Decmeber 28, 2022
Health Care Market Oversight
Transaction 005
Amazon & One Medical
30-Day Review Summary Report
30-Day Review Summary Report – 005 Amazon-One Medical 2
About this Report
This report summarizes analyses and findings from Oregon Health Authority’s preliminary (30-day)
review of the proposed material change transaction of Amazon and One Medical. It accompanies
the Findings of Fact, Conclusions of Law, and Final Order (“Preliminary Review Order”) issued by
Oregon Health Authority on December 28, 2022. For legal requirements related to the proposed
transaction, please reference the Preliminary Review Order.
You can get this document in other languages, large print, braille or a format you prefer free of
charge. Contact us by email at hcmo[email protected]regon.gov or by phone at 503-385-5948. We
accept all relay calls.
If you have any questions about this report or would like to request more information, please
contact hcmo.info@oha.oregon.gov.
Contents
Contents .......................................................................................................................................... 2
Executive Summary ........................................................................................................................ 3
Introduction ..................................................................................................................................... 5
Proposed Transaction ..................................................................................................................... 6
One Medical’s Model of Primary Care ........................................................................................... 14
Findings & Potential Impacts ......................................................................................................... 18
Conclusions ................................................................................................................................... 44
Acronyms & Glossary .................................................................................................................... 46
Appendix A: OHA’s Review ........................................................................................................... 47
References .................................................................................................................................... 49
30-Day Review Summary Report – 005 Amazon-One Medical 3
Executive Summary
The Health Care Market Oversight (HCMO) program reviews proposed heath care business deals
to make sure they support statewide goals related to cost, equity, access, and quality. After
completing a review, the Oregon Health Authority (OHA) issues a decision about whether a
business deal, or transaction, involving a health care company should proceed. On November 29,
2022, OHA received a completed Notice of Material Change Transaction (the “Notice”) from
Amazon.
Proposed Transaction
In this transaction, Amazon plans to purchase One Medical for approximately $3.9 billion. One
Medical is a for-profit primary care organization operating more than 180 medical offices across the
country, including five primary care clinics in Oregon. Amazon is a multi-national corporation that
operates across several industries, including e-commerce, infrastructure computing services,
electronic devices, digital media content and logistics. In Oregon, One Medical partners with
Providence Health & Services to support clinical care and administrative services.
OHA’s Review
OHA conducted a 30-day preliminary review of the proposed transaction. During the review, OHA
gathered background information about the companies involved and assessed the likely impact of
the transaction across four domains: cost, access, quality, and equity. OHA held a 14-day public
comment period and received 36 public comments. Most public comments opposed the
transaction, with many citing concerns about for-profit health care companies prioritizing profits
over patients.
Key Findings
Cost
OHA does not have concerns about price increases resulting from
consolidation, as the transaction will not meaningfully change Amazon
and One Medical’s market share for primary care services in Oregon.
Commercial insurance payment rates for One Medical are negotiated
through the partnership with Providence. OHA has no reason to believe
that One Medical will be able to negotiate higher rates because of this
transaction.
Access
OHA does not have specific concerns about reductions in access to care
resulting from this transaction. The entities have stated that they do not
plan to reduce access to essential services. The entities have also stated
that they plan to expand One Medical’s network of clinics, which may
provide additional access to services. One Medical clinics are located in
urban areas with many other primary care providers.
Quality
OHA has limited insight into quality for One Medical locations, since its
Portland clinics opened in 2020 and 2021 and One Medical does not
participate in some programs that require regular quality reporting.
Amazon’s business model also has the potential to impact quality. OHA
will require on-going quality reporting to monitor for concerns.
30-Day Review Summary Report – 005 Amazon-One Medical 4
Equity
OHA identified potential equity concerns resulting from this transaction.
This transaction could potentially result in One Medical siphoning off
commercially insured patients with higher payment rates from clinics that
serve more Medicaid and Medicare-covered patients. Those concerns
are somewhat mitigated by the fact that One Medical has a small
footprint in Oregon and operates in urban areas with many other primary
care provider options.
Conclusions and Decision
Based on preliminary review findings, OHA approved this transaction with conditions on
December 28, 2022. (See the review order for more details.) OHA made this decision based on
these criteria:
1. The transaction is unlikely to substantially reduce access to affordable health care in
Oregon. In the locations where One Medical operates in Oregon, patients have many other
options to access similar types of services. OHA does not anticipate that this transaction
will result in increased prices. Combining with Amazon, with its advanced supply chain and
purchasing power, may generate efficiencies and savings for One Medical, though any
savings would not necessarily be passed to consumers.
2. Comprehensive review of the material change transaction is not warranted given the
size effects of the transaction. One Medical currently operates five clinics in the Portland
Metro area. One Medical’s patients represent a small number of primary care patients in the
Portland Metro region and the transaction does not impact other geographic areas in the
state.
This transaction is approved on the condition that Amazon and/or One Medical report information
about the services they provide, the patients they serve, quality of care, and any governance or
organizational changes for the locations in Oregon. The reports are required to be submitted every
six months for five years following the transaction.
OHA will monitor the impact of the transaction by conducting follow up analyses one year, two
years, and five years after the business deal is completed. During these reviews, OHA will analyze
the impact of the transaction on quality of care, access to care, affordability, and health equity,
specifically following up on concerns or observations noted in the review summary report. OHA will
also assess whether the parties to the transaction have kept to the commitments stated in the
Notice regarding cost, access, and quality of care.
30-Day Review Summary Report – 005 Amazon One Medical 5
Introduction
In 2021, the Oregon Legislature passed House Bill 2362, giving the Oregon Health Authority (OHA)
the responsibility to review and decide whether some transactions involving health care entities
should proceed. In March 2022, OHA launched the Health Care Market Oversight program
(HCMO). This program reviews proposed health care transactions such as mergers, acquisitions,
and affiliations to ensure they support statewide goals related to cost, equity, access, and quality.
The HCMO program is governed by Oregon Revised Statute (ORS) 415.500 et seq. and Oregon
Administrative Rules (OAR) 409-070-0000 through -0085. The HCMO program fits within OHA’s
broader mission of ensuring all people and communities can achieve optimum physical, mental,
and social well-being through partnerships, prevention, and access to quality, affordable health
care.
In the authorizing statute, the Oregon Legislature specified what types of proposed transactions
are subject to review and the criteria OHA must use when analyzing a given proposed transaction.
The Oregon Legislature also authorized OHA to decide the outcome of a proposed transaction.
After analyzing a given proposed transaction, OHA may approve, approve with conditions, or reject
it.
When reviewing transactions, HCMO focuses solely on analyses within the scope of the program’s
authority. Certain other analyses do not fall within the HCMO program’s scope of review.
What is in HCMO’s scope
Compliance with ORS 415.500 et seq, and
accompanying administrative rules
How the proposed transaction affects competition
and market concentration
How the proposed transaction affects access to care
How the proposed transaction affects health equity,
including rectifying current and historical factors that
drive inequities
How the proposed transaction affects the quality of
health care
30-Day Review Summary Report – 005 Amazon One Medical 6
Proposed Transaction
On November 29, 2022, OHA confirmed receipt of a complete Notice of Material Change
Transaction (the “Notice”) from Amazon.com, Inc. (“Amazon”). This Notice describes a proposed
transaction where Amazon will merge with 1Life Healthcare, Inc. (“One Medical”) and Negroni
Merger Sub, Inc. (“Merger Sub”). The Notice outlines the intent of Amazon to merge with One
Medical.
OHA reviewed the Notice and determined that the transaction is subject to review under HCMO
rules. The parties to the proposed transaction meet the revenue thresholds specified in OAR 409-
070-0015(1) and the proposed transaction is otherwise covered by the program in accordance with
OAR 409-070-0010. After confirming receipt of the complete Notice, OHA began a 30-day
preliminary review of the proposed transaction. OHA accepted public comments on this transaction
from November 29, 2022, through December 14, 2022.
This report describes the proposed transaction, OHA’s approach to the review, its findings, and its
conclusions based on these findings.
Entities Involved
The main entities involved in this transaction are Amazon and One Medical. Although not a party to
the transaction, Providence Health & Services Oregon has a partnership with One Medical to
deliver care in Oregon and is included below.
Amazon
Amazon is a multinational technology company
focusing on e-commerce, cloud computing, online
advertising, digital streaming and media content,
electronic devices, and artificial intelligence.
Amazon is a publicly traded, for-profit company,
incorporated in Delaware and headquartered in
Seattle, WA.
Amazon organizes operations into three
segments: North America, International, and
Amazon Web Services (AWS). AWS offers “a
broad set of on-demand technology services,
including compute, storage, database, analytics,
and machine learning, and other services.”
1
Amazon operates online and physical stores, as
well as a platform where third parties can sell
products and operate businesses online. Amazon
also has fulfillment networks throughout the world to process, ship, and deliver products to
customer.
In 2021, Amazon reported:
2
• 1,608,000 full-time and part-time employees, making it the second largest private employer
in the United States.
• $469.8 billion in net sales and $33.4 billion in net income
• Approximately 200 million Amazon Prime members
3
We seek to be Earth’s most customer-
centric company.
We are guided by four principles:
customer obsession rather than competitor
focus, passion for invention, commitment
to operational excellence, and long-term
thinking. In each of our segments, we
serve our primary customer sets,
consisting of consumers, sellers,
developers, enterprises, content creators,
advertisers, and employees.
- Amazon 2021 Annual Report SEC Filing
30-Day Review Summary Report – 005 Amazon One Medical 7
Amazon has made several efforts to expand into
health care, often with mixed results. A common
stated goal across Amazon’s health care efforts
has been to make health care more convenient
and accessible for consumers.
4
The One Medical
deal would be Amazon’s largest health care
acquisition to date.
PillPack and Amazon Pharmacy
In 2018, Amazon acquired PillPack, an online Pharmacy service focused on recurring monthly
medications, for $750 million. Amazon currently operates PillPack as a distinct service for
customers managing multiple daily medications for chronic conditions.
PillPack became the foundation for Amazon Pharmacy, an online pharmacy service that Amazon
launched in 2020, promising low prices, convenience, and quick delivery.
5
Amazon Prime
members receive free two-day delivery on Amazon Pharmacy prescriptions. Neither Amazon
Pharmacy nor PillPack are authorized to ship Schedule II medications, such as opioids.
Amazon also offers an Amazon Prime prescription savings benefit, which advertises discounts of
up to 40% off brand name drugs and 80% off generic drugs for Amazon Prime members that pay
without using insurance. The Amazon Prime prescriptions savings benefit includes a digital Rx
card that Prime members can use for savings at participating pharmacies, including CVS, Rite Aid,
and Fred Meyer, among others. This benefit is automatically included in Amazon Prime
memberships.
6
Since its launch, Amazon Pharmacy has had fairly low use among Amazon Prime members. One
survey found that 2% of Prime members use Amazon Pharmacy, compared with 73% who use
two-day shipping and 58% who use Prime video.
7
Amazon Clinic
On November 15, 2022, Amazon announced the launch of Amazon Clinic, a “message-based
virtual care service that connects customers with affordable virtual care options.”
8
In their
announcement, Amazon stated a desire to “make it dramatically easier for people to get and stay
healthy.”
Amazon Clinic operates as a direct-to-consumer virtual health “storefront” where users can search
for, compare, and connect with third party providers. Patients can also pay for virtual care services
through the platform, which have a flat fee that users can see when they search for services.
Amazon Clinic is a message-based, “asynchronous” care platform; after a patient answers
questions about their condition, providers consult with patients via messages.
Amazon Clinic initially launched in 32 states, including Oregon, and offers 24/7 access to care for
common conditions, such as pink eye and urinary tract infections, as well as prescription renewals
for common medications, like high blood pressure or asthma drugs. As of this report, Amazon
Clinic does not accept health insurance for consults with providers, though patients can use
insurance to pay for prescriptions resulting from the consultation.
i
The Amazon Clinic website
includes the note that “at this time, Amazon Clinic isn’t intended for individuals who receive
i
The Amazon Clinic website includes this note: “At this time, Amazon Clinic isn’t intended for individuals who
receive coverage from federal or state healthcare payors. We encourage you to visit a covered provider who
is contracted with your health plan for services.”
We think health care is high on the list of
experiences that need reinvention.
- Neil Lindsay, SVP of Amazon Health
Services in a press release
30-Day Review Summary Report – 005 Amazon One Medical 8
coverage from federal or state healthcare payors. We encourage you to visit a covered provider
who is contracted with your health plan for services.”
Past health care efforts: Haven, Amazon Care, and HIPAA-Compliant Alexa
In 2018, Amazon launched a partnership with JP Morgan and Berkshire Hathaway to overhaul
health coverage and health care for employees of the three companies. The companies created
Haven, a non-profit joint venture focused on creating “simplified, high-quality and transparent
health care at a reasonable cost” for US employees.
9
At its launch, Amazon had expressed hopes
that Haven would disrupt the health care industry, but nonetheless abandoned the effort in 2021.
Media reports cited insufficient market power and the COVID-19 pandemic as factors that
contributed to Haven’s failure.
10
In 2019, Amazon launched Amazon Care, a primary and urgent care service for employees.
Services were primarily virtual, with some home visit and in-office options. Amazon aimed to
expand the service to other employers but was unsuccessful and, per the Notice, Amazon Care will
sunset at the end of 2022.
Also in 2019, Amazon launched HIPAA-compliant skills kit for developers for its Alexa voice
assistant devices. The goal was to allow health care organizations to build HIPAA-compliant apps
that could securely transmit protected health information. As of Dec 9, 2022, this service will no
longer be supported.
11
One Medical (1Life Healthcare, Inc.)
One Medical was founded in 2007 by a physician
turned entrepreneur. One Medical provides
primary care services to individuals who have a
membership. One Medical serves people with
commercial and Medicare insurance; as of this
report, they did not accept patients with Medicaid
insurance coverage. The company is for-profit,
publicly traded, incorporated in Delaware, and
based in San Francisco. One Medical announced
its initial public offering (IPO) in 2020. According to
its website, One Medical has 200+ locations in 29
markets nationwide.
One Medical builds memberships by marketing
directly to consumers and by partnering with
employers who offer One Medical membership as
a benefit. Around 60% of members are through
employers or enterprise clients.
12
Technology is
central to One Medical’s approach to offer 24/7 on-
demand digital and virtual care options. They have
built a proprietary technology platform and electronic health records system. As of December 2020,
the company reported five times as many digital as in-person encounters.
13
One Medical partners
with established health systems in local markets to deliver care and provide access to specialty,
hospital, and other non-primary care services. Through these partnerships, One Medical is able to
integrate into existing networks, rather than building their own, and leverage existing relationships
with insurers. These partnerships are a crucial component of One Medical’s model. In One
Medical’s 2021 Annual Report, they stated: “Our business model and future growth are
substantially dependent on the success of our strategic relationships with health network partners,
enterprise clients and distribution partners.”
14
One Medical is a membership-based
primary care practice on a mission to
make getting quality care more affordable,
accessible, and enjoyable for all through a
blend of human-centered design,
technology, and an exceptional team. Our
members enjoy seamless access to
comprehensive care at calming offices
near where they work, live, and shop in
twelve major U.S. markets, as well as 24/7
access to virtual care. In addition to a
direct-to-consumer membership model, we
work with more than 8,000 companies to
provide One Medical health benefits to
their employees.
- One Medical website
30-Day Review Summary Report – 005 Amazon One Medical 9
One Medical’s Partnership with Providence
In Oregon, One Medical partners with Providence Health & Service Oregon to deliver clinical care
and bill for services. One Medical also refers to Providence facilities and providers for hospital,
specialty, and other non-primary care services.
Providence Health & Services Oregon is part of Providence St. Joseph Health, a non-profit, tax
exempt, Catholic health care system operating in seven states and including more than 50
hospitals, 800 non-acute locations, home health services, and health plans. Providence operates
eight hospitals in Oregon and Providence Medical Group operates more than 90 clinics with 600
employed physicians. In Oregon, Providence Health Plan offers commercial, self-insured,
individual and group, Medicare, and Medicaid insurance.
15
In 2019, One Medical and Providence entered into a partnership in advance of One Medical
opening primary care locations in Oregon. The partnership covers clinical, administrative, and
payment services. Through this partnership One Medical patients can be referred to Providence
specialists and facilities. One Medical bills for its clinical services under a Providence National
Provider Identifier (NPI) and Providence retains all fees for the professional and clinical services
provided. Providence pays One Medical a per member per month payment, which may be adjusted
to consider various factors.
Amazon described this relationship in more detail in the Notice:
Under its strategic partnership with Providence Health & Services Oregon (“Providence”),
Providence contracts with One Medical Group, Inc. for professional clinical services and
separately contracts with 1Life for management, operational and administrative services. All
professional clinical services are billed under a Providence NPI and Providence retains all fees
for the professional clinical services provided. Providence pays each of 1Life and One Medical
Group, Inc. on a “per member per month basis”, and such payment may be adjusted based on
various factors such as visit rates, other primary care relationships the health system has, and
the rates the health system receives from payers.
Governance
In this report, “One Medical” refers to entities doing business under the One Medical brand,
including 1Life Healthcare, which provides administrative and management services, and One Life
Medical Group, Inc., physician owned professional corporations that are affiliated with One Medical
and deliver clinical services.
Currently, One Medical is governed by a 10-member board of directors.
16
The board of the
directors provides oversight, strategic guidance, counseling, and direction to One Medical’s
management. The board includes two physicians, representing a pharmaceutical company and
health care investments company. Other board members have backgrounds in cybersecurity,
childcare, retail clothing and beverages, venture capital, and private equity. Aside from the board
chair and CEO, no board members appear to have a background in primary care. Members are
elected for three-year terms. In 2021, non-employee board members were paid between $27,475
and $271,776 in cash and stocks.
17
30-Day Review Summary Report – 005 Amazon One Medical 10
Growth and expansion
One Medical has expanded rapidly
in the past few years, growing from
about 70 clinics and 300,000
members in 2018 to 200 clinics and
815,000 members nationally in
2022.
18
19
One Medical began
operating clinics in Oregon in 2022.
Along with this rapid growth, One
Medical has not yet proven to be
profitable. The company has
consistently reported operating
losses, including $117.3 million in
losses for the third quarter of 2022.
20
The company has stated its intent to
continue to pursue growth, seeking
to transform and disrupt health care
in the process. In its 2021 annual
report, One Medical outlined its
strategies for continued growth and
expansion:
• Grow in existing markets
through increasing consumer
memberships, gaining new
enterprise clients, and
expansion of Medicare
Advantage payers and
members
• Expand into new markets
• Grow health network partnerships, including moving into markets where existing partners
have an established presence.
• Expand services and populations to provide care for members across all stages of life
One Medical mergers and acquisitions history
In 2021, One Medical acquired Iora Health, a value-based primary care group serving Medicare
patients at 47 offices in ten markets across the US. This was an opportunity for One Medical to
move into the large and growing Medicare market: “By acquiring Iora, we’ll be able to better
address the needs of Medicare patients, an important step in our mission to transform healthcare
for all.”
21
Iora is now branded as “Iora with One Medical,” but its website notes that it is transitioning
to become One Medical Seniors. According to the One Medical 2021 Annual report, the company
states that the acquisition of Iora Health “extends reach across locations representing 40% of the
U.S. population.”
22
This map below shows One Medical and Iora Health markets, with * indicating upcoming markets.
69
71
83
107
Iora Health
acquisition
182
214
0
50
100
150
200
250
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
2018 2019 2020 2021 2022
One Medical more than tripled its number of clinics
nationally from spring 2018 to fall 2022
-
300,000
600,000
900,000
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
2018 2019 2020 2021 2022
The number of One Medical members nationally more
than doubled between spring 2018 and fall 2022
30-Day Review Summary Report – 005 Amazon One Medical 11
According to media reports, prior to entering the deal with Amazon, One Medical considered and
rejected acquisition interest from CVS Health.
23
Transaction Terms
On July 20, 2022, Amazon entered into an Agreement and Plan of Merger (“Merger Agreement”)
with 1Life Healthcare, Inc. and Negroni Merger Sub, Inc. (“Merger Sub”), a wholly owned
subsidiary of Amazon. Terms of the Merger Agreement include:
• Merger Sub will be merged with and into 1Life Healthcare. 1Life Healthcare will be the
surviving corporation in the merger and will become a wholly owned subsidiary of Amazon.
• At the Effective Time (as defined in the Merger Agreement), each share of 1Life Healthcare
common stock issued and outstanding immediately prior to the Effective Time (other than
dissenting or excluded shares) will be automatically converted into the right to receive $18
in cash.
• Amazon will provide loan of up to $300 million to 1Life Healthcare. Funds will be provided
as monthly payments of $30 million starting in March 2023 and until the close of the merger
or termination of the Merger Agreement, whichever comes first.
24
Amazon further clarifies in the Notice that the physician owned One Medical Professional Entities
are not party to the agreement. 1Life Healthcare does not have any ownership interest in these
professional entities, and the transaction will not change their current ownership. The transaction is
valued at approximately $3.9 billion, including net debt of 1Life Healthcare.
Rationale for the Transaction
The Notice describes the merger as an opportunity for Amazon to advance the mission of One
Medical:
Through One Medical, Amazon sees an opportunity to further One Medical's mission to
make quality care more affordable, accessible, and enjoyable through a combination of in-
30-Day Review Summary Report – 005 Amazon One Medical 12
person, digital, and virtual health care services that are convenient to where people work,
shop, and live.
In press releases and other public statements, Amazon and One Medical executives have
presented the merger as a way to transform or “disrupt” health care through innovation, technology
and focusing on the patient experience. A representative of Amazon Health Services described
health care as “high on the list of experiences that need reinvention.”
25
As described above, Amazon has made various
efforts to enter the health care space, with mixed
results. By acquiring an established network of
primary care clinics with a pre-existing customer
base, they will quickly obtain a nationwide foothold
in primary care. Press coverage has also noted
that Amazon could offer its other products and
services to One Medical’s clients and patients,
such mail-order pharmacy (PillPack/Amazon
Pharmacy), nutritious food (Whole Foods and
Amazon Fresh) and wearable technology (e.g.,
smartwatches and activity trackers), possibly using
medical information to offer recommendations
(although it would need to comply with HIPAA
requirements).
26
Analysts have commented that One Medical likely sees the merger as a way to stabilize its
financial situation by raising capital. (We discuss the potential impact of the transaction on One
Medical’s financial condition below.) The company has consistently lost money, and its stock price
has dropped significantly in the last 18 months. With Amazon’s financial backing and data
expertise, One Medical may be in a stronger position to compete with other primary care groups
and grow its Medicare Advantage business.
27
Post-Transaction Plans
Following the close of the transaction, Amazon
plans to maintain 1Life’s and One Medical Group,
Inc.’s leadership teams, including 1Life’s current
CEO. Per the Notice, current members of 1Life’s
board of directors will step down, leaving CEO
Amir Dan Rubin as the sole board member.
Despite public statements about disruption and
reinvention of health care, the Notice states that
Amazon and One Medical “do not expect the
proposed transaction to result in a change in
health care services.”
Amazon further says in the Notice that it expects to
retain One Medical employees and contractors
following the close of the transaction. It also plans
to expand One Medical’s network of clinics and
make investments in technology and services to
improve access to health care services and reduce
One of the things we’re trying to do at One
Medical is say, we would love to serve
everyone, regardless of choices.
So imagine a world where we can serve
you when you’re young through our
pediatrics programs. And then you start
getting your first job and work for an
employer who’s paying for One Medical.
You happen to leave that employer, you
can pay a membership fee yourself. You
become a senior, you join a plan, we serve
you. If you decide not to join a plan, we
can serve you in direct contracting.
- Rushika Frenandopulle, One Medical
CIO
The opportunity to transform health care
and improve outcomes by combining One
Medical’s human-centered and
technology-powered model and
exceptional team with Amazon’s customer
obsession, history of invention, and
willingness to invest in the long-term is so
exciting
- Amir Dan Rubin, One Medical’s CEO, in
a press release
30-Day Review Summary Report – 005 Amazon One Medical 13
costs. Amazon asserts in its Notice that it has no intention of restricting services available to One
Medical patients:
Amazon does not intend to restrict or otherwise reduce the scope of professional medical
services delivered by the One Medical Professional Entities. Amazon also has no intention
of limiting any patient’s freedom of choice with respect to pharmacy, specialty care, or other
health services.
Federal Review of the Amazon-One Medical Transaction
The Federal Trade Commission (FTC) is currently reviewing the merger. Federal law (the Hart-
Scott Rodino Antitrust Improvements Act of 1976) requires companies to notify the FTC and the
U.S. Department of Justice of certain large transactions before they occur. Hart-Scott Rodino
reviews generally examine the effect of the transaction on competition.
Amazon and One Medical filed notification of their intent to merge on August 3, 2022. On
September 2, 2022, they received a request for additional information and documents from the
FTC for purposes of its review. Both parties said they expected to respond “promptly” to the
request and “continue to work cooperatively with the FTC.”
28
Once Amazon and One Medical have
provided all the requested information and documents, the FTC has 30 days to review the
transaction before it is allowed to close.
Following the merger’s announcement in July 2022, various groups urged the FTC to launch an
investigation. Concerns raised included:
29
• Amazon’s ability to leverage its dominant position in the online retail market to gain an
unfair advantage in the health care market.
• The possibility that Amazon could misuse patients’ personal health data to enhance sales
of its other products and services, leading to privacy and antitrust violations.
• The risk that Amazon-One Medical will grow by “cherry picking” healthier, more affluent
patients, leaving other providers to care for sicker, less well-insured patients and
exacerbating health inequities.
• Quality of care at One Medical could decline under Amazon due to over-reliance on virtual
care and focus on generating cost efficiencies.
• Deterioration of working conditions at One Medical given Amazon’s poor track record of
respecting workers’ rights.
In a letter to the FTC, Senator Amy Klobuchar raised concerns about anticompetitive effects
resulting from Amazon’s potential access to health care data and from Amazon’s existing
presence in pharmacy.
30
She also highlighted Amazon’s history of engaging in “business practices
that raise serious anticompetitive concerns,” citing a 2020 report from the House Judiciary
Committee.
31
The report found that Amazon has engaged in extensive anticompetitive conduct in
its treatment of third-party sellers that use Amazon to reach online customers. Amazon has been
involved in multiple antitrust lawsuits and regulatory investigations in the U.S and elsewhere in
connection with its treatment of rival sellers on the Amazon storefront.
32
OHA’s review did not address potential implications of the transaction for data privacy or workers’
rights, as these are outside the scope of HCMO’s statutory authority. We discuss other concerns
described above as they may relate to Oregon in the analysis of potential impacts on
consolidation, cost, access, quality, and health equity.
30-Day Review Summary Report – 005 Amazon One Medical 14
One Medical’s Model of Primary Care
What is primary care?
Primary care provides a range of prevention and wellness services, as well as treatment for
common illnesses and conditions. Primary care providers include physicians, nurses, nurse
practitioners, and physician assistants who help patients manage day-to-day health needs. Primary
care providers often maintain regular, long-term relationships with patients and may coordinate
care with other providers and specialists. Through regular check-ins, primary care providers play a
crucial role in preventing health problems, identifying issues early, and getting treatment sooner.
There are many different models that provide primary care and adjacent services. Models differ in
the types of services provided, as well as how payments are structured.
Primary Care Model
Description
Medical home (also called patient-
centered medical home)
Team-based care designed to manage a patient’s overall physical
and behavioral health needs and coordinate care across different
providers. Medical homes generally accept most types of insurance.
Medical homes often have expanded hours and/or offer messaging
tools for patients to connect with providers.
Direct primary care (also called
direct patient contracting)
Patients pay a monthly fee directly to providers to access most typical
primary care services. Direct Primary Care providers may advertise
having shorter wait times for appointments, more access to
physicians, or unlimited primary care services included in the monthly
fee. Providers generally don’t bill insurance for services.
Concierge medicine
Patients pay a monthly retainer or fee to access care. Concierge
providers may bill insurance, and advertise easy, quick access to
providers and longer appointment times.
On-demand care (also called
express care)
Express care clinics are designed to treat mild illnesses or injuries for
patients who need to be seen soon but are unable to visit a primary
care provider. These clinics provide same-day or walk-in
appointments, often with extended hours on weekends and
weekdays.
Urgent care
Urgent care treats non-life-threatening illness and injury that needs to
be addressed as soon as possible (such as stitches or flu symptoms).
Urgent care is often has extended hours and may cost more than
express care but is less expensive than the emergency room.
30-Day Review Summary Report – 005 Amazon One Medical 15
How One Medical delivers care
One Medical is a membership-based primary care provider that
combines aspects of other primary care models like concierge
medicine, on-demand care, and direct primary care. One Medical
advertises key elements of their model:
33
• Same day appointments and 24/7 access to care via in-
person and virtual care
• Proprietary technology tools
• On-site laboratory services
• Conveniently located and attractively designed offices
• Partnerships with established health networks to provide
access to specialty care and insurance plans
• Memberships can be for individuals or as a benefit offered
by employers
One Medical is seeking to transform health care and address
current issues in the health care system. One Medical has
designed its primary care model to address key issues and
opportunities for improvement in the current health care system:
34
• Consume dissatisfaction with long wait times, lack of
access to providers, limited after-hours appointments,
short visits with providers, and lack of care coordination
• Employers find health benefits offerings do not support
objectives such as engaging employees, improving
employee productivity, reducing absenteeism, producing
better health outcomes, increasing safety of the workplace,
or managing health care costs.
• Providers experience burnout, driven by misaligned fee-
for-service compensation, excessive administrative and
electronic health record (EHR) tasks, and convoluted
insurance procedures.
Patients
One Medical focuses on patients who live in urban areas and
have commercial and Medicare coverage. One Medical serves
patients of all ages, though not every clinic has providers that
serve patients at all stages of life. In Portland, for example, the
Cedar Hills and Tigard clinics see all ages; other clinics serve
patients 18 and older.
35
One Medical also seeks agreements with employers to offer One
Medical as a benefit and about 60% of members have their
membership paid by an employer.
36
Members can also pay out of
pocket, but as of this report, they do not accept Medicaid
insurance. (In Oregon, Medicaid is called the Oregon Health
Plan.)
We have developed a
modernized healthcare
membership model based on
direct consumer enrollment and
third-party sponsorship across
commercially insured and
Medicare populations. Our
membership model includes
seamless access to 24/7 digital
health services paired with
inviting in-office care routinely
covered by most health care
payers…
Our digital health services and
our well-appointed offices, which
tend to be located in highly
convenient locations, are staffed
by a team of clinicians who are
not paid on a fee-for-service
basis, and therefore free of
misaligned compensation
incentives prevalent in health
care. Additionally, we have
developed clinically and digitally
integrated partnerships with
health networks, better
coordinating more timely access
to specialty care when needed
by members. Together, this
approach allows us to engage in
value-based care across all age
groups, including through At-
Risk arrangements with
Medicare Advantage payers and
CMS, in which One Medical is
responsible for managing a
range of healthcare services and
associated costs of our
members.
- One Medical Q2 2022 Report
30-Day Review Summary Report – 005 Amazon One Medical 16
As of September 30, 2022, One Medical had 815,000 members, of which 40% were at-risk.
37
For
“at-risk” members, One Medical is responsible for managing a range of health care services under
a capitated or per member per month contract.
ii
One Medical also has consumer and enterprise
members, defined as people who registered with and paid for a membership with One Medical or
whose membership has been sponsored by an enterprise, employer, or third party.
Services
One Medical offers in-person, video, and message-based interactions with providers.
Physical health
One Medical advertises a range of primary care services, including wellness and prevention,
everyday care, chronic conditions, children and family, mental health, LGBTQIA+ services, urgent
care, and sexual health care. Some of their services have specific branding. For example, Impact
is a program to manage chronic conditions that features a team-based approach, patient-centered
plan, coaching and group classes, specialist care with health system partners, and technology
platform that can connect to devices.
38
Mental health
One Medical integrates mental health care into primary care. According to their website: “We’re
confident our primary care providers can handle most things that come in the door… If you need or
want more specialized care, we have a curated referral network of therapists and psychiatrists who
we know and trust that we can send you to.”
39
They also offer virtual therapy and coaching through
video session and, in some areas, group programs.
Workplace programs
One Medical offers return to workplace programs for employers that can be tailored to include
services such COVID testing and screening, workplace safety protocols, and employee
communication resources.
Health System Partnerships
When One Medical enters a new geographic market, they typically partner with an existing large
health system operating in the area. These strategic partnerships allow One Medical to integrate
into existing networks of providers and insurers. Partnerships support clinical care, referrals, and
reimbursements from insurance companies. In Oregon, Washington, and Southern California,
Providence is One Medical’s partner health system. Other partners include Dignity Health in
Phoenix, Emory Healthcare in Atlanta, and Mount Sinai in New York City. In the Notice, Amazon
states:
In many of its geographic areas, including Oregon, One Medical partners with an area
health system to offer One Medical members a clinically integrated care delivery network
that improves care coordination, increases access to specialist physicians, and reduces
costs… These partnerships with health systems are a cornerstone of One Medical’s
business model as they advance more seamless member access to partner specialists and
facilities when needed, while supporting reductions in duplicative testing and excessive
delays often seen across uncoordinated healthcare settings.
ii
With capitated payments, a provider receives an amount of money for each patient attributed to them for a
designated period of time, regardless of how many services the patient seeks or receives.
30-Day Review Summary Report – 005 Amazon One Medical 17
Payments
One Medical currently accepts commercial insurance and Medicare. In Oregon, One Medical
accepts many major commercial health insurance plans, including Aetna, Cigna, Providence,
United Healthcare, Moda, and others. One Medical also accepts Medicare Part B (also known as
original or fee-for-service Medicare) but does not currently accept any Medicare Advantage plans.
In some other markets, such as Phoenix and New York, One Medical accepts Medicare
Advantage.
40
One Medical executives have expressed a “huge interest” in accepting Medicaid
coverage but cite structural barriers such as high volume of churn among Medicaid patients and
state budgeting practices.
41
In its Q2 2022 quarterly report, One Medical describes two main buckets of revenue: Medicare and
commercial.
42
For capitated payments, per-member per-month amounts may be adjusted based on the member’s
health status.
iii
Capitated revenue represented 98% of One Medical’s Medicare revenue and 50%
of total net revenue for the three months ending September 30, 2022.
43
For the three months
ending September 30, 2022, partnership and membership revenue together accounted for 72% of
commercial revenue.
44
One Medical notes in its financial reporting that its revenues have
historically been concentrated among a small number of customers. In 2021, the top three
customers (commercial payers and a health network partner) accounted for 32% of the company’s
net revenue.
45
One Medical’s 2021 annual report also mentions that One Medical participates in the Centers for
Medicare and Medicaid Services (CMS) direct contracting program:
We are one of a select group of companies that participate in the Direct Contracting
Program, which is an initiative with a new payment model in which CMS contracts directly
with provider-entities designated by CMS as Direct Contracting Entities. As a result, we
have an opportunity to expand our Direct Contracting service offering to new geographies
over time.
iii
Capitated revenue comes from at-risk arrangements with Medicare Advantage plans, where One Medical
receives a per-member per-month payment to manage a range of health care services for members.
Partnership revenue includes per-member per-month received from contracts with health system partners
and revenue from enterprise contracts, where One Medical receives a fixed price per employee. Net fee-for-
service revenue consists mainly of fee-for-service reimbursements from insurance plans or members based
on contracted rates. Membership revenue consists of annual membership fees paid by consumer
(individual) or corporate (enterprise) clients.
Medicare Revenue
51%
Commercial Revenue
49%
Partnership
revenue
25%
Fee-for-
service
14%
Membership
revenue
10%
Capitated
revenue
50%
Fee-for-
service/other
1%
Total Net Revenue
$261.4 million
30-Day Review Summary Report – 005 Amazon One Medical 18
Findings & Potential Impacts
OHA compiled available data and information to understand and examine the potential impacts of
the transaction across four domains: access, cost, quality, and equity. To assess the potential
impacts of the proposed transaction on Oregon residents’ equitable access to affordable care,
OHA considered transaction terms, market characteristics, statements made by the entities, public
comments, and publicly available data, research, and reports.
Overview
One Medical Service Area(s)
One Medical currently has five locations in Oregon, all in the Portland metropolitan area.
• North Williams: 20 N Skidmore St, Portland, OR 97217
• Pearl: 1122 NE Everett St, Portland, OR 97209
• Downtown: 601 SW 4
th
Ave, Portland, OR 97204
• Cedar Hills: 2865 SW Cedar Hills Blvd, Beaverton, OR 97005
• Tigard: 12180 SW Scholls Ferry Rd, Tigard, OR 97223
Typically, OHA uses administrative
claims data from Oregon’s All
Payer All Claims (APAC) database
to calculate a primary service area
for an entity, analyze volume of
visits, and present a profile of
patient demographics and payer
mix. For One Medical, APAC data
represent only about 25% of the
volume reported by the entities;
therefore, OHA could not perform
these analyses to look at One
Medical services, patients, and
payments. This lack of data is likely
due to One Medical serving many
patients who have employer self-
insured plans or pay out of pocket,
neither of which are required to
submit data to APAC.
Instead, we defined the service
area for this transaction as all zip
codes within 10 miles of the five
One Medical locations, excluding
zip codes in Washington State. Zip
codes are represented as the
darker gray areas in map. These zip codes are primarily located in Multnomah, Washington and
Clackamas counties.
Data from the American Community Survey (ACS) 2020 five-year population estimates suggest
that 1.4 million people reside in this area.
One Medical’s service area in Oregon includes zip
codes in Clackamas, Multnomah, and Washington
counties.
30-Day Review Summary Report – 005 Amazon One Medical 19
Equitable access to primary care services in any given region is impacted by the social and
economic characteristics of the local population. Barriers to access systematically exist for people
who are non-White, non-English speaking, older and lack health insurance. Understanding the
profile of the regional population allows us to determine how well a provider is responding to the
needs of the community and serving a representative patient population. One Medical clinics are
mostly located in areas of greater economic affluence in the region and their patient population is
predominantly commercially insured and employed, younger (and therefore more likely to be
healthy) and White. Socio-economic characteristics vary across this Portland service area, with
notable variation in the zip codes of One Medical locations.
Race and spoken languages
About 25% of this population are
people of color and 3% reported
speaking English less than very
well. In the zip code where Cedar
Hills One Medical is located, 17%
of residents identify as speaking
English less than very well. Zip
codes to the west of this location
also have higher rates, ranging
from 8% to 12% of the residents.
Age groups
Roughly 41% of residents in the
service are between ages 35 and
64; however, this varies by zip code,
with a concentration of younger
adult residents (aged 20 – 34) in the
zip codes surrounding the North
Williams, Pearl and Downtown One
Medical locations. Children under
19 are mostly likely to be covered
by Medicaid.
21%
24%
41%
14%
<19 19 - 34 35 - 64 65+
In One Medical's service area, 41% of the overall
population is ages 35-64.
Portion of the population living in One Medical’s service
area that speaks English less than “very well.”
30-Day Review Summary Report – 005 Amazon One Medical 20
Insurance coverage
The vast majority of residents in
the One Medical service area
have health insurance, but rates
and types vary by age group.
Most individuals under age 65
have a single type of insurance
coverage, predominantly
employer based. The population
aged over 65 is more likely to
have multiple types of insurance
coverage, most frequently
including Medicare. Adults aged
19 – 34 have the highest rate of
uninsurance (10%).
Children under 19 have the highest
rates of Medicaid coverage, while
adults ages 35-64 have the highest
rates of commercial coverage.
Residents ages 19-64 make up
65% of the overall population and
77% of the population with
commercial insurance. Children
comprise 21% of the service area
population and 38% of the
population with Medicaid coverage.
Because One Medical mostly
accepts commercial insurance in
Oregon, the population they serve
is likely to be within the 19-64 years age range.
Economic factors
The estimated unemployment rate for the service area is 5%, with notable variation by age group
and geography. Unemployment for all 20 to 24 year olds is nearly double the average (9.3%), but
residents in this age group living in the zip codes surrounding the Pearl One Medical location (zip
code 97209) have particularly high rates of unemployment (18 – 21%).
The overall rate of people living below the federal poverty level in the service area is 11%, with zip
code poverty rates ranging from 3% to 55%. The Downtown Portland clinic is located in the zip
code with the highest poverty rate (55%). In this area, Black and Hispanic or Latinx residents are
more likely to live below the poverty level. In the zip code surrounding the Downtown Portland
clinic, 90% of people identifying as Black live below the poverty level.
Market Share & Consolidation
Market Share
One Medical’s membership-based primary care model has similarities to concierge medicine and
direct primary care models, and their same day access offers similar services to on-demand care
(also known as express care) and urgent care providers. Patient-centered medical home clinics
1%
7%
10%
3%
33%
86%
85%
91%
66%
7%
5%
6%
65+
35-64
19-34
<19
No Insurance One type Two or more types
Most residents in One Medical's service area have health
insurance.
38%
22%
23%
27%
31%
50%
7%
1%
Medicaid
Commercial
<19 19-34 35-64 65+
Adults ages 35-64 account for half of people with
commercial coverage in the service area.
30-Day Review Summary Report – 005 Amazon One Medical 21
and independent primary care providers also provide similar services. One Medical’s model of care
overlaps to some extent with each of these other provider types, making it difficult to quantify their
share of the market in this region.
Within One Medical’s geographic service area, there are multiple providers offering similar types of
care (see map below). Other primary care clinics following the patient-centered medical home
(PCMH) model also offer same-day appointments and urgent care hours, with priority typically
given to established patients with in-network insurance coverage. Availability of these
appointments may be more limited than at on-demand or direct primary care clinics. Oregon’s
Patient-Centered Primary Care Home (PCPCH) program has recognized 171 clinics located in One
Medical’s service area and hundreds of independent primary care physicians and private family
medicine or internal medicine practices operate in the area
46
.
As described below, many direct primary care, concierge, on-demand, and urgent care providers
operate in the same area as the five One Medical clinics. The five One Medical clinics collectively
serve a small portion of the 1.4 million residents in the area. Proximity and access to other options
for primary care and urgent care needs vary within this geography but are numerous throughout
the region.
Many Direct Primary Care, Concierge, On-Demand and Urgent Care Providers operate in the
One Medical Service Area
Horizontal Consolidation
Amazon Clinic services are also available to residents of this area, which fills a unique niche in the
spectrum of primary and urgent care. For a set visit fee, asynchronous digital consults are provided
to patients experiencing a limited number of urgent conditions that are most frequently identified
without diagnostic testing and addressed with a prescription medication. Prescriptions for
previously diagnosed chronic conditions can also be filled without the need for an in-person visit.
30-Day Review Summary Report – 005 Amazon One Medical 22
There is some overlap in the conditions treated through Amazon Clinic and those addressed
through One Medical’s services, such that the two services may compete for a very small subset of
the regional population. Amazon Clinic is available to anyone and does not accept insurance,
whereas One Medical services are for members.
Amazon Pharmacy is also available to residents of the Portland metro region. Analysis of recent
APAC data (2020 – 2021) suggest very few One Medical patients also received prescription
medication from Amazon Pharmacy. It’s worth noting that Amazon Pharmacy encourages out of
pocket payments by offering discounts. Many Amazon Pharmacy patients pay out of pocket and
are not reflected in APAC data, so there may be a larger overlap of self-pay patients that utilize
both services that we are unable to capture in our data.
Vertical Consolidation
This transaction represents a vertical consolidation in health care markets through the combination
of Amazon Pharmacy (prescription services) with One Medical (primary care services). Vertical
consolidation has the potential to reduce competition when a company leverages a significant
share of one market to disadvantage competitors in the other market, for example, by refusing to
supply the inputs (e.g., supplies) its competitors need. Because both One Medical and Amazon
Pharmacy have a small share of the markets for primary care and pharmacy services in Oregon,
respectively, OHA views the likelihood of this happening as small. Additionally, Amazon states in
the notice that it has no plans to restrict One Medical patients’ ability to choose a pharmacy other
than Amazon Pharmacy.
Competition
Amazon is a dominant player in various consumer markets outside the health sector, notably in
online retail. With the addition of One Medical, Amazon could potentially leverage that dominance
to gain an unfair competitive advantage in primary care. This concern has been raised by several
advocacy groups commenting on the transaction nationally, as well as in public comments
received by OHA (discussed below). For example, Amazon could use data on customers of
Amazon.com, Amazon Prime members, or users of Amazon wearable devices to target advertising
for One Medical’s services or offer One Medical membership as an add-on to Amazon Prime
membership. Such actions could allow Amazon to rapidly grow One Medical’s membership to the
detriment of other primary care providers. While OHA recognizes this concern, we are not aware of
this happening for Amazon Pharmacy or other Amazon health care ventures. Furthermore, the
current federal review of this transaction is expected to carefully consider any such risks.
OHA does not have immediate concerns about the impact of the transaction on
horizontal consolidation.
Given that One Medical currently has a limited presence in Oregon and serves a small portion of
residents and Amazon Clinic only launched in November 2022, there is currently little concern
about horizontal consolidation in digital asynchronous primary care services as an immediate result
of this transaction. However, as Amazon seeks to increase its footprint in health care and expand
is user base of technology-driven services like Amazon Clinic, the digital support features of the
One Medical application, and the convenient online ordering and home delivery of prescription
medications through Amazon Pharmacy, there is potential for Amazon-owned health services to
greatly increase their market share in Oregon in the coming years.
30-Day Review Summary Report – 005 Amazon One Medical 23
Access
Access to primary care refers to the ability of people to get the care they need when they need it.
Our analyses look at availability of services and providers, types of services, care for different
patient groups, and barriers to getting care.
Access to primary care services can be limited by cost arrangements with insurance plans,
provider capacity, and the health needs of the population being served. For patients with insurance
coverage, primary care providers typically must be in-network for services to be covered.
Accessing services from out-of-network providers typically requires patients to pay more—or
sometimes all—of the visit costs. Given variable reimbursement rates for commercial insurance
and publicly funded coverage like Medicare cand Medicaid, providers may limit how many patients
they can take with certain kinds of coverage in order to maximize revenue. This can include setting
specific limits on how many patients without insurance are accepted and how much charity care or
financial assistance they offer.
Regardless of patient insurance status, providers must also have the capacity to take new patients
onto their panel. Panel sizes are often difficult to calculate and range by practice, but several
recent studies have placed the average panel size for standard patient centered medical home
model clinics at around 1600 - 1800 patients per primary care provider.
47
The panel size a provider
can serve depends on their scheduled hours, qualifications, and the number and length of visits
they are able to routinely offer.
48
The patient volume a primary care provider can serve also depends on the complexity of patient
medical needs. Younger, healthier patients may only require annual preventive care or an
occasional visit for unexpected illness or injury, while patients with multiple chronic conditions may
require more frequent visits or longer visits to achieve and maintain effective disease management.
Providers may also need to spend additional time communicating and coordinating with other
specialists who support patients in treating complex or chronic conditions.
49
Current Performance
Patient and Visit Volume
As detailed above, One Medical’s five locations in the Portland metro area serve a small segment
of the service area population. Each clinic has one to three providers, all with qualifications as
medical doctor (MD), physician assistant (PA), osteopath (DO) or nurse practitioner (NP).
Payer and Patient Mix
Most of the insurance plans One Medical accepts in Oregon are commercial plans, which includes
employer self-insured plans. The One Medical website for Portland-area locations indicates that
Medicare Part B (Original Medicare) is currently accepted, but not Medicare Advantage plans or
Medicaid (coverage through the Oregon Health Plan and Coordinated Care Organizations).
Medicare mostly covers older adults and Medicaid provides coverage to children and people with
low incomes. Compared to the service area population, One Medical’s patient mix may include
more younger adults and fewer children or older adults.
One Medical highlights some key partners on their website, including large technology companies
(e.g., Google), financial investment firms (e.g., NASDAQ) and organizations offering professional
services (such as law firms and communications consultants). One Medical markets their
enterprise membership packages to employers that are likely to have working age and more
affluent employees, which generally makes for healthier patients.
30-Day Review Summary Report – 005 Amazon One Medical 24
Influence of Cost on Access
One Medical services are only available to members who pay a fee, currently $199 for an
individual annual membership. A majority of One Medical patients have their membership
sponsored by their employer as part of their employee health benefit package.
50
These employee
benefit packages may also include a commercial or employer self-insured health plan. Individual
memberships make up a smaller share of One Medical members, who may pay for membership in
addition to the monthly insurance premiums and annual deductibles required by their insurance
plan. Some members pay for care out of pocket, in lieu of having any insurance coverage.
The membership fee does not cover visits at the One Medical clinics; per-service fees are charged
for each visit or virtual consultation. For patients with an employer self-insured plan, the employer
negotiates visit rates with One Medical and patients may be required to cover some part of the visit
cost. One Medical accepts an array of commercial insurance plans and charges fees to patients’
insurance for visits and services provided. Patients may be responsible for copays or coinsurance
depending on the terms of their insurance plan. Patients without insurance coverage are required
to pay the full cost of the visit out-of-pocket.
Membership payment
Other coverage costs
Enterprise or employer-sponsored
Frequently paired with employer self-insured plan that may have a
monthly premium, per-visit copays, and/or other cost sharing
Individual or self-paid, with
insurance
May have monthly premium and annual deductible; per-visit copays
and/or coinsurance depending on visit type
Individual or self-paid, without
insurance
No monthly premium or annual deductible; full out-of-pocket
payment for all visits and services
Financial assistance is available to help defer some of the cost of the membership fee and/or visit
costs for eligible applicants who have no or limited insurance and meet certain financial criteria –
but this assistance is only available to existing members. One Medical also offers a Limited Access
option that includes in-person visits but none of the digital supports and virtual visits. The financial
criteria for receiving assistance and the cost of a Limited Access membership are not publicly
available.
51
The cost of One Medical’s membership fee may not pose a barrier to access for some patients,
particularly those whose employers cover their fee. The annual membership and full out-of-pocket
costs for healthier patients without insurance may be more affordable than annual premium fees
and deductible obligations under some insurance plans, particularly if they qualify for One
Medical’s financial assistance. Those who may experience the greatest barrier to accessing
services at One Medical are patients with insurance coverage who are required to pay the
membership fee themselves, in addition to other associated costs with their insurance plan, and
uninsured patients with greater health care needs who cannot afford to pay full out-of-pocket costs
for higher number of visits.
Concerns about equity in access with the concierge or retainer model have been raised for over a
decade. A 2005 study found that retainer clinics served fewer patients who were African American
or Hispanic, had diabetes, or were covered by Medicaid than non-retainer counterparts.
52
In 2015
the American College of Physicians issued a position paper about the implications of expanding
direct contracting or retainer practices on the broader health care system, noting pros and cons for
30-Day Review Summary Report – 005 Amazon One Medical 25
both patients and providers. The paper highlights the ethical implications of practice models that
exclude certain patients based on financial or insurance status, noting:
Physicians have both individual and collective responsibilities to care for all. Such ethical
considerations must guide physicians in considering the types of practices they choose to
participate in and what they must do to ensure their practices provide accessible care to
patients in a nondiscriminatory manner. Practices that, by design, exclude certain
categories of patients should be understood to create a greater potential of being
discriminatory against underserved populations and require special attention by physicians
to the ethical considerations involved
The paper continues to stress the importance of opening
practices to Medicaid-covered patients, emphasizing that:
The College also believes that physicians in all
types of practices should strive to take care of
patients enrolled in Medicaid. Medicaid is a crucial
part of the safety net for poor persons
One in four residents is covered by the Oregon’s Medicaid
program, either through the centrally-run fee-for-service
program OpenCard, or the managed care of local
Coordinated Care Organizations throughout the state. By
not accepting Medicaid, One Medical presents a
significant barrier to access for a quarter of the
community.
Potential Impacts
In the notice, Amazon indicated its intention not only to
maintain current services and locations but to expand One
Medical’s market share in Oregon:
One Medical currently has a limited presence in
Oregon, and Amazon expects to retain One
Medical's current employees and contractors and
to continue or expand One Medical's service
offerings. Amazon plans over time to increase One
Medical's presence by expanding its network of
clinics, thereby providing additional convenient,
affordable, and accessible options for primary care
services.
One Medical has been expanding quickly and has
demonstrated that their model is not currently profitable—or even revenue neutral—as they have
reported increasing operating losses over the last several years. Amazon is unlikely to invest in an
organization that will only lose them money indefinitely, so we anticipate changes to the One
Medical model that will seek to increase revenue and decrease operating costs. OHA asked
Amazon for more information about their expansion plans and they provided this response:
Applicable law limits Amazon and One Medical from engaging in extensive coordination
over business activities unless and until the proposed transaction closes. As such,
We need to distinguish between
succeeding as a business — getting a
return for investors — and succeeding as
a positive influence on our health care
system. There’s no question many of
these start-ups will make money. What I’m
uncertain about is whether that will result
in cheaper and better care for the
population as a whole. They may be good
at providing convenient care to relatively
healthy people and maybe a fraction of the
not-so-healthy people who have serious
but not complicated illness. But I’m
concerned about whether they will take
care of people whose insurance is not
desirable or patients who are very
complex and hard to manage. Smaller
start-ups have to give their investors a
payback within three to five years. That’s
what gives me pause, though I think some
new market entrants are exciting and
potentially positive.
- David Blumenthal, Commonwealth Fund
President, discussing what it will take for
new start-ups to fundamentally change
healthcare
30-Day Review Summary Report – 005 Amazon One Medical 26
discussions concerning expansion of One Medical’s service offerings or presence in
Oregon have not taken place and will not take place until closing. That said, Amazon and
One Medical believe they can and will help more people get better care, when and how
they need it. They look forward to delivering on that long-term mission.
Given that current revenue generation depends on the number of members, in the form of both
annual fees and monthly per-member payments from partners, it is likely that Amazon will make
pushes to expand One Medical’s membership base. Adding additional members will increase
demand for visits and other provider coordination activities, which may decrease availability of
same-day or next-day appointments for existing members.
Amazon could also seek to
increase the annual One Medical
membership fee, as it has with its
Amazon Prime service. Prime
membership remained steady for
nearly a decade but has seen
more frequent $20 increases in the
last 8 years.
53
Increases to the
annual membership fee, or prices
charged for individual visits, may
make One Medical services less
accessible to low-income
community members without
insurance.
Amazon may also encourage One
Medical to accept patients with
Medicare Advantage coverage in Oregon, which would increase access to primary care services
for the older adult population that is likely to be underrepresented in their patient pool. Capitated
payments from Medicare Advantage plans represent 50% of One Medical’s revenue nationally, so
this change could help bolster the financial stability of locations in Oregon, particularly if the
intended clinic expansion strategically targets areas with higher percentages of older adults.
While additional clinics are a welcome increase in the supply of primary care services in the region,
there is concern that too-rapid expansion of clinics without concrete plans to stabilize the financial
position of One Medical for the long term may leave a larger number of patients with uncertain
access to providers and services upon which they have come to depend. Amazon’s press releases
frequently reference their desire to “disrupt health care,” but their track record has been one of
short-term ventures that have resulted in rapid expansion of programs or services that have
ultimately been shut down after only 3 years, leaving affected patients to reestablish pathways to
connect to needed care.
$79 $99 $119 $139
25%
20%
17%
2005 2014 2018 2022
Annual fee % increase
Amazon Prime annual membrship fees increased
from $79 in 2005 to $139 in 2022
30-Day Review Summary Report – 005 Amazon One Medical 27
Program
Services offered
Started
Ended
Haven
Joint venture providing more convenient, lower-cost
health care services for Amazon employees; intended
to disrupt national health care delivery
54
2018
2021
Amazon Care
Hybrid in-person, in-home and telehealth primary
care services for Amazon employees and other
Seattle-area employers; intended to expand to
additional metropolitan markets
55
2019
2022
Amazon Alexa HIPAA-
compliant skills kit for
3
rd
party developers
Secure voice transmission of personal health
information with payers and providers through
patients’ Alexa devices
56
2019
2022
Amazon CEO Andy Jassy has referred to Amazon Care as part of “iterative innovation,” which can
work well in optimizing products and user experiences in technology sectors.
57
In health care
however, consistent access to services and providers is pivotal in managing chronic conditions and
helping patients meet long-term health goals.
Research has found that developing trusting and
supportive relationships between patients and providers can improve not only the patient
experience but also outcomes, especially for patients receiving support for mental health
conditions, but this takes time and consistent contact to achieve.
58
59
Another study concluded that
higher continuity with the same primary care provider resulted in lower costs, fewer hospitalizations
and improved health equity and care quality.
60
A former executive of Amazon Care articulated the challenge of applying Amazon’s approach in
other sectors to the health care landscape:
61
As the company embarks on what promises to be a major expansion into health-care
delivery, Amazon is “going to try and do what they do in every other line of business:
They’re going to try and make it better than everyone else, make it less expensive and get
crazy adoption because of convenience,” said one former Amazon Care executive. “But,”
the executive added, “health-care is different. It’s hard.”
One Medical locations are relatively new in Oregon, so they are still building a patient population
and relationships. Their financial status is uncertain and the investment from Amazon could
stabilize their business. Changes Amazon may make to improve profitability of One Medical in
Oregon could improve access for some community members or create additional barriers for
others. Most importantly, Amazon needs to make a longer-term commitment to this venture in
order to maintain current access as well as support growth in services that is sustainable and
meaningful for patients.
Entity statements about access
The entity does not anticipate that the transaction will negatively affect access. In the notice, they
stated:
Amazon does not intend to restrict or otherwise reduce the scope of professional medical
services delivered by the One Medical Professional Entities. Amazon also has no intention
of limiting any patient’s freedom of choice with respect to pharmacy, specialty care, or other
health services
30-Day Review Summary Report – 005 Amazon One Medical 28
OHA does not have specific concerns about reductions in access to care resulting
from this transaction.
According to data, One Medical services appear to be accessed by younger, commercially insured
patients. Amazon has stated their intention to maintain the current level of access and staffing at
the five One Medical clinics and has plans to expand over time. OHA will monitor any changes in
access to services through follow-up reviews and approval conditions.
30-Day Review Summary Report – 005 Amazon One Medical 29
Cost
HCMO reviews consider how transactions may affect prices for health care services in Oregon,
particularly any impacts on prices paid by patients and consumers. OHA also considers potential
effects on total spending on health care services by insurers, employers, and government payers
as well as impacts on the financial condition of the health care companies involved.
Current Performance
As noted earlier, One Medical’s services in Oregon are not adequately captured in claims data.
OHA does not have sufficient data to assess One Medical’s past or current prices relative to other
primary care providers or analyze trends in spending on health care services from One Medical
clinics in Oregon. OHA’s analysis in the cost domain was thus limited to the financial condition of
One Medical.
One Medical has operated at a net financial loss, with operating expenses higher than revenues,
since the company was formed in 2007.
62
This means that the company spends more than it brings
in. The chart below shows One Medical’s net revenue, operating expenses and operating margin
(operating losses as a percentage of net revenue) for the years 2017 through 2021. Although total
net revenues grew consistently during this time, growth in operating expenses was equally strong
in 2017-2020 and almost doubled from 2020 to 2021, outpacing revenue growth. The company’s
(negative) operating margin hovered around -20% between 2017 and 2020, dropping to -39% in
2021.
On January 31, 2021, One Medical became a public company and was listed on the NASDAQ
stock exchange. Its stock price climbed steadily from $18 a share to a high of $58.70 in February
2021. Since then, it has declined by over 70% and is currently (at the time of writing) trading at
around $17 a share.
$(400)
$(200)
$-
$200
$400
$600
$800
$1,000
2017 2018 2019 2020 2021
Thousands
Operating expenses
Net revenue
Operating loss
One Medical's operating expenses exceeded revenues in all five years
from 2017 to 2021
30-Day Review Summary Report – 005 Amazon One Medical 30
Given its history of negative margins, One Medical needs to continue to raise capital to fund its
operations and continued growth. The merger should provide a reliable source of capital in the
near to medium term. Under the proposed agreement, Amazon has agreed to provide One Medical
with a loan of up to $300 million. In the long run, however, Amazon is unlikely to continue
supporting the business indefinitely unless it can turn a profit.
Potential Impacts
The transaction will likely have a positive impact on One Medical’s financial stability in the near to
medium term by providing additional capital to fund operations and growth. In the long term, it
remains uncertain whether One Medical can attain profitability, even as a subsidiary of Amazon. As
noted earlier, Amazon has limited experience in the health care sector and has recently
abandoned several unsuccessful health care business ventures.
While we were unable to analyze current prices for One Medical’ services, OHA does not see any
risk that the transaction would result in an increase in One Medical’s prices for health care services
in Oregon. Through the newly launched Amazon Clinic, Amazon currently provides a limited set of
virtual messaging-based health care services in Oregon which do not directly compete with One
Medical’s suite of services. The transaction does not raise concerns about horizontal consolidation
in Oregon’s market for primary care services. One Medical partners with Providence to bill
commercial insurers. One Medical’s partnership with Providence presumably allows One Medical
to obtain more favorable reimbursement rates than it could negotiate independently. OHA has no
reason to expect that Providence will be able to negotiate higher rates for One Medical’s services
because of the merger.
One Medical maintains that its health system partnership model creates a “clinically integrated
delivery network” that promotes care coordination and reduces costs. Again, because most One
Medical services are not captured in claims, OHA is unable to compare One Medical’s spending on
$0
$10
$20
$30
$40
$50
$60
$70
One Medical's stock price has declined more than 70% since February 2021
30-Day Review Summary Report – 005 Amazon One Medical 31
health care services to that of other primary care providers in Oregon, many of which are also
integrated to various degrees with health systems. To the extent that the transaction enables One
Medical to grow its services in Oregon, the impact on overall health spending depends on whether
One Medical spends more or less on patient care overall than other primary care providers.
The merger may offer opportunities for One Medical to reduce operating costs by using Amazon’s
technology platform and data management capabilities or shifting certain types of in-person care
(e.g., prescription renewals, chronic condition management) to virtual or digital services. While cost
reductions would improve One Medical’s financial performance, they would not reduce overall
health care spending by payers, employers, and patients in Oregon unless Amazon passed on the
cost savings through lower prices for One Medical services.
Entity statements about cost
Amazon does not anticipate that the transaction will negatively affect health care costs or
spending. In the notice, they stated:
The proposed transaction will enable Amazon to make One Medical’s high-quality,
affordable health care available to more patients. It will also allow Amazon to make further
investments in technology and services that increase access to health care services and
reduce costs.”
OHA does not have concerns about price increases resulting from the transaction.
One Medical partners with Providence to negotiate with and bill commercial insurers. The
transaction will not increase One Medical and Amazon’s joint share of the primary care services
market in Oregon. OHA therefore does not anticipate that the merger would lead to higher
negotiated rates. The transaction will likely improve One Medical’s financial condition by providing
access to capital to continue to fund operations.
30-Day Review Summary Report – 005 Amazon One Medical 32
Quality
Quality of care refers to whether patients are getting the care they need, how well that care aligns
with evidence-based best practices, outcomes of care, and patient experiences of care.
There are many standards for measuring quality within primary care. National and regional
organizations have developed measures of quality, established benchmarks for various insurance
markets, and issued guidelines on data collection, reporting and improvement strategies.
Organization/
Program
Description
National Committee
for Quality Assurance
(NCQA)
Manages the Healthcare Effectiveness Data and Information Set (HEDIS), a
widely used set of process and outcomes measures across various parts of the
health care sector
63
Agency for Healthcare
Research and Quality
(AHRQ)
Develops measures of quality of care and patient safety and creates guidelines
for standardized reporting, best practices, and quality improvement initiatives
64
Manages the Consumer Assessment of Healthcare Providers and Systems
(CAHPS) survey, a tool to capture patient experience
65
The Joint Commission
Works with NCQA to offer quality accreditation and issue reports on quality
scores for health care providers, including primary care clinics and patient-
centered medical homes
Centers for Medicare
and Medicaid Services
(CMS)
Collects quality measure data from a range of providers and health care facilities
through the Merit-based Incentive Payment System (MIPS)
Publicly reports quality scores from MIPS and aggregate Star ratings on the Care
Compare website
Patient-centered
Primary Care Home
(PCPCH)
Oregon program to recognize tiers of quality improvement for primary care clinics
throughout the state
66
Office of the National
Coordinator for Health
Information
Technology (ONC)
Promotes the development and adoption of health information technology;
creates national standards for information sharing across technology products
and solutions
Each of these organizations and programs has identified important aspects of delivering effective
primary care at the individual and population level. Routine reporting around standard measures
and quality incentive programs from payers have helped drive improvements in primary care.
Publicly available information about quality measure results, like the CMS Star ratings, helps
patients make informed decisions about where to receive primary care based on the aspects of
care delivery that are important to them, including clinical outcomes and provider interactions.
Current Performance
Quality Data Reporting
One Medical does not seem to participate in quality reporting programs that would make quality
performance information public. One Medical’s Oregon clinics are not recognized by the PCPCH
program. One reason for this could be that Oregon One Medical clinics are relatively new and do
30-Day Review Summary Report – 005 Amazon One Medical 33
not have the patient volume or longevity of engagement to support complete quality measure
reporting.
By accepting Medicare Part B, eligible providers are required to participate in either the Merit-
based Incentive Payment System (MIPS) or an Advanced Alternative Payment Model (APM), but
we don’t know if providers at the Oregon One Medical locations are eligible and report quality data
through the MIPS program (the Medicare-covered population in Oregon is likely too small).
67
Most of the quality performance data presented on the One Medical website references internal
reports that are not publicly available. Some measures appear to use data from claims that is
reported to commercial insurance plans, but only one plan is named directly (CareFirst BlueCross
BlueShield, operating in the Washington DC area). It is not known if the One Medical clinics in
Oregon participate in any quality reporting or primary care medical home programs with locally
contracted insurers. The screenshot from One Medical’s website shows key metrics that One
Medical uses to advertise that they deliver better quality. OHA was not able to externally verify
these performance scores.
Clinical Quality Measures
Limited information is publicly available about clinical quality for One Medical providers. The
Centers for Medicaid and Medicare Services (CMS) manages a Care Compare website that allows
potential patients to view information about individual providers and the practice groups with which
they are affiliated. The Care Compare site allows you to select providers, compare information
about them, and view information about the affiliated group’s quality-based Star Ratings, which
reflect aggregate performance on key quality measures across all providers in the practice group.
One Medical providers are not searchable on Care Compare under ‘One Medical,’ but users can
find information for One Medical providers by searching on name or clinic addresses. Users can
download individual provider scores for quality measures, however only one Oregon-based One
Medical provider has current data in this file.
68
The most recent file reflects performance for 2020
and represents the only public insight into One Medical’s quality performance in Oregon that OHA
uncovered.
One Medical’s website indicates an observed reduction in medical costs due to decreased
emergency room, urgent care and specialty visits for patients of an unnamed employer client, but it
is unclear how external utilization of these services is tracked and reported here in Oregon.
30-Day Review Summary Report – 005 Amazon One Medical 34
Virtual vs. In-Person Care
One Medical’s locations in Oregon advertise as delivering care virtually with 24/7 video visits,
which has become more common practice since the start of the COVID-19 pandemic. Research
prior to the pandemic suggested that similar levels of diagnostic accuracy were achieved through
in-person and virtual approaches but cautioned about the impact of disrupting continuity of care as
multiple providers may respond to requests for virtual visits.
69
A more recently published study
compared in-person and virtual visits delivered during the pandemic and observed similar or better
performance on most standard quality measures while noting a need for more understanding of the
optimal blend of in-person and virtual care to maintain the critical patient-provider relationship.
70
Patient Experience
One Medical’s website focuses on the patient experience of accessing care and highlights the
convenience of their model, offering same-day appointments, virtual support 24 hours a day and
easy appointment booking and provider communication. They do not appear to administer the
CAHPS Clinician & Group survey or other similar patient experience survey tools, but instead
utilize the Net Promoter Score (NPS) to measure the customer experience. The NPS tool asks only
one question, “How likely is it that you would recommend this product/service/brand to a friend or
colleague?”, and customers respond on a 10-point scale.
The calculation of the overall NPS can mask detractors among the respondents. Some tools ask
open-ended questions about the reason for the score given and what could be done to improve the
experience, but it is unclear if One Medical includes these questions as part of their tool.
NPS is designed to measure brand loyalty and predict business growth.
71
Other tools, such as
CAHPS, capture more nuanced elements of the patient’s perspective and offer greater insight into
the patient’s needs and perceptions. CAHPS may also highlight specific areas where clinical
practice can be improved.
Electronic Health Records and Information Exchange
One Medical’s self-developed, proprietary technology platform, known collectively as 1Life,
supports electronic medical record management, scheduling, and billing tasks, as well as patient-
facing services like the Web Portal and mobile phone application. One Medical’s website describes
the benefits of designing the platform in concert with clinicians to facilitate their interaction with
patients, and the benefits of other clinicians within the One Medical system having access to
patient information at various points of care.
72
The website does not mention the 1Life platform’s
interoperability, which refers to the ability to connect to and transmit information between other
electronic health record (EHR) solutions outside of One Medical.
Interoperability is a critical aspect of certification from the Office of the National Coordinator for
Health Information Technology (ONC). ONC sits within the U.S. Department of Health and Human
Services and is charged with promoting adoption of health information technology and creating
standards that facilitate data sharing and interoperability across technology products and solutions
30-Day Review Summary Report – 005 Amazon One Medical 35
in support of improved communication between providers and coordination of care across the
national health care system. When specific elements of EHR functionality are certified, it indicates
that the EHR platform can perform a task in a way that is consistent with national standards and
therefore compatible with other available EHR solutions.
Aspects of the 1Life platform have been available since One Medical’s inception in 2007, with
additional features and application versions being developed over the years.
73
However, the 1Life
electronic medical record was only recently certified (August 2022) by the ONC.
74
The platform met
25 of 57 unique certification criteria. The 1Life platform lacks certification for the elements listed in
the table below.
The 1Life platform does not have ONC certification for these elements
Quality of care and patient safety
• Calculation and reporting of clinical quality
measures
• Development of a care plan
• Electronic prescribing
• Computerized Provider Order Entry (CPOE) for
labs and imaging (which facilitate external
referrals and generate patient reminders for
these services), as well as automated drug-drug
and drug-allergy checks for such orders
Health Information Exchanges (HIEs) allow providers and patients to access and share health
information. This type of coordination and communication can help providers improve care for
patients, avoid duplicating services, and avoid errors in care. One Medical’s website indicates they
will begin to participate in local and national Health Information Exchanges (HIEs), but there is no
indication of timing. This suggests that One Medical may not currently fully participate in data
exchange processes that support optimal patient safety and allow for accurate reporting of quality
measure performance.
Interoperability and data exchange with other health networks is important to evaluate the quality-
of-care patients receive as they see different providers and move through the health care system.
The ONC certification status suggests there may be limitations in the 1Life platform’s ability to
capture external quality of care data and generate reporting in a manner that aligns with national
standards.
Potential Impacts
In the notice Amazon indicated that “One Medical Professional Entities will retain exclusive control
over all professional medical services delivered to One Medical patients.” Amazon Care, however,
provides some insight into how Amazon may influence clinical practice. Amazon Care also
demonstrates how Amazon’s branded approach to expanding into new sectors may conflict with
best practices around quality care and safety.
OHA does not have access to any quality data from Amazon Care and must rely on any public
information about the program to judge Amazon’s approach to quality in primary care. In August
30-Day Review Summary Report – 005 Amazon One Medical 36
2022, former employees of Amazon Care spoke anonymously with The Washington Post to share
their concerns about quality and safety.
75
Of particular concern was that patient satisfaction and
convenience was felt to be prioritized over clinical best practice:
Amazon’s obsession with customers did raise some concerns within Amazon Care. In news
releases about Amazon Care, Amazon boasts of having “a satisfaction rating of 4.7 out of
5.” But the former Amazon Care executive said there’s a “tension between what would give
you good ratings versus what is sound clinical care.”
Despite the parent company for Amazon Care, Care Medical, being an independent organization,
pressure from Amazon influenced how care was delivered:
The two former nurses and the former executive said Amazon called the shots and Care
Medical existed to execute the company’s vision. And as that vision expanded, some Care
Medical staffers worried that Amazon was moving ahead without implementing the
safeguards typical of a medical organization.
Amazon Care was under pressure to hit certain goals for growth and customer satisfaction,
and Care Medical ultimately “didn’t have as much autonomy as they hoped or wanted,”
according to the former Amazon Care executive. “Where in traditional health care clinicians
run the shop and guide everything else, this was more the reverse.”
Some Amazon decisions significantly impacted clinicians’ ability to deliver care efficiently and
safely. Former staff cited challenges with low-cost electronic health record software, non-functional
wireless equipment and absence of a tracking app with an alert function to support providers who
delivered in-home care in a range of precarious settings. Amazon Care’s rapid expansion into
telehealth posed additional challenges, as providers were not aware of local resources to make
referrals and did not always have a clear understanding of variations in regulations from state to
state to know if the services they were providing met regional guidelines.
While a spokesperson for Amazon provided assurances that Amazon Care followed best practice
standards and provided safety training to employees, the experience of former staff raise concerns
about the impact Amazon may have on One Medical’s approach to care delivery and clinical
quality.
76
Additionally, given Amazon’s interest in virtual care and digital services and its goals
around transforming care through technological innovation, the transaction may bring changes in
how virtual and digital services are incorporated into One Medical’s primary care model, for
example, through changes in the blend of virtual and in-person services and the use of remote
providers. Such changes could also impact quality of care.
Entity statements about quality
In the notice, Amazon did not address the transaction’s impact on quality, but did include
statements about One Medical’s quality of care:
One Medical has a demonstrated history of excellent care and high patient satisfaction. The
proposed transaction will enable Amazon to make One Medical's high-quality, affordable
health care available to more patients.
OHA surfaced potential concerns about quality of care for this transaction.
OHA has limited insight into One Medical’s quality performance and patient safety, compared with
other primary care practices in Oregon. This lack of public information may make it difficult for
patients to make informed decisions about where to seek care.
30-Day Review Summary Report – 005 Amazon One Medical 37
Amazon’s recent experience operating other health care entities, including delivering in-person and
virtual primary care services, raises potential concerns about the impact this transaction may have
on the delivery of high-quality care.
OHA will require routine reporting of patient population and quality measures. This reporting, along
with follow-up reviews, will allow OHA to monitor the impact of the transaction on the quality of
primary care in Oregon.
30-Day Review Summary Report – 005 Amazon One Medical 38
Equity
To assess equity, OHA looked at current practices at One Medical and Amazon to advance equity
and potential impacts of the transaction on health equity. This includes examining existing or
potential disparities in access, quality, or cost; and factors that may promote or hinder health
equity.
Equitable Access
One Medical’s business model locates offices in affluent areas and appeals to employed,
commercially insured patients – which likely results in the company potentially drawing
disproportionately younger, healthier patients. This could result in One Medical “syphoning off”
healthier patients with higher payments from other primary care providers in an area, leaving those
providers to serve sicker patients with lower payments, contributing further to class and racial
inequities in the health care system.
One Medical does not currently accept Medicaid
Commercial insurance generally pays higher rates
for many services, while Medicare and Medicaid
often have lower reimbursements. In Oregon, One
Medical primarily appears to cater to commercially
insured, relatively younger and healthy patients
employed by large companies who reside in urban
areas. Total medical expenses for One Medical
patients are likely lower, compared to other primary
care patients.
77
78
If One Medical continues to expand its model in
Oregon under Amazon’s ownership, it could have a
negative financial impact for primary care providers
that serve the broader community. For primary
care clinics that serve patients with Medicaid, a
reduction in commercially insured patients could
lead to fewer resources – and some providers that
serve Medicaid populations may struggle to
maintain access for low-income patients with more complex health needs.
While One Medical executives have expressed an interest in accepting Medicaid coverage, the
company has cited barriers to entering the market, including a high volume of churn among
Medicaid patients.
79
The Notice does not include any discussion of plans to accept Medicaid in the
future.
The U.S. Congress investigated One Medical’s COVID vaccination practices
In 2021, NPR reported that One Medical had allowed ineligible people to receive COVID-19
vaccines ahead of those with higher risks.
80
The article cited concerns of staff in California,
Oregon, and Washington states.
Following these media reports, the U.S. Congress Select Subcommittee on the Coronavirus Crisis
investigated One Medical’s role in administering COVID-19 vaccines. The investigation found that
One Medical “took advantage of access to coronavirus vaccines to benefit their own business and
personal interests, did not adequately monitor patients signing up for and receiving vaccinations to
With reimbursement rates so wide, total
reimbursement rates are extremely
sensitive to patient mix. Even a small
percentage reduction in the number of
Medicaid patients, combined with an
increase in the percentage of private
insurance patients could double or triple
the net operating margin for a particular
clinic, but this would be accomplished by
leaving other clinics to pick up the extra
load of Medicaid patients, or leave those
patients without care.
- Public comment from Warren George
30-Day Review Summary Report – 005 Amazon One Medical 39
ensure their eligibility under prioritization guidelines, and failed to administer coronavirus vaccines
equitably during the early vaccine rollout.”
81
The investigation cited evidence that:
• One Medical sought to steer people
seeking vaccines to enroll in paid
memberships, including implementing a
confusing vaccine sign up process the
caused some people to pay for an
unwanted membership.
• One Medical allowed non-patient facing
employees, family, friends, and VIP
enterprise clients to get early access to
vaccines before they were eligible.
• One Medical employees raised concerns
regarding the failure to stop ineligible
patients from signing up for vaccines and
failure to ensure that the most vulnerable
people were able to receive vaccines. The
City of Berkeley and Washington State
Department of Health also raised concerns
about inequitable distribution of vaccines,
and both halted distribution of vaccines to
One Medical in February 2021.
One Medical refuted the findings of the
investigation, stating that they adhered to vaccine prioritization guidelines. A spokesperson stated:
“The early days of vaccine availability were unprecedented and difficult for the entire healthcare
system. At One Medical, we endeavored to follow the vaccination eligibility criteria as they rapidly
changed, often day-to-day and across states and counties. It was a challenge in a challenging
time, and our eligibility checking processes responded and improved from the early days of
vaccinations.”
82
Equity-enhancing services
Equity-enhancing services include efforts to make care more accessible for populations that
experience barriers. Examples of equity-enhancing services include translation and interpretation
services, care coordination, screening for social needs, referrals to community-based
organizations, and services designed to improve care and outcomes for specific populations.
Language access and culturally responsive care
One Medical’s website includes language assistance services contact information in 15 different
languages, but those messages are not prominently displayed.
83
This information is not linked from
the home page and requires scrolling down on the non-discrimination page to view. Language
access information is not posted on clinic location pages, but languages spoken by individual
providers are included in provider bios. The website also includes language about LGBTQIA+
services but does not provide much detail about specific services. Some providers list a focus on
LGBTQIA+ health.
84
“One Medical took advantage of its access
to scarce coronavirus vaccines to promote
the company’s business interests and
push vaccine seekers toward paying for
One Medical Memberships.”
- U.S. Congress, Select Subcommittee on
the Coronavirus Crisis Memorandum
“I believe they are taking advantage of the
COVID crisis to increase their membership
and deceiving people into their program.”
- Vaccine seeker, quoted in U.S.
Congress, Select Subcommittee on the
Coronavirus Crisis Memorandum
30-Day Review Summary Report – 005 Amazon One Medical 40
One Medical has posted several publicly available documents that provide information about
company policies related to equity. The One Medical website includes a notice of non-
discrimination, stating that the company complies with Federal civil rights laws.
85
One Medical’s
Code of Business Conduct includes language related to equal employment opportunity, diversity
and inclusion, and discrimination and harassment free workplace.
86
According to Amazon’s website, the company adheres to “global human rights principles” and has
an equal employment opportunity policy.
87
Amazon has a diversity, equity, and inclusion webpage,
where they report workforce demographic information.
88
Community Engagement and Investments
One Medical is a large, national primary care organization. Amazon is among the largest retail
companies in the world. They operate in many communities and act at a national – or even
international – level.
Financial Assistance
One Medical offers financial assistance to cover medical care and/or annual membership fees to
existing members who meet financial assistance criteria and don’t have health insurance or have
health insurance that does not cover all necessary care. To qualify for financial assistance,
members need to fill out a financial assistance application and provide supporting documentation
such as tax returns or pay stubs.
89
The financial assistance program seems designed to assist
existing One Medical members who lose insurance coverage or have periods of financial hardship
– it is not designed to assist people who are not yet members. One Medical’s financial assistance
program is very limited, but since they are a for-profit company, they are not governed by the same
financial assistance requirements as non-profit providers.
Health Equity Investments
Amazon makes some technology-focused equity investments. In 2021, Amazon launched the
Amazon Web Services Health Equity Initiative, committing to support organizations that promote
equal access to health care and address social determinants of health.
90
Awardees focus on data
and technology solutions, and many focus on global populations. Amazon also has a healthcare
accelerator program with a focus on health equity. Through this initiative, Amazon provides support
to start-ups and technology companies aiming to address social determinants of health and
improve access to care.
91
Potential Impacts
Because One Medical serves a population in
Oregon that is employed, commercially insured,
and likely younger than the population overall, they
could end up “cherry-picking” healthier patients
with higher reimbursement rates. On a large scale,
this could negatively impact providers that serve
the whole community, by drawing away patients
with higher reimbursements. One Medical’s current
footprint in Oregon, however, is small and OHA
does not have evidence that the entities plan to
scale One Medical to a level that would begin to
undermine broader access to clinics in the community. They have shared plans to grow their focus
on Medicare and older adults.
“The ultimate concern is that Amazon’s
merger with One Medical would widen the
disparities in care between those with
means or employer-provided healthcare
and those who do not, such as the poor
and the elderly.”
- Public comment from Athena Coalition
30-Day Review Summary Report – 005 Amazon One Medical 41
One Medical and Amazon both have existing business models that center preferential treatment
and benefits for members. This transaction could potentially lead to efforts to encourage One
Medical patients to use other Amazon products (e.g. Amazon Prime membership) or tie benefits to
membership. It’s possible that Amazon could attempt to create integrated membership benefits
across One Medical, Amazon Pharmacy, Amazon Clinic, and other products. This approach could
eventually result in higher costs or less access for non-members.
Entity statements about equity
The entity did not address equity in the notice of material change transaction.
OHA identified potential equity concerns for this transaction.
This transaction could potentially result in One Medical siphoning off commercially insured patients
with higher payment rates from clinics that serve more Medicaid and Medicare-covered patients.
Those concerns are somewhat mitigated by the fact that One Medical has a small footprint in
Oregon and operates in urban areas with many other primary care provider options. OHA will
monitor One Medical’s payer mix and quality outcomes in follow-up reviews and through required
data submissions.
30-Day Review Summary Report – 005 Amazon One Medical 42
Public Comments
OHA held a public comment period from November 29, 2022,
to December 14, 2022, and received 36 written public
comments via email. Public comments related to this
transaction are posted to the HCMO website.
When applicable, OHA used public comments to inform the
transaction review and incorporated some comments into the
findings of the review. HCMO is governed by statute and rules,
and transaction reviews must stay within the scope of authority
outlined in those regulations. Because of this, OHA was not
able to address all the concerns raised by public comments.
Most commenters opposed the transaction
Of the 36 comments that OHA received, 32 stated that they
oppose the transaction and encouraged OHA to not approve it.
Four comments did not state clear opposition, but raised
concerns, urged OHA to do a thorough review, and/or urged
OHA to apply conditions to ensure the transaction does not
harm public interest. None of the public comments expressed
support for the transaction.
Concerns about unfair competitive advantage
Comments raised concerns that Amazon could use its existing
Amazon Prime membership, advertising, and customer data to
gain an unfair competitive advantage. The comments cited
Amazon’s history of tying services to Prime membership.
Concerns about misuse of patient data
Comments noted that Amazon collects an “unprecedented
volume” of data from customers, through the marketplace,
Alexa voice assistant, Prime Video, Kindle, and other services.
Comments cited Amazon’s past data privacy and security
breaches, as well as misuse of data.
Data privacy and security is not within the scope of HCMO
reviews; however, this concern may be addressed in the
Federal Trade Commission review.
Concerns about treatment of workers
Comments highlighted Amazon’s documented history of poor
and unsafe working conditions, surveillance of workers,
retaliation against workers that speak out, anti-union efforts,
and denying accommodations for workers with disabilities in
other sectors. Comments raised concerns that Amazon would
impact One Medical’s workforce and have workforce
implications across the health care sector.
“Amazon is about making
profits for its shareholders,
not about caring for the
health of individuals or
communities.”
“By bundling services,
Amazon can leverage its
online retail dominance and
its vast advertising and data
collection to target
customers of health care
products for One Medical
services. Similarly, it could
also use this data to predict
and siphon off the most
profitable patients and
customers, undermining
broad community health.”
“Please say NO to yet
another organization trying
to make money from sick
Oregonians.”
“Amazon’s acquisition of
One Medical will not only
impact working conditions in
One Medical facilities in
Oregon, but it risks lowering
standards across the health
care system.”
“To learn that Amazon is
planning to take over five
One Medical clinics in
Oregon is very distressing;
that can't help make
healthcare more affordable.”
“Amazon is a company
solely concerned with profit.”
30-Day Review Summary Report – 005 Amazon One Medical 43
Concerns about for-profit health care
Many comments raised concerns that Amazon is a for-profit
company. Comments stated that, as a for profit company,
Amazon’s main priority is to make money for shareholders,
which is in conflict with providing the best care for patients or
advancing health equity.
HCMO reviews consider the impact of the transaction on
costs, access to care, quality of care, and health equity,
regardless of whether the entity is for-profit or non-profit. While
a change in for-profit or non-profit status could affect each of
these areas, no such change is happening as part of this
transaction, since One Medical is a for-profit, publicly traded
company. Amazon’s for-profit status is not, in and of itself,
grounds for OHA to reject a transaction under HCMO’s
statute.
Concerns about vertical consolidation and price
increases
Comments raised concerns about vertical consolidation,
where one company buys another company that provides
different products or services and urged OHA to consider
whether the transaction could increase costs or reduce
access. The comments urged OHA to closely monitor the
impact of the transaction.
Concerns about widening health inequities for primary
care patients
Comments noted that different types of insurance pay different
rates for similar services, with commercial insurance paying
more than Medicare or Medicaid – and if some providers do
not accept the full range of coverage options, other providers
who serve all patients will be financially impacted. This could
result in greater health care disparities and inequities. One
comment urged OHA to explore options that would require
Amazon and One Medical to serve patients with all types of
insurance coverage.
“Profit-based companies
such as Amazon have
shown no ability to increase
access, affordability, and
quality of health care in
Oregon or anywhere else…”
“Vertical consolidation,
where large companies buy
up smaller ones, are
particularly concerning due
to the potential
anticompetitive effects of
having fewer and more
powerful players controlling
the market.”
“The Amazon-One Medical
merger may broaden the
current stratification between
those who can access
quality primary care and
those who only seek
emergency medical care.”
30-Day Review Summary Report – 005 Amazon One Medical 44
Conclusions
Based on preliminary review findings, OHA approved the transaction on December 28, 2022,
subject to the conditions listed below. (See Findings of Fact, Conclusions of Law, and Final
Order in the Matter of the Proposed Material Change Transaction of Amazon.com, Inc. and 1Life
Healthcare, Inc., dated December 28, 2022.)
The transaction was approved, per ORS 415.501(6)(b), because OHA determined the transaction
is unlikely to have a significant impact on Oregon’s health care system. Specifically, the transaction
meets the following criteria under OAR 409-070-0055(2):
1. The material change transaction is unlikely to substantially reduce access to affordable
health care in Oregon
2. Comprehensive review of the material change transaction is not warranted given the size
and effects of the transaction.
These criteria are specified in administrative rules for the Health Care Market Oversight Program
and are consistent with Oregon law. Below is a summary of the main reasons why OHA considers
the criteria to be satisfied.
Approval Criteria
The material change transaction is not likely to substantially reduce access to
affordable health care in Oregon.
In the locations where One Medical operates in Oregon, patients have many other options to
access similar types of services. If the current One Medical locations ceased to operate, other
providers would likely be able to serve patients. OHA does not anticipate that this transaction will
result in increased prices. One Medical currently operates five clinics in the Portland Metro area
and Amazon has stated plans to expand One Medical network clinics over time. Combining with
Amazon, a giant organization with advanced supply chain and purchasing power, may generate
efficiencies and savings for One Medical, though any savings would not necessarily be passed to
consumers.
Comprehensive review of the material change transaction is not warranted given the
size effects of the transaction.
One Medical currently operates five clinics in the Portland Metro area and largely serves people
with commercial insurance coverage. This represents a small segment of primary care patients in
the Portland Metro region and does not impact other geographic areas in the state.
Approval conditions
Per ORS 415.501(6) and OAR 409-070-0065, OHA may place conditions on approving a material
change transaction. OHA has applied the following conditions to approval of the planned Amazon
and One Medical transaction:
1. For a period of five years following the close of the transaction, entities must submit the
following services data semi-annually (every six months) for locations in Oregon:
a. Count of members (by enterprise and individual membership, demographics, and
insurance type)
b. Count of members with at least one visit of any type during the six-month reporting
period (by location)
30-Day Review Summary Report – 005 Amazon One Medical 45
c. Count of visits (by location and by in person, synchronous virtual, and asynchronous
virtual visits)
2. For a period of five years following the close of the transaction, entities must submit semi-
annual (every six months) quality measures data for the NQF primary care core set.
3. For a period of five years following the close of the transaction, entities must report semi-
annually (every six months) on the current status or plans for any changes in types of
services offered, number of providers or locations offering services, governance,
ownership, or organizational structure.
Because limited information is available about One Medical’s patients and services, as well as
Amazon’s future plans for One Medical, this required reporting will provide transparency into any
changes that result from the transaction. OHA will be able to monitor for any future concerns
related to quality, access, cost, and equity.
OHA will provide a template for the entities to submit data, with detailed definitions of what must be
included. Once OHA receives notice from the entities that the transaction has closed, OHA will
provide a timeline for submitting information required by approval conditions. OHA may use data
provided by the entities in future public reporting.
The Oregon Health Authority reserves the right to enforce each and every condition set forth herein
to the fullest extent provided by law. In addition to civil penalties and any legal remedies the
Oregon Health Authority may have, OHA shall be entitled to specific performance, injunctive relief,
and such other equitable remedies as a court may deem appropriate for breach of any of these
Conditions. OHA is required to analyze and publish the entities’ compliance with conditions placed
on the transaction and to assess the impact of the transaction under ORS 415.501(19) and (20).
OHA is required to publish its’ analyses and conclusions and include same in the annual health
care cost and spending trend report under ORS 442.386(6).
Post-Transaction Monitoring
As required by ORS 415.501(19) and (20), OHA will conduct follow-up analyses one, two, and five
years after the transaction is complete. OHA’s monitoring will assess compliance with approval
conditions and whether the entities keep the commitments included in the notice, including
commitments that:
• The transaction will not result in a change to health care services
• Amazon will not restrict or otherwise reduce the scope of professional medical services
delivered by One Medical professional entities
• Amazon expects to retain One Medical’s current employees and contractors
• Amazon does not restrict patients’ freedom of choice with respect to pharmacy services
More broadly, OHA will monitor changes to cost, quality, access and equity, and may also assess
other measures relevant to each domain. As part of the required monitoring activities, OHA may
request additional information from the entities. OHA will publicly publish findings and conclusions
from follow-up analyses.
30-Day Review Summary Report – 005 Amazon One Medical 46
Acronyms & Glossary
Acronyms & Abbreviations
AHRQ
Agency for Healthcare Research and Quality
APAC
Oregon’s All Payer All Claims database
AWS
Amazon Web Services
CAHPS
Consumer Assessment of Healthcare Providers and Systems
CMS
Centers for Medicare and Medicaid Services
DCBS
Department of Consumer and Business Services
FTC
Federal Trade Commission
HCMO
Health Care Market Oversight
HIPAA
Health Insurance Portability and Accountability Act
NCQA
National Committee for Quality Assurance
NPS
Net Promoter Score
OHA
Oregon Health Authority
OHP
Oregon Health Plan
PCPCH
Patient-centered primary care home
Glossary
Competition: A situation in a market in which firms or sellers independently strive to attract
buyers for their products or services by varying prices, product characteristics, promotion
strategies, and distribution channels.
Concentration: A measure of the degree of competition in the market; highly concentrated
markets are generally characterized by a smaller number of firms and higher market shares for
individual firms.
Consolidation: The combination of two or business units or companies into a single, larger
organization. Consolidation may occur through a merger, acquisition, joint venture, affiliation
agreement, etc.
Health equity: OHA defines health equity as follows:
Oregon will have established a health system that creates health equity when all people can reach
their full health potential and well-being and are not disadvantaged by their race, ethnicity,
language, disability, age, gender, gender identity, sexual orientation, social class, intersections
among these communities or identities, or other socially determined circumstances. Achieving
health equity requires the ongoing collaboration of all regions and sectors of the state, including
tribal governments to address:
- The equitable distribution or redistribution of resources and power; and
- Recognizing, reconciling, and rectifying historical and contemporary injustices.
30-Day Review Summary Report – 005 Amazon One Medical 47
Appendix A: OHA’s Review
OHA performed a preliminary review of the transaction to assess its potential impact on Oregon’s
health care delivery system. The review explored impacts in four areas (domains): cost, access,
quality, and equity. OHA’s analysis followed the guidelines and methods set out in the HCMO
Analytic Framework published January 31, 2022.
92
The framework is grounded in the goals,
standards and criteria for transaction review and approval outlined in OAR 409-070-0000 through
OAR 409-070-0085.
Background Research and Literature Review
OHA conducted background research on the entities involved in the transaction to understand
more about the proposed transaction, the entities involved, and potential impacts of the
transaction. OHA consulted publicly available sources, including press releases and media reports;
Securities & Exchange Commission (SEC) filings; business filings with the Secretary of State in
Oregon and other states; entity websites; state agency, professional association, and third-party
entity reports; reports commissioned by local, state, and federal government; and other relevant
governmental communications.
Requests for Information
In addition to the information provided in the notice, OHA made two information requests of
Amazon to clarify and supplement the notice, to which Amazon responded. Through these
requests, OHA sought more information about One Medical’s services; the volume of members,
patients, and visits at One Medical locations in Oregon; the nature of the relationship between One
Medical and health system partners; and quality performance.
Public Input
OHA solicited public comments on the proposed transaction during the preliminary review. On
November 29,2022, OHA posted a notice to the Transaction Notices and Reviews page of the
HCMO website and emailed subscribers to HCMO program updates to inform them about the
opportunity to provide comment. The public comment period ended December 14, 2022.
Analysis
OHA’s analysis assessed the current state of the entities involved in the transaction, related
industry trends, and the likely impact of the proposed transaction on the delivery of primary care in
Oregon. The table below describes the types of analysis OHA typically performs in each domain.
Domain
Analysis
Cost
Analyses under the cost domain explore how the transaction may affect the prices consumers
and payers (e.g., insurers, employers, and governments) pay for primary care services in
Oregon. Prices and spending for primary care services may be affected by the degree of
competition between providers offering similar services within a service area.
Access
Analyses under the access domain explore how the transaction may affect the range of
services available in the market, types of providers and provider-patient ratios, characteristics
of the patient population, and any barriers to access, including transportation burdens and
limitations by insurance type.
30-Day Review Summary Report – 005 Amazon One Medical 48
Domain
Analysis
Consolidation and change of ownership in the health care market can impact the range and
type of services offered in the service area. Changes in population demographics can alter
demand for some services and shifts in the labor market can impact availability of specific
provider types, potentially affecting the financial viability and profitability of offering certain
health care services in a region.
Quality
Analyses in the quality domain explore how the transaction may affect patient outcomes and
the experience of care. Consolidations and ownership changes in health care can impact
clinical practice, including staffing ratios, time spent or number of visits with patients, timeliness
of care, and the patient’s experience of care, all of which can have adverse effects on patient
outcomes. Analyses in the quality domain consider current indicators of quality and assess
potential impacts of the transaction on quality of care.
Equity
Analyses in the equity domain explore how the transaction may affect the Entity’s ability to
assess for and equitably meet the needs of the population it serves. Consolidations and
ownership changes in health care can disproportionately impact availability of health services
for populations who already experience health inequities, including people of color, low-income
families, and residents of rural areas. Equity-focused analysis considers the entities’ ability to
serve a patient population that is representative of the community in which they operate. OHA
also looks for evidence that the Entity is actively identifying and addressing inequities in access
to or quality of care across their patient population.
30-Day Review Summary Report – 005 Amazon One Medical 49
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