JPMorgan launching business arm to address cost, quality of employer healthcare

While its joint venture with Amazon and Berkshire Hathaway, Haven, is no more, JPMorgan Chase is launching a new effort to address the cost and efficiency of employer-sponsored healthcare.

Morgan Health will serve as a new business arm within the company that's focused on these issues, the financial giant announced Thursday. Dan Mendelson will serve as CEO of Morgan Helth and report to Peter Scher, vice president of JPMorgan Chase.

Mendelson is the founder and former CEO of Avalere Health.

The company plans to focus on its own employees first but has ambitions to serve as a model for other employers, according to the announcement. JPMorgan plans to invest $250 million in promising healthcare solutions and improvements for the benefit of its employees and the broader employer health system.

“We need to try to make the U.S. healthcare system work better,” said Jamie Dimon, Chairman and CEO of JPMorgan Chase, in a statement.

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“We have the best healthcare in the world in terms of doctors, hospitals, pharmaceutical and medical device companies, but we certainly do not have the best outcomes," Dimon said. "Many of our problems have been around for a long time and are not aging well. There are ways we can make significant improvements and we intend to take a disciplined approach to solving some of these issues in a meaningful way.”

Morgan Health will partner with "leading" healthcare organizations to enhance the care options for its members and also aims to tackle disparities while boosting health equity.

The announcement teases that one of those collaborators is CVS Health. Morgan Health didn't offer any details on how the companies may be working together, but CVS CEO Karen Lynch said in a statement that the company is "looking forward to working with Morgan Health."

"We have a long-standing relationship with JPMorgan Chase and will continue to collaborate to make healthcare better for all employers," Lynch said.

That JPMorgan Chase, Amazon and Berkshire Hathaway were teaming up to find ways to reinvent the healthcare system was first announced in January 2018. The joint venture, later named Haven, remained an enigma for years before dissolving in January of this year.

When the breakup was announced, the companies said they would take the learnings from the project into their individual work to address healthcare costs and quality. Experts say the lack of news coming out of Haven over the course of several years was a major red flag.