Amazon Bought into Healthcare with One Medical. Now are We Waiting for Elon?
Healthcare doesn’t have any Elon Musks…or does it? Searching, like wise men for the baby Jesus, for a visionary in healthcare.
With the acquisition of One Medical by Amazon, whether the public knows it or not, a massive change is taking place in the tech-enabled and capital-inefficient healthcare landscape. The reason we don’t understand what the future of healthcare should look like is that we don’t have visionary leaders to explain it to us. There is no one championing the standard that we should follow. We don’t even know what that flag would look like. We are waiting for our Elon Musk for Healthcare (EMH for short). I’ll set the stage, make my case for Elon the Visionary, and describe what EMH will look like when she arrives.
Businesses– and I’m not talking about be “unicorn start ups” with valuations of single digit billions - dominate US and global healthcare. I don’t use the term dominate figuratively, I mean it quite literally.
To the dictionary!
have a commanding influence on; exercise control over.
"the company dominates the market for operating system software"
A quick review of the difference between BS companies—presumably built to be eaten by Goliath— and Real Companies which are hungry for lunch (or hungry for acquisitions at least), starting with a BS company:
Honestly, LifeStance investors, really? I don’t have any money and I’m still buying put options on this roll up with zero market strategy. You are aware that every clinician can make more money elsewhere the next day, right? Now a Real company:
Note the market caps for BS companies are off by at least an order of magnitude compared to Real Companies. Hark, another a BS company appears:
Single Digits. Snooze-fest. In Healthcare, The Most Real Company:
Half a trillion…wow. And to compare, Amazon:
Yes. That IS a market cap measured in Trillions of Dollars. Amazon is a Real Company. And with the acquisition of One Medical for $3.9b, Amazon is a Real Company all in on bricks and fancy couches in Healthcare.
These mega companies get to chose what qualifies as healthcare because they pay for it, and determine how much, and determine who, and determine when. They determine all the things, in a way that feels very…dominant?
The power to price and pay is the real power in any market. Consumers have the ability to choose in other markets. MegaCorps decide in healthcare. If they want it, they buy it. If they don’t want it, they buy it and then they kill it. And this is whole companies, not just products. If you choose to compete, and bring on investment money, you’re choosing to compete at their discretion. Practically, this is because they have the market power to make offers that no board (exercising its fiduciary duty to its investors) can refuse. It’s like indecent proposal, but everybody’s husband would have a fiduciary responsibility to sell their wife for the night. Or in this case, forever. Even just to have her killed because it was convenient for indecent proposer.
Every other adorable, scrappy start up company, issuing lovable press releases every day… is but a poor player strutting and fretting their hour up on the stage until either failure or acquisition. And both of those outcomes are determined by the Real Companies at the BUCA level...or Amazon level. Even 🦄 companies like Cerebral, with their $4.5b valuations after Softbank funding, are still just (frankly) cute when it comes to the entities they can eat them alive or starve them to death. Don’t believe me? Watch:
(Creepy robot voice) The displeasing entity has been terminated from all systems. (Bleep bloop).
Pro Tip: never, ever, ever name your company Done. It’s just asking for trouble in a Greek Tragedy kinda way. And speaking of Hubris…
I understand this painfully well: The time was the last 6 years of my life. The place was on the cutting edge of Healthcare. I was co-founder of a company that had a letter of intent with PrimeHealth (a fake Real Company, but based on a true story). We were Scaling Up to service this contract. We were a novel behavioral health practi—sorry, platform solution— that reduced hospitalizations by (this is true) 98% in a population enriched for severe problems like suicidal depression, OCD, personality disorders, and the like. We were willing to go 100% at risk on the contract. We got in-network with PrimeHealth. We agreed to their terrible fee-for-service rates…-they said this was the first step! We meet every metric PrimeHealth requested. We had the data. We had the team. We had an early One Medical team member! And…PrimeHealth did not sign the contract… they handed it to another company at after 1.5 years of meetings with their C level execs… that didn’t even have a significant behavioral health team at the time. But what they did have was a former PrimeHealth executive in leadership. Who I like a lot! Sigh. It was a devastating blow. I’m hustling for paid subscriptions RIGHT NOW in this article just to dig out of the hole:
I’m not saying they didn’t have the right to do it. They pick winners and losers. And I eventually exited that company, sold, as so many others, to a private equity group which turned it into something else entirely.
The game was rigged, I grumbled. I’m no EMH, it seems.
The game IS rigged for medical innovators. That isn’t changing for us…unless we gradually take over the leadership of these endeavors? Nah. I’m kidding. They will never risk their profits! Without real, serious companies—with bold Jeff-named founders—ready to deploy massive resources to change market fundamentals, this can’t happen.
We lack visionaries. Atul Gawande wanted us to use checklists He wasn’t wrong But…hard to argue it’s visionary. Amazon already tried with him at the helm of Haven. Thank god, world changed! Oh…wait. I love Atul. But not EMH, she who has been foreseen in the prophecies.
What does visionary leadership look like?
I think the answer here is surprisingly simple. It’s a lot simpler than people imagine. It doesn’t take being a hyper-genius. It takes one crucial thing: a real market insight. An insight that allows you to reconceptualize how everything should work. Not just “I just have one piece can fit well into the other pieces!”
I think Elon Musk is a brilliant human.
He is outspoken, controversial, irregular, not particularly fit for polite society, he’s an American original. He is an exemplar of why disagreeable people make real change happen.
But what makes him successful has almost nothing to do with any of that: he had a market insight about transportation. His insight was that Everything About it was Wrong. Instead:
People should be able to get from point A to point B faster and easier. That it, that’s the tweet.
And importantly, in keeping with the future-car-theme, where he was going, there were no roads.
That’s it. That’s the sum total of why I think Elon Musk and his approach with Tesla, SpaceX, the Boring Company, and who knows what next, will win transportation. Tesla is flashy, SpaceX is flashier, but the Boring Company is a revolutionary move.
That is So Boring! Get It?!
The Boring Company‘s name is a wry joke. In this context, for the unfamiliar, the word boring has two meanings. One is the more common— “uninteresting.” The other…
make (a hole) in something, especially with a revolving tool.
"the drill can bore through rock"
Get it? It’s a company that digs holes. In the ground. To make tunnels. To get people from point A to B. Quickly! Without traffic. In some kinda motorized vehicle capable of driving itself that looks suspiciously like a Tesla.
It didn’t take one company, even Tesla. It didn’t take two companies. It took three to build the required technology and believable track record of making money so he could do the actual thing that—I’m willing to bet—he has understood as needed to solve the fundamental “fast and easy travel” problem from day 1. Tesla was an easier company to raise money for. I’m building battery powered cars that go fast. Even self-congratulatory VC humans can understand that- they are excited to add value!. If he had told the world he was going to drill tunnels from the beginning, everyone would’ve thought him insane, and not in the fundable way.
The real brilliance of Elon is not that he’s so smart, it’s that he recognizes that we are not. People can’t believe things that are too far outside the Overton Window:
So, don’t tell them that story. Don’t sell them on the future, sell them on the believable next step—that gets you to where you know you need to be.
EMH will have this restraint. She will see the future, but not tell us more than we are ready to hear.
If the market insight is that getting from point A to point B faster and easier is the only acceptable answer. Sitting in traffic on the 405 isn’t a solution. It’s not about sitting in traffic in a better car. It’s not about a GPS that gets you in a slightly less traffic. It’s not about anything other than getting from point A to point B faster and easier. Which means, if you take it seriously, there isn’t a serious solution that makes its peace with existing roads and traffic.
Taking Physics Seriously
If you want to get from point A to point B faster and easier at scale, you care about fundamental problems in physics like the amount of energy necessary to go x distance at z mass with y acceleration. It’s not about a marketplace solution for navigating app selection… as a service. It’s not about a more-comfortable-car-matching platform. It’s about the fact that there are too many people trying to go places at once for our current road infrastructure to plausibly handle, and it’s too difficult to build new roads next to old roads.
You have to dig a tunnel. Or you have to fly. Flying has gotten pretty clogged. A lot of regulation gets in the way of flying. Even navigating roads with AI gets a lot of pushback from regulators. You’ve got a build your own road in your own tunnel, if only so you get to do the correct things—according to physics and economics only. Otherwise regulators and Nervous Nellies will get in your fucking way. Visionaries will disrupt the living daylights out of that kind of thinking.
Keep in mind, it’s about getting from point A to B. It’s gotta be fast and it’s gotta be easy. If it’s neither of these things, it doesn’t solve the problem and it axiomatically can not be part of your business plan.
So Elon built:
The cars that can drive themselves
The batteries to store the energy
The vector-space representations of intersections
The next-gen tunnel boring devices
Digging the tunnels that those cars will go through.
And that actually solves the problem. This is a revolutionary market insight in action. No one would ever have thought this was a good idea— except Elon did, cause he did the math on the physics and economics. ONLY. And he took the steps to execute the solution in sequence. He knew he would need a lot of satellites, so he built a space company to launch the goddamn things. If you’re going to solve this kind of problem you have to be serious about solving every single part of it, and not letting anything get in your way.
This is my archetype for Revolution in leadership in a market that needed disruption. People want to get where they’re going. This is all that matters.
And it was Foretold that Healthcare Would be Disrupted by Health Care!
So if healthcare (the industry) is going to change Health Care (the caring for the health of humans), it will need a visionary leader.
I have predictions, or perhaps (cue spooky pads and strings)…prophecies:
Our visionary leader will have a market insight. It will be breathtakingly simple.
Elon Musk for Healthcare (EMH) will not be a 22 year old 1st time start-up founder. Lo, Healthcare is really complicated. Hence, understanding it enough to be able to think up something that is simple takes experience.
EMH will probably not be actual Elon Musk. He would have talked about health care more. He talks about everything else.
I also don’t think Jeff Bezos is the chosen one. Time will tell, but he’s more likely in the running for Darth Vader/Anakin Skywalker of healthcare. Jeff is our Savior’s dad at best, and his redemption is similarly nigh.
She— who is coming to Disrupt Healthcare as Elon disrupted our batteries— is likely to be from outside PrimeHealth. It’s hard to see the Matrix from within.
She, of whom we were forewarned by a Frontier Psychiatrist, will have a Compelling Story of Lived Experience of a Serious Health Condition. Of this, we will learn on a special episode of the JRE. Lo, by Mr. Rogan’s having nothing vaguely libertarian or dismissive to say, will we know her to be the True EMH.
She will have died (in the fire-y wreck of a startup?) in yet another move “towards value based care” that was smote by the Wrath of the one true Payer?). Praise be Layoffs.fyi, she is Born Again in a new leadership role, and harken unto the good word as told in a Forbes puff-piece shared all across the LinkedIn lands, the fit will be better.
Her funding, blessed be, will likely be from sources both smart and unorthodox. I mean, Annie Lamont will also get in early, cause Oak HC/FT just raised a 5th fund. Is saying no to Oak HC/FT even allowed anymore?
She will be rumored to have had experiences with psychedelic medicine (honestly this is just playing the numbers at this point), and some will believe from this experience, insights came to make the world a better place.
She will destroy all those who came before by the end of her rule, including PrimeHealth.
Thus, it was foretold, and thus it will be.
—Owen Muir, M.D.
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