but it is iterating at an enormous scale. “Fail fast” is axiomatic in technology. It’s usually applied to minimum viable products—applications and services that are quickly built, delivered, and assessed for their ability to meet customer demands and gain traction in the market. Products that don’t meet those demands are replaced as quickly as possible.
  • Obviously, Amazon Care was not a minimum viable product. It was rolled out three years ago, and it offered telehealth services in all 50 states and in-home services in seven markets. But when you look at the pivot Amazon seems to be making from virtual and home-based care with Amazon Care to in-person and virtual with One Medical, it’s hard not to reach for the “fail fast” comparison.
  • Amazon is a different kind of competitor in health care. We can’t think of another organization that would spend years building out a care delivery enterprise, roll it out in 50 states, and then simply shut it down. We also can’t think of another organization whose alternative care delivery plan is to spend nearly $4 billion on another company. It’s not just the scale and the money—it’s the willingness to throw around those assets that makes Amazon a potentially potent competitor.
  • There are still enormous execution challenges for Amazon and One Medical. Massive disruption of the industry is not a given, no matter how much money is spent or how many companies are bought and/or fail. It seems likely that the impact of Amazon on the market will be centered, at least for the immediate future, on the same direct-to-consumer approach that One Medical has taken and at which Amazon is expert in its other lines of business.
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That does not mean Amazon can be dismissed as a dilettante or a dabbler in health care. Its mere presence in the market already seems to have sparked a bidding war for Signify Health. Amazon’s continued iteration of its approach to health care demands ongoing attention.

Amazon Care

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