2022-08-25| M&ASpecial

Amazon Care Scrapped, Making Room for New Telehealth Endeavors

by Reed Slater
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After three years of toying with its telehealth service, Amazon Care, the retail giant, said in an email that it is closing the operation by December 31 this year. The announcement came just a month after Amazon announced its plans to acquire One Medical, a growing telehealth service, for $3.9 billion. The moves are another step in Amazon’s quest to reshape American healthcare.

Trial and Error in Telehealth: Abandoning Amazon Care

In the email sent to Amazon Health Services, Neil Lindsay, the vice president of the operation, said the decision to close Amazon Care took months of consideration and thought about the company’s future healthcare plans. Lindsay said Amazon Care was not a long-term solution for enterprise customers. 

Amazon Care started in Washington state in 2019 as a trial period to serve employees to gain a better understanding of telehealth implementation. Since then, the operation has expanded into all 50 states to serve employees and non-employees. In February, Amazon announced plans to open in-person care services in 20 cities nationwide to accommodate the growing demand for hybrid services. 

Now, though, Amazon will cease to exist next year, but the company claims other areas in its Health Services program will remain unaffected by the decision. Amazon did not disclose how many employees the closure will affect, but the company did say many Amazon Care employees will find spots in other areas of Amazon Health Services. 

Amazon’s attempts to break into healthcare are ongoing. With nearly unlimited cash flow from the other pillars of Amazon’s empire, the company is continually experimenting with new ideas and propositions. Earlier this month, Insider reported that Amazon is partnering with mental health care company, Ginger, to provide counseling services through Amazon platforms.

Though Amazon dabbles in various healthcare areas, telehealth and hybrid care seem to be a primary focus for the company to bring in a new era of healthcare delivery. The company’s recent announcement to acquire a fellow hybrid telehealth brand, One Medical, appears to be the replacement for Amazon Care.

Related Article: NIH Provides $23 Million to Fund Telehealth Cancer Care Research

From One Hybrid Telehealth Platform to Another

One Medical is a telehealth operation with more than 125 medical offices and 790,000 members nationwide. Like Amazon Care, One Medical is designed to accommodate both remote healthcare needs and in-person needs for general consumers and large companies that provide the service as a healthcare benefit to employees. 

The acquisition, which has not closed yet, will net Amazon all of One Medical’s current users and 8,000+ business accounts, which include the likes of Google, Airbnb, and Nasdaq. Amazon is laying down $18 per share to grab One Medical for a total of $3.9 billion.

Working with a more established healthcare provider, Amazon hopes to capitalize on a the growing telehealth market, which saw huge growth due to the COVID-19 pandemic. Whether or not it will be able to compete with traditional healthcare services will take time to realize, but the company sees an opportunity for reinvention of the industry.

Amazon Care’s closure seems to be just the beginning of expanded endeavors for Amazon. The recent acquisition of One Medical appears to be the beginning of a new path forward in the company’s attempts to build on its already overwhelming domain.

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