Amazon is Making Inroads into Nashville’s Health Care Industry

Amazon is already a leading player in a wide range of industries from logistics to consumable manufacturing, but it's taking steps to become a significant factor in yet another sector: health care. As announced in January 2018, Amazon has embarked on a venture with JPMorgan Chase & Co. and Warren Buffet's Berkshire Hathaway to form a health care company focused on reducing health care costs for their employees. The latest development from Amazon--a new logistics hub in Nashville with 5,000 jobs--was announced in mid-November, carving a clear path for Amazon to establish a lab in this health care-dominant city.

On the surface, this new logistics hub is a consolation prize for Nashville after the southern city lost out on the opportunity to host Amazon's second headquarters. Those closely following Amazon's developing interest in health care, however, see added potential for this hub to serve as an experimentation lab as well. Paul Keckley, an analyst and researcher in the health care sector, notes that the decision to locate their new logistics hub in Nashville is likely "not coincidental" but a conscious choice to establish "a lab:" "[Amazon] will learn a lot about this industry by interacting with these companies. And they'll go in the door saying, 'We can help with cost.'"

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Evidence already exists that Amazon is well aware of Nashville's central position in the health care industry, having joined the Nashville Health Care Council via its Amazon Web Services arm in recent years. The location for the announced logistics hub couldn't be better to take advantage of Nashville's health care concentration; the planned office will be just down the street from the headquarters of HCA, the country's biggest hospital chain.
Only time will tell how effective Amazon will be in breaking into the existing health care market in Nashville. Many in the industry think that established companies will be resistant to Amazon’s attempts at building inroads into the industry. However, the newer wave of health care startups might be more welcoming to Amazon’s influence. As Vic Gatto, CEO of startup Jumpstart Foundry, notes: “Any of the innovative, kind of change-agent aspect in health care love new players coming in.”