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Oregon’s health agency has approved Amazon’s proposed acquisition of primary care provider One Medical, clearing a potential hurdle for the tech and e-commerce giant to gain a greater foothold in the health care industry.
Following a new state regulation, the Oregon Health Authority reviews business deals, like mergers and acquisitions, to examine potential impacts on cost, quality of care, equity and access to services. With five One Medical clinics in Oregon, the proposed Amazon deal falls under the state agency’s purview.
Amazon announced a $3.9 billion deal in July to acquire One Medical, a membership-based service that offers virtual care and in-person visits. The Oregon Health Authority began its 30-day preliminary review of the acquisition at the end of November. On Wednesday, the agency said it had approved the transaction, with some conditions.
The preliminary review found Amazon’s acquisition was not likely to substantially reduce access to affordable health care in Oregon, the health agency wrote in its report. That’s partly because patients have many other options to access similar types of services and because One Medical’s patients represent a small number of people accessing care in the state.
Amazon’s advanced supply chain and purchasing power could generate efficiencies and savings for One Medical, the agency continued, though it’s not guaranteed those savings would be passed on to consumers.
The health authority acknowledged there could be potential equity concerns if One Medical siphons off commercially insured patients with higher payment rates from clinics that serve patients covered by Medicaid and Medicare. That concern is mitigated by the provider’s “small footprint” in Oregon, it continued.
Despite its approval, the agency is requiring Amazon and One Medical to consistently report information on the services they provide, the patients they serve, quality of care and any governance or organizational changes. Amazon and One Medical will have to submit reports every six months for five years.
The Oregon Health Authority will also conduct its own analysis for the first, second and fifth year after the deal is finalized to assess whether the health care providers have “kept to their commitments” regarding cost, access and quality of care.
During the agency’s review, several groups and individuals submitted comments opposing the transaction and expressing concern about health care companies prioritizing profits over patients, the department wrote in its review.
SEIU Local 49, the chapter of the Service Employees International Union that represents some health care workers in Oregon and Southwest Washington, pointed to allegations regarding Amazon’s treatment of workers in other parts of its business.
Patient concerns, combined with Amazon’s focus on profit, have made the union “concerned this trend may worsen and ultimately impact the care received by the residents of our state,” SEIU wrote in its public comments. “If the deal is to move forward, we believe the [Oregon Health] Authority should explore imposing strict conditions to safeguard Oregon workers and patients.”
Though it got the green light to move forward in Oregon, Amazon’s acquisition is still subject to regulatory approval. The Federal Trade Commission is investigating the proposed deal.
An Amazon spokesperson said “we continue to work cooperatively with OHA and the FTC in their reviews of this transaction.”
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