3 Takeaways from Amazon Health Services Reorganization

For all its demonstrated business and tech intellectual property and ability to capture consumer loyalty, Amazon has yet to achieve its goals in health care.

That much was evident with the recent news that CNBC broke about Amazon Health Services (AHS) completing the restructuring of its operations into six units.

In the onslaught of news and speculation about the restructuring and what it signals for the online e-commerce and tech giant’s future, the field has been left with more questions than answers. Here’s what’s known about the restructuring and some key questions that Amazon will face going forward.

What the Restructuring Means

AHS wants to simplify its structure and accelerate expansion. The company is focused on creating a less fragmented experience for patients and customers, Neil Lindsay, senior vice president of AHS, told CNBC in a recent video interview. The company also wanted to reduce some layers of management and elevate tenured leaders in the company.

One Medical execs hold key roles post-reorganization. Three of the six new business units will be led by executives of One Medical, which Amazon acquired for $3.9 billion in 2023. Here’s how the new AHS units and leadership shake out:

• One Medical Clinical Care Delivery

  Andrew Diamond, M.D., Ph.D., will head the unit and oversee its medical team. Diamond was previously One Medical’s chief medical officer and joined the medical venture in 2007.

• One Medical Clinical Operations and Performance

  Suzanne Hansen will lead the group, which is charged with unifying One Medical’s care delivery models and overseeing revenue cycle management. Since 2022, Hansen led the company’s senior services as chief Medicare program officer.

• AHS Strategic Growth and Development Network

  Johnny Singerling will oversee the group and build third-party services for patients. In January he was named to lead One Medical’s commercial office, after joining the company in 2019 as chief network officer.

• AHS Store, Tech and Marketing

  Prakash Bulusu will oversee the unit, which will develop products and technology for One Medical, and will lead marketing and development for pay-per-visit services. Since 2022, Bulusu was vice president of Amazon Health Tech.

• AHS Pharmacy Services

  John Love will oversee the business unit after serving as vice president of Pharmacy and Pill Pack since 2022.

• AHS Compliance

  Kim Otte will oversee compliance risk management, billing compliance and privacy after serving as chief compliance officer for Amazon Healthcare since 2022.

Executive losses preceded the restructuring. Vin Gupta, M.D., formerly chief medical officer for Amazon’s pharmacy division, left the company in February followed two months later by Trent Green, who was CEO of One Medical, Amazon’s primary care team. Aaron Martin, vice president of health care at Amazon, announced internally last month that he plans to leave his role. Sunita Mishra, M.D., Amazon’s chief medical officer, also departed in May.

Meanwhile, PillPack founders TJ Parker and Elliot Cohen, who left Amazon in 2022, recently launched a new health care marketplace called General Medicine that will compete with Amazon. Mishra confirmed to STAT+ that she advised the nascent startup.

3 Takeaways from the Restructuring

1 | Expect pharmacy to remain a primary focus for growth.

The tech giant has opened more pharmacies in U.S. cities, launched free drone delivery of medications and made agreements with pharmaceutical firms to accept manufacturers' coupons — all to increase medication purchasing through its platform. In addition, last month Amazon Pharmacy and Serve You Rx, a pharmacy benefit manager, announced a home-delivery services agreement on maintenance medications.

2 | Don’t expect immediate results.

Changes may be incremental, with Lindsay noting that if AHS can stack changes and improve access to convenient and affordable medications, it could save them significant time, money and even lives, and “it will feel like a reinvention.” Measuring the financial impact could be difficult for outsiders since Amazon doesn’t share financials for its health businesses, notes the CNBC report. Nevertheless, Lindsay says AHS is showing strong growth across its offerings.

3 | Keep an eye on how Amazon’s bench talent performs.

Even with the previously mentioned recent leadership departures, AHS has a deep roster of long-tenured health care leaders in the organization. It will be worth watching to see what changes they make to care offerings and to build on Amazon’s deep relationships with consumers.