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Out of the gate, the new health care venture from Amazon, Berkshire Hathaway and JPMorgan Chase seems to be headed in the right direction — using new technology to provide their employees better value and health outcomes. That’s where things will start, but this could be a laboratory for a more sweeping transformation.

The big picture: To bring lower costs and better care to their employees and others, these companies will need to do more than deploy a modern technology overlay. They will have to better align payments and outcomes in health care across the board. If they accelerate this process, we will all benefit.

The problems: Our health care system is afraid of new technology, partially because of outdated ideas about how to pay for care that are layered into government programs. Consider the example of Type 1 diabetes — a chronic condition that affects more than 1.2 million Americans.

  • New technology called continuous glucose monitoring, or CGM, uses a digital sensor to monitor patients’ blood-sugar levels throughout the day, without requiring them to draw blood.
  • CGM is even more effective when it pairs with analytic algorithms and a smartphone. Patients can share readings with a doctor in real time, or automatically alert loved ones in the case of an emergency. These are precisely the kind of technologies a company like Amazon should know how to leverage.
  • Because of old and often inflexible rules, Medicare won’t have anything to do with CGM if a smartphone is involved. The government doesn’t want to be in the business of paying for smartphones.
  • Private coverage has moved in the right direction on these challenges, but some patients worry — for legitimate reasons — about whether their plans will fully cover their costs.

But it’s not just about paying for new technology. We also need to pay for new expertise and approaches to care.

  • Right now, most of our health care system pays doctors for what they do, not what they achieve. Instead, payments should be based on long-term outcomes and factor in overlooked but critical parts of a doctor’s job, like time spent helping their patients learn to use these new technologies.

The bottom line: Amazon, Berkshire and JPMorgan are deep-pocketed companies whose executives have a track record of discovering value. But their leverage and creativity will only bring about widespread change if they address fundamental payment and regulatory issues that govern American healthcare.

Go deeper

Anti-Trump lawmakers' private security expenses ballooned after Jan. 6 riot

Sen. Mitt Romney (R-Utah) speaking to reporters on Capitol Hill on April 14. Photo: Kent Nishimura/Los Angeles Times via Getty Image

Members of Congress are spending tens of thousands of dollars on personal security for them and their families in the wake of the Jan. 6 riot, according to an analysis of first-quarter Federal Election Commission reports by Punchbowl News.

Between the lines: Private security expenditures were especially common among anti-Trump Republicans and high-profile Democrats who earlier this year voted to impeach and convict the former president for inciting the deadly Jan. 6 Capitol riot, signaling they fear for the safety of themselves and their families.

1 hour ago - World

Jimmy Lai among Hong Kong pro-democracy leaders sentenced to prison

Students standing under a banner during a flag raising ceremony on the first annual National Security Education Day in Hong Kong. Photo: Vernon Yuen/NurPhoto via Getty Images

A Hong Kong court sentenced a group of the city's most prominent pro-democracy activists to up to 18 months in prison Friday for organizing a massive unauthorized protest in August 2019 that drew an estimated 1.7 million people, AP reports.

Why it matters: Critics say the sentences send the message that even peaceful pro-democracy activism will be severely punished. They mark a continuation of Beijing's overhaul of Hong Kong's political structure, designed to crack down opposition to the Chinese Communist Party.

Local news moves to the inbox

Illustration: Annelise Capossela/Axios

A slew of new companies are launching platforms for local newsletters, a shift that could help finally bring the local news industry into the digital era.

Driving the news: Substack, the email publishing platform for independent journalists, on Thursday announced a new local news platform.