Amazon dips a toe into the insurance pool
Amazon debuted a health condition programs portal on Monday to help customers find and enroll in virtual care benefits, with diabetes care provider Omada Health as its first partner.
Why it matters: The move marks Amazon's toe-dip into two lucrative segments of the health marketplace: insurance benefits and chronic care.
Zoom in: By offering customers the ability to quickly review their employer-sponsored health insurance benefits, Amazon determines their eligibility for virtual care.
- Omada is the tech giant's only current partner in the endeavor, but Omada CEO Sean Duffy says he expects Amazon to name other partners soon.
- Amazon customers see a pop-up for the program when they search for diabetes monitoring devices such as glucose monitors or blood pressure cuffs that reads "managing diabetes or high blood pressure?"
Catch up fast: When Axios spoke to Duffy in 2022, he said the company was laser-focused on becoming employers' singular partner for health benefits.
- "We put all our chips in this vision of if you can find a partner for all of this, isn't that better than having all these point solutions and your care happening in an uncoordinated way?" Duffy said.
What they're saying: "Something like this, I've actually dreamed about for a long time at Omada," Duffy tells Axios this week. "But it never could have happened, because there was a chicken and egg" issue with scale.
- Now that Omada has 20 million people in the U.S. as customers, the relationship worked for both Omada and Amazon, he says.
Flashback: Amazon and Omada began discussing a potential partnership a year and a half ago, per Duffy, when he pitched the idea at a dinner with some of their executives.
- "I was sharing this feeling of, I walk down the street and I'm wondering, these people might have Omada ... but just not know it. Is there a way folks might find out about it through new channels? " he says.
- "Maybe you're searching [on Amazon] for a scale ... or blood pressure cuff or glucometer," Duffy adds. What if, "instead of having to pay for that, you find out your insurance benefit covers ... that device [and] an entire program to address and support you?"
Be smart: Amazon's try-everything approach to health care has included initiatives that spanned health wearables and medication delivery. Not every experiment succeeded.
- After several failed attempts at building home-grown care and insurance ecosystems, Amazon has opted instead to either partner with existing providers or acquire them outright.
- Amazon's latest move — partnering with Omada to offer employer-sponsored chronic condition management — fits into its more recent trajectory.
- The company offers virtual care for hypertension, diabetes prevention and management, behavioral health, and physical therapy using a combination of coaching and nutrition services and connected devices including blood pressure cuffs and weight scales.
State of play: The success of fully virtual diabetes care proved a major proof point for telehealth, with several companies in the space raising a bolus of venture funding in recent years.
- Digital diabetes care provider Virta Health in 2021 pulled in nearly $133 million at a $2.1 billion valuation.
- Virtual diabetes care startup 9am.health last April collected $16 million in Series A capital.
- Hybrid diabetes care provider Ryse Health last March drew $6.5 million in Series A funds.
The bottom line: "This could be one of the biggest examples of retail-meets-digital-health that's been tried," Duffy says.