Amazon is trying to persuade Aetna and other health plans to cover its medical-care service, but it stumbled out of the gate

Patients talk to a physician with Amazon Care’s app.

  • Amazon’s medical service has approached several health plans to become a covered benefit.
  • That would allow Amazon to reach more people and more companies.
  • But Amazon Care isn’t set up to do business the way some of the health plans want.
  • See more stories on Insider’s business page.

Amazon’s fledgling medical-care service is approaching big health insurers, including Aetna, in an attempt to persuade them to pay for it, but it’s struggling to get some of them on board.

Securing health-insurance coverage would be a crucial milestone for Amazon Care as it seeks to expand to more people and more companies across the US. Right now, Amazon Care works with big companies that pay it directly, including Amazon itself, Precor, and a few others.

Amazon Care has approached Aetna, which is owned by CVS Health, and several regional insurers like Premera Blue Cross to join their networks as a covered benefit, three people familiar with the matter told Insider. They were not authorized to discuss Amazon’s plans on the record.

Private health insurers wield immense power in the $3.8 trillion US healthcare system. They determine which providers people can see, while making it more costly to access others.

Amazon’s decision to try to work with these gatekeepers signals that it has ambitions to work with a broader variety of customers.

Expanding the reach of Amazon Care

Amazon Care works through a mobile app, allowing people to see a care team through video chats, text messaging, and sometimes in person, including at home. The care teams can give vaccines, do lab testing, write prescriptions, and more.

It started as a pilot for Amazon’s employees in Washington, but this summer Amazon Care will expand its virtual services to the rest of Amazon’s US workforce, which is about 950,000 people. The home visits will be limited to Washington, DC, Baltimore, and other selected cities.

Andy Jassy
Amazon CEO Andy Jassy.

Becoming a covered benefit would allow insured people to use Amazon Care as they would any other in-network healthcare provider. It could introduce the service to millions of patients, depending on the agreement, and spare Amazon Care from having to contract directly with lots of different employers.

Aetna, for instance, has 23.6 million members, including 16.8 million with commercial insurance from their jobs or that they buy directly.

Amazon Care has also pitched to other regional health plans, including Blue Cross Blue Shield of Massachusetts, two of the people said. The insurer declined to comment.

But Amazon has run into problems in these conversations that are related to how it wants to be paid, the three people said. The status of any particular conversation could not be learned.

In particular, Amazon initially approached the health plans seeking to set up “value-based” arrangements, two of the people said. That typically means that a health plan pays a provider based on how well they care for patients and whether they can lower the overall cost of medical care, though Insider couldn’t learn what particular arrangement Amazon pitched.

A spokesperson for Amazon Care said they couldn’t comment on rumor or speculation. Aetna and Premera declined to comment.

A clinician from Amazon Care's partnered doctors' group examines a patient in a home visit.
A clinician from Amazon Care’s partnered doctors’ group examines a patient in a home visit.

Companies asked Amazon Care to get covered by health plans

Amazon Care is approaching health plans now partly because it was asked to do so by the companies it’s working with, including Amazon, its biggest client, one of the people said. Employers want their workers to be able to use their insurance when accessing Amazon Care, the person said.

Now, companies typically pay a monthly fee for each employee to have access to Amazon Care. They also pay fees when workers use the service. Currently, Amazon Care charges patients a copay, and pharmacies or labs it works with may bill insurance separately.

As a covered benefit, people could apply the cost of an Amazon Care visit to their deductibles, which is the amount they must pay out of pocket before insurance kicks in, and their out-of-pocket maximum, which is the most an insured person can pay in a year.

Aetna president Karen Lynch
CVS Health CEO Karen Lynch.



Amazon self-insures its employee health plans, meaning it pays for the cost of its employees’ medical claims itself. But it works with Aetna and Premera to administer its plans. They perform tasks like setting up networks of providers and processing claims.

Becoming a covered health-insurance benefit could make it simpler for large companies to work with Amazon Care. Plus, companies would likely only pay for visits when their workers use the service, rather than paying a monthly fee.

Jeff Bezos
Jeff Bezos

It’s typical for a telehealth company to get paid per-member, per-month fees by employers to offer their services to workers, outside of an arrangement with a health plan, Michael Yang, a managing partner at Omers Ventures, told Insider.

But as telehealth has become more prevalent, some startups are taking another approach and striking up contracts with insurers to be in network and get paid a negotiated rate, which is how doctors are usually paid, he said.

Amazon Care might not get paid the way it wants

In pursuing a value-based arrangement, Amazon is tapping into a trend that’s catching on in US healthcare as a way to control costs and improve care.

But some of the health plans have asked for “fee for service” arrangements instead, where they’re billed for each health service a person uses.

One reason, according to two people, is that the insurers want to see for themselves whether Amazon can really lower costs. You typically need millions of visits to show an effect on the cost of care, one of them said.

Value-based arrangements are also much more complex than fee-for-service, which insurers are used to.

Amazon Care doesn’t yet have the infrastructure to handle fee-for-service billing – such as getting the appropriate medical claims to insurers – neatly inside the app. That may delay agreements with certain health plans, two of the people said.

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