Category: The Business of Health Care

Ten Shadowy Figures Who Shaped Our Health Care System

Dec 9, 2024

By MIKE MAGEE

The incoming Trump Administration nominees for positions in Health and Human Services (like RFK Jr. to direct the department and Mehmet Oz to head Medicare and Medicaid Services) are names you know and apparently many trust? In this morning’s New York Times, Dr. Ashish Jha, President Biden’s Covid lead, thinks he knows why. He says, “You have a large swath of the population facing a health crisis, and they feel like medicine and public health isn’t delivering…They’re much more open to people saying, ‘The whole system is corrupt and we have to blow the whole thing up.’” As Ashish knows better than most, we didn’t arrive here out of the blue. Over the years, many of the players who had the greatest impact on America’s health care system as we know it, remain hidden in the historic shadows. Here (in no particular order) are 10 of the least known but most influential figures in shaping health policy in our lifetime.

Sam Massengill

In spring 1937, the head of sales for S.E. Massengill Company in Bristol, Tennessee, went to the company head, Samuel Evans Massengill, with an idea generated by customer feedback. Massengill salesmen were passing along reports from doctors that there was demand among parents of young children suffering from strep throat for a liquid version of their new sulfa drug.

Massengill, charged the company’s chief chemist, Harold Cole Watkins, to find an effective solvent in which powdered sulfanilamide (an anti-biotic) could be dissolved. His choice was diethylene glycol, which smoothly dissolved sulfanilamide powder and led to a concoction that was 10 percent sulfanilamide, 72 percent diethylene glycol, and 16 percent water. Flavored with raspberry extract, saccharine, and caramel, it passed the taste and smell tests, but in keeping with then current federal regulations—or lack thereof—there was no test for safety. In fact, no one did even a rudimentary check of the literature on diethylene glycol, which would have quickly revealed that it was a highly toxic component of brake fluid, wallpaper stripper, and antifreeze that had caused a fatality in 1930.

Instead, perhaps sensing that its competition would be right behind, Massengill rushed its “Elixir Sulfanilamide” into production, then shipped 240 gallons of the red liquid to 31 states through a network of small distributors in early September 1937.

Within two weeks, children began to die. In all, more than 100 children died, but only after going through 7 to 21 days of wrenchingly painful illness including “stoppage of urine, severe abdominal pain, nausea, vomiting, stupor, and convulsions.”

The whole disaster was vigorously reported in the press, and drug safety soon inched its way up the list of New Deal priorities. By June 11, 1938, bills from the Senate and House of Representatives had been reconciled, and on June 25, 1938, President Roosevelt signed into law the 1938 Federal Food, Drug, and Cosmetic Act.

Samuel Massengill belatedly issued a statement on behalf of his company: “My chemists and I deeply regret the fatal results, but there was no error in the manufacture of the product. . . . I do not feel there was any responsibility on our part.” Unfortunately, Massengill’s morally blind position reflected the letter of the law at that time. In short, the absence of effective legal sanctions meant that a company or an individual could indeed sell a deadly medication and get away with it.

Mary Lasker

Born in 1900, Mary Lasker was the daughter of Frank Elwin Woodard, the head of the local bank in Watertown, Wisconsin, and a shrewd businessman with Chicago connections. By her own account, she was a campaigner almost from birth, and she traced her interest in promoting medical research back to an event she experienced at the age of three or four. Her mother, a local community supporter and civic activist, took Mary to see their ailing servant, a Mrs. Belter, who had undergone a double mastectomy as treatment for breast cancer. “I thought, this shouldn’t happen to anybody,” Mary Lasker later wrote.

As a young adult, she began to focus on health policy issues and became a devotee to Margaret Sanger. Mary sought out financial support for the organization, turning to a dynamic advertising man, Albert Lasker, who had launched some of America’s most recognizable consumer brands, including Lucky Strike cigarettes. Known as the “father of modern advertising,” Lasker is credited for suggesting that the Control Federation of America be renamed the Planned Parenthood Federation.

When Albert asked Mary what she wanted to accomplish, she listed reforms in health insurance, cancer research, and research against tuberculosis. Albert responded, “Well, for that you don’t need my kind of money. You need federal money, and I will show you how to get it.”

When Mary and Albert married in 1940, the world was preparing for war.

Beginning in 1942, the Laskers began to cultivate science luminaries who shared their commitment to maximizing government funding of applied research. The Laskers realized early that they would need a credible health-related national organization to anchor and launch their campaign and set their sights on the American Society for the Control of Cancer, an organization created in 1913 by 10 physicians meeting at the Harvard Club in New York City. The leadership was more than happy to grant the Laskers easy entry to their Board of Trustees in return for financial support. By 1944, the Laskers had seized control of the Board, largely dumped the doctors, and renamed the group the American Cancer Society (ACS). Its leadership was now composed of name-brand corporate heads, entertainment giants, and advertising executives.

To add further glory to the idea of Big Science, Mary and Albert created the annual Lasker Awards, with the somewhat self-serving tagline “Sometimes called ‘America’s Nobels.’” She then began to collect academic researchers, promote their careers, injecting publicity and special placement on government bodies. Over a decade she was at the center of creating seventeen specialty Institutes within the new NIH, most built around her favored scientists.

Mary Lasker died in 1994, a controversial figure.In the assessment of author and political journalist Elizabeth Drew, “Mrs. Lasker has been considered an able woman who has done good things but is too covetous of power, too insistent on her pursuits, too confident of her own expertise in the minutiae of medicine.”

William Menninger

During the first major WW II battle in North Africa, a startling number of soldiers were incapacitated with “Shell Shock.” One neurologist in North Africa, Frederick R. Hanson, discovered that a bit of kindness in the form of a hot shower and a warm meal, combined with sedation-induced rest, was remarkably successful in rehabilitating the majority of the “mentally incapacitated” men under his care.

Hanson’s success did not go unnoticed by the Army’s chief of the division of neuropsychiatry in the Office of the Surgeon General, William C. Menninger. After studying his results, he decided that if psychiatric casualties in a standard unit exceeded one mental casualty for every four wounded in action, this was a harbinger of broader problems—like a breakdown in morale, leadership issues, prolonged combat fatigue, or a policy breakdown in the evacuation scheme.

Pamela Stahl, Avalon Healthcare Solutions

Jul 10, 2024

Pamela Stahl is the President of Avalon Healthcare Solutions. You’ve heard of pharmacy benefits managers (PBMs) but Avalon is a labs benefits management company. Working on behalf of health insurers Avalon ensures that patients are getting the right labs at the right price, . Why are they needed? There are 14 billion lab tests and they drive a lot of health care decisions (70%+!). As you might guess there’s a ton of variation in test price, lots of test are ordered in error, many are repeated, and many are unnecessary. Avalon’s job is to figure that all out!–Matthew Holt

Innovators: Avoid Health Care

Jun 18, 2024

By KIM BELLARD

NVIDIA founder and CEO Jensen Huang has become quite the media darling lately, due to NVIDIA’s skyrocketing market value the past two years ($3.3 trillion now, thank you very much. A year ago it first hit $1 trillion). His company is now the world’s third largest company by market capitalization. Last week he gave the commencement speech at Caltech, and offered those graduates some interesting insights.

Which, of course, I’ll try to apply to healthcare.

Mr. Jensen founded NVIDIA in 1993, and took the company public in 1999, but for much of its existence it struggled to find its niche. Mr. Huang figured NVIDIA needed to go to a market where there were no customers yet – “because where there are no customers, there are no competitors.” He likes to call this “zero billion dollar markets” (a phrase I gather he did not invent).

About a decade ago the company bet on deep learning and A.I. “No one knew how far deep learning could scale, and if we didn’t build it, we’d never know,” Mr. Huang told the graduates. “Our logic is: If we don’t build it, they can’t come.”

NVIDIA did build it, and, boy, they did come.

He believes we all should try to do things that haven’t been done before, things that “are insanely hard to do,” because if you succeed you can make a real contribution to the world. Going into zero billion dollar markets allows a company to be a “market maker, not a market-taker.” He’s not interested in market share; he’s interested in developing new markets.

Accordingly, he told the Caltech graduates:

I hope you believe in something. Something unconventional, something unexplored. But let it be informed, and let it be reasoned, and dedicate yourself to making that happen. You may find your GPU. You may find your CUDA. You may find your generative AI. You may find your NVIDIA.

And in that group, some may very well.

He didn’t promise it would be easy, citing his company’s own experience, and stressing the need for resilience. “One setback after another, we shook it off and skated to the next opportunity. Each time, we gain skills and strengthen our character,” Mr. Huang said. “No setback that comes our way doesn’t look like an opportunity these days… The world can be unfair and deal you with tough cards. Swiftly shake it off. There’s another opportunity out there — or create one.”

He was quite pleased with the Taylor Swift reference; the crowd seemed somewhat less impressed.

Blue Shield CA, CVS Caremark & the mystery of the extra $116, with 2 UPDATES (at the end)

Jun 3, 2024

By MATTHEW HOLT

Today we’re going to have fun with show and tell. I’m going to show you how a little corner of American health care is making my life as a consumer worse and more expensive–hopefully someone can tell me why.

The cast members are: me, my MD, the (sort of) independent pharmacy that delivers, Alto, and my insurer Blue Shield of California and its PBM CVS Caremark, which also owns a mail order pharmacy.

The brief backstory: For some years my doctor has been whining about my high cholesterol, and a few years back I went on a statin called Rosuvastatin Calcium. Older readers may remember Jean Luc Picard himself advertising the branded version Crestor, but it’s been off patent for about a decade. About 50 million Americans now take a statin, almost all of them a generic, including many 60 year old males like me. My cholesterol has come down, but my MD told me it could come down more, so a few months ago we boosted the dose to 40mg from 20mg.

Until recently I’d been insured by BCBS Massachusetts, and you might recall a little over a year ago I wrote a piece on THCB about the fun and games to be had trying to figure out what their PBM (CVS Caremark) was doing with the pricing of my kid’s ADHD medication. But they’d never messed with my medication as my statins are cheap. At least I thought they were. In fact as recently as April last year, they were free. You can see the price from the delivery from Alto Pharmacy below.

How BCBS Mass came up with $0.00 as the price I pay I don’t know, but presumably they think it’s a good thing to have me on statins in the hope I don’t have an (expensive) heart attack instead.

Then for some reason my price for the statin later the same year went up to $23. No longer $0 but at $8 a month not really worth making a fuss about.

At the end of the year, COBRA expired and I went to buy insurance on the California exchange. And in order to keep access to my family’s doctors at One Medical, I chose the only plan they were in, the Blue Shield of California HMO.

My next 90 day supply was the first one which went from 20mg to 40mg, but it’s still a common generic. Blue Shield of California also uses CVS Caremark (although it’s been talking a good game of ditching CVS Caremark and setting up its own PBM) and the cost at Alto barely budged. Now it was $28.

What happened next: So all was going normally until late last week when my next 90 supply was delivered. Except it wasn’t. Alto delivered me a 30 day supply and charged me $19.

What the Walmart Exit from Primary Care Means

May 27, 2024

By JEFF GOLDSMITH

There has been a lot of commentary on the largest “disrupter” candidate in healthcare, retail giant Walmart, throwing in the towel on their primary care clinic and virtual health businesses. As someone who has watched “retail health” for close to forty years, Walmart’s decision did not surprise me. This is disciplined company that has chosen its niches in healthcare carefully. And the fact that they could not make primary care work with their customer base makes all the sense in the world.

I am a Walmart shopper. I visit my local Walmart at least once a week, and buy all my commodity items there, where they are cheaper than anywhere else in town. I also buy my drugs at Walmart, and got all my immunizations (including four COVID shots) from their pharmacy. I love my local Walmart- linoleum, fluorescent lighting and all.

The shoppers in Walmart that I see every week are not “poor”. They are a cross section of the community I live in. If I am accused of a crime, they are the “jury of my peers” that I will see in court. What I see in Walmart: signs of serious family financial stress, a product of a near twenty percent increase in the cost of everything since the pandemic began. They are in Walmart for the same reason I am: they hate wasting money and their shopping dollar goes further in Walmart than anywhere else in the community. I will wager that every single uninsured person in the US, perhaps more than 32 million after the post-COVID Medicaid purge, is a Walmart shopper!

Walmart never articulated exactly the strategy behind its clinics. Primary care was never going to be profitable as a stand alone product, but rather was going to be a loss leader to something else: more prescriptions for its pharmacy, (like CVS?), more pull-through from products required by diagnoses, longer store visits. Or, as some suggested, Walmart’s clinics could have been a potential entry point into a yet-to-be-acquired Medicare Advantage plan (Humana or CIGNA were both in play), or a collaboration with MA giant, United Healthcare. Whatever the benefits expected, early losses far exceeded forecasts.

Walmart clearly underestimated the revenue cycle overhead associated with accepting Medicaid or Medicare, despite retaining OptumInsight to help with their revenue cycle issues. Walmart also likely overestimated both volumes and the cash yield on what they intended to be $40 primary care visits. Many health plans unthinkingly apply a copayment to primary care visits, an increasingly potent demand destroyer in this inflationary age. That copay or the full $40 for the abovementioned uninsured folks was going to have to compete for increasingly scarce paycheck dollars with everything in that cart. In that competition, medical care is probably going to end up being deferred, until it becomes unavoidable. And when it is unavoidable, they will go to the “unavoidable” healthcare place, their local hospital ED.

What Walmart said & What Walmart Did: Not the same thing

May 1, 2024

Walmart surprised us all and changed its mind about primary care yesterday. It’s out.

Because so few people have seen it I want to show what Walmart‘s head of health care said just 18 months ago (Nov 2022). Today they are finally killing off the 6th different strategy they’ve had (maybe it was 4). I guess (unlike CVS & Walgreens) they don’t have to write down investment in Oak Street or VillageCare, but they never worked out that primary care is only profitable if it’s 1) very low overhead 2) a loss leader for more expensive services (as most hospitals run it) or 3) getting a cut of the $$ for stopping more expensive services (Oak Street, Chenmed, Kaiser).

At HLTH 18 months ago I interviewed Cheryl Pegus who was then running Walmart and I asked why anyone should trust them, given how often they changed. Sachin H. Jain, MD, MBA Jain answered for her and said, “because they have Cheryl!” — Cheryl then said, “at Walmart the commitment to delivering health care is bigger than anywhere I have ever worked”. “Right now I have 35 centers in 3 years I’ll have 100s” see 11.00 onwards in the video below, although the whole thing is worth a look

Cheryl though left Walmart THE NEXT WEEK!

If data is the new oil, there’s going to be war over it

Apr 15, 2024

By MATTHEW HOLT

I am dipping into two rumbling controversies that probably only data nerds and chronic care management nerds care about, but as ever they reveal quite a bit about who has power and how the truth can get obfuscated in American health care.

This piece is about the data nerds but hopefully will help non-nerds understand why this matters. (You’ll have to wait for the one about diabetes & chronic care).

Think about data as a precious resource that drives economies, and then you’ll understand why there’s conflict.

A little history. Back in 1996 a law was passed that was supposed to make it easy to move your health insurance from employer to employer. It was called HIPAA (the first 3 letters stand for Health Insurance Portability–you didn’t know that, did you!). And no it didn’t help make insurance portable.

The “Accountability” (the 1st A, the second one stands for “Act”) part was basically a bunch of admin simplification standards for electronic forms insurers had been asking for. A bunch of privacy legislation got jammed in there too. One part of the “privacy” idea was that you, the patient, were supposed to be able to get a copy of your health data when you asked. As Regina Holliday pointed out in her art and story (73 cents), decades later you couldn’t.

Meanwhile, over the last 30 years America’s venerable community and parochial hospitals merged into large health systems, mostly to be able to stick it to insurers and employers on price. Blake Madden put out a chart of 91 health systems with more than $1bn in revenue this week and there are about 22 with over $10bn in revenue and a bunch more above $5bn. You don’t need me to remind you that many of those systems are guilty with extreme prejudice of monopolistic price gouging, screwing over their clinicians, suing poor people, managing huge hedge funds, and paying dozens of executives like they’re playing for the soon to be ex-Oakland A’s. A few got LA Dodgers’ style money. More than 15 years since Regina picked up her paintbrush to complain about her husband Fred’s treatment and the lack of access to his records, suffice it to say that many big health systems don’t engender much in the way of trust.

Meanwhile almost all of those systems, which already get 55-65% of their revenue from the taxpayer, received additional huge public subsidies to install electronic medical records which both pissed off their physicians and made several EMR vendors rich. One vendor, Epic Systems, became so wealthy that it has an office complex modeled after a theme park, including an 11,000 seat underground theater that looks like something from a 70’s sci-fi movie. Epic has also been criticized for monopolistic practices and related behavior, in particular limiting what its ex-employees could do and what its users could publicly complain about. Fortune’s Seth Joseph has been hammering away at them, to little avail as its software now manages 45%+ of all encounters with that number still increasing. (Northwell, Intermountain & UPMC are three huge health systems that recently tossed previous vendors to get on Epic).

Meanwhile some regulations did get passed about what was required from those who got those huge public subsidies and they have actually had some effect. The money from the 2009 HITECH act was spent mostly in the 2011-14 period and by the mid teens most hospitals and doctors had EMRs. There was a lot of talk about data exchange between providers but not much action. However, there were three major national networks set up, one mostly working with Epic and its clients called Carequality. Epic meanwhile had pretty successfully set up a client to client exchange called Care Everywhere (remember that).

Then, mostly driven by Joe Biden when he was VP, in 2016 Congress passed the 21st Century Cures Act which among many other things basically said that providers had to make data available in a modern format (i.e. via API). ONC, the bit of HHS that manages this stuff, eventually came up with some regulations and by the early 2020’s data access became real across a series of national networks. However, the access was restricted to data needed for “treatment” even though the law promised several other reasons to get health data.

As you might guess, a bunch of things then happened. First a series of VC-backed tech companies got created that basically extract data from hospital APIs in part via those national networks. These are commonly called “on-ramp” companies. Second, a bunch of companies started trying to use that data for a number of purposes, most ostensibly to deliver services to patients and play with their data outside those 91 big hospital systems.

Which brings us to the last couple of weeks. It became publicly known among the health data nerd crowd that one of the onramp companies, Particle Health, had been cut off from the Carequality Network and thus couldn’t provide its clients with data.

Wait Till Health Care Tries Dynamic Pricing

Mar 12, 2024

By KIM BELLARD

Nice try, Wendy’s. During an earnings call last month, President and CEO Kirk Tanner outlined the company’s plan to try a new form of pricing: “Beginning as early as 2025, we will begin testing more enhanced features like dynamic pricing and day-part offerings along with AI-enabled menu changes and suggestive selling.”

None of the analysts on the call questioned the statement, but the backlash from the public was immediate — and quite negative. As Reuters described it: “the burger chain was scorched on social media sites.”

Less than two weeks later Wendy’s backtracked – err, “clarified” – the statement. “This was misconstrued in some media reports as an intent to raise prices when demand is highest at our restaurants,” a company blog post explained. “We have no plans to do that and would not raise prices when our customers are visiting us most.”

The company was even firmer in an email to CNN: “Wendy’s will not implement surge pricing, which is the practice of raising prices when demand is highest. This was not a change in plans. It was never our plan to raise prices when customers are visiting us the most.”

OK, then. Apology accepted.

At this point it is worth explaining a distinction between dynamic pricing and the more familiar surge pricing. As Omar H. Fares writes in The Conversation: “Although surge pricing and dynamic pricing are often used interchangeably, they have slightly different definitions. Dynamic pricing refers to any pricing model that allows prices to fluctuate, while surge pricing refers to prices that are adjusted upward.”

Uber and other ride sharing services are well known for their surge pricing, whereas airlines’ pricing is more dynamic, figuring out prices by seat by when purchased by who is purchasing, among other factors.

Wendy’s wouldn’t be the first company to use dynamic pricing and it won’t be the last. Drew Patterson, co-founder of restaurant dynamic pricing provider Juicer, told The Wall Street Journal that dozens of restaurant brands used his company’s software. The company’s website doesn’t publicize those brands, of course. Still, he emphasized: “You need to make it clear that prices go up and they go down.”

Dave & Busters is public about its pricing strategy. “We’re going to have a dynamic pricing model, so we have the right price at the right time to match the peak demand,” Dave & Buster’s CEO Chris Morris said during an investor presentation last year. On the other hand, Dine Brands (Applebee’s/IHOP) Chief Executive John Peyton said. “We don’t think it’s an appropriate tool to use for our guests at this time.”

The potential revenue benefits are obvious, but there are risks, as Wendy’s quickly found out. Mr. Fares says: “One of the biggest risks associated with dynamic pricing is the potential negative impact on customer perception and trust. If customers feel that prices are unfair or unpredictable, they may lose trust in the brand.”

What Wendy’s tried to announce is not ground-breaking. Catherine Rampell pointed this out in a Washington Post op-ed:

In other words, things will be cheaper when demand is low to draw in more customers when there’s otherwise idle capacity. Lots of restaurants do this, including other burger chains. It’s usually called “happy hour.” Or the “early-bird special.” Non-restaurants do it, too. Think the weekday matinee deals at your local movie theater or cheaper airfares on low-traffic travel days.

Indeed, The Wall Street Journal reported: “An estimated 61% of adults support variable pricing where a restaurant lowers or raises prices based on business, with younger consumers more in favor of the approach than older ones, according to an online survey of 1,000 people by the National Restaurant Association trade group.”

I wonder what the support would have been if the question had been about healthcare instead of restaurants.

Patients are Not “Consumers”: My Cancer Story

Dec 5, 2023

By JEFF GOLDSMITH

On Christmas Eve 2014, I received a present of some profoundly unwelcome news: a 64 slice CT scan confirming not only the presence of a malignant tumor in my neck, but also a fluid filled mass the size of a man’s finger in my chest cavity outside the lungs. Two days earlier, my ENT surgeon in Charlottesville, Paige Powers, had performed a fine needle aspiration of a suspicious almond-shaped enlarged lymph node, and the lab returned a verdict of “metastatic squamous cell carcinoma of the head and neck with an occult primary tumor”.

I had worked in healthcare for nearly forty years when cancer struck, and considered myself an “expert” in how the health system worked. My experience fundamentally changed my view of how health care is delivered, from the patient’s point of view. Many have compared their fight against cancer as a “battle”. Mine didn’t feel like a battle so much as a chess match where the deadly opponent had begun playing many months before I was aware that he was my adversary. The remarkable image from Ingmar Bergman’s Seventh Seal sums up how this felt to me.

The CT scan was the second step in determining how many moves he had made, and in narrowing the uncertainty about my possible counter moves. The scan’s results were the darkest moment: if the mysterious fluid filled mass was the primary tumor, my options had already dangerously narrowed. Owing to holiday imaging schedules, it was not until New Years’ Eve, seven interminable days later, that a PET/CT scan dismissed the chest mass as a benign fluid-filled cyst. I would require an endoscopy to locate the still hidden primary tumor somewhere in my throat.

I decided to seek a second opinion at my alma mater, the University of Chicago, where I did my doctoral work and subsequently worked in medical center administration.

The University of Chicago had a superb head and neck cancer team headed by Dr. Everett Vokes, Chair of Medicine, whose aggressive chemotherapy saved the life and career of Chicago’s brilliant young chef, Grant Achatz of Alinea, in 2007.

If surgery was not possible, Chicago’s cancer team had a rich and powerful repertoire of non-surgical therapies. I was very impressed both with their young team, and how collaborative their approach was to my problem. Vokes’ initial instinct that mine was a surgical case proved accurate.

The young ENT surgeon I saw there in an initial consultation, Dr. Alex Langerman performed a quick endoscopy and thought he spotted a potential primary tumor nestled up against my larynx. Alex asked me to come back for a full-blown exploration under general anaesthesia, which I did a week later. The possible threat to my voice, which could have ended my career, convinced me to return to Chicago for therapy. Alex’s endoscopy found a tumor the size of a chickpea at the base of my tongue. Surgery was scheduled a week later in the U of Chicago’s beautiful new hospital, the Center for Care and Discovery.

This surgery was performed on Feb 2, 2015, by a team of clinicians none of whom was over the age of forty. It was not minor surgery, requiring nearly six hours: resections of both sides of my neck, including the dark almond and a host of neighboring lymph nodes. And then, there was robotic surgery that removed a nearly golf ball-sized piece of the base of my tongue and throat. The closure of this wound remodeled my throat.

I arrived in my hospital room late that day with the remarkable ability to converse in my normal voice.

Amazon Can Still Surprise Me

Nov 28, 2023

By KIM BELLARD

It’s Cyber Monday, and you’ve probably been shopping this weekend. In-stores sales on Black Friday rose 2.2% this year, whereas online sakes rose almost 8%, to $9.8b – over half of which was via mobile shopping. Cyber Monday, though, is expected to outpace Black Friday’s online shopping, with an estimated $12b, 5.4% higher than last year.

Lest we forget, Amazon’s Prime Day is even bigger than either Cyber Monday or Black Friday.

All that shopping means lots of deliveries, and here’s where I got a surprise: according to a Wall Street Journal analysis, Amazon is now the leading (private) delivery service. The analysis found that Amazon has already shipped some 4.8 billion packages door-to-door, and expects to finish the year with some 5.9bn. UPS is expected to have some 5.3bn, while FedEx is close to 3bn – and – unlike Amazon’s numbers — both include deliveries where the U.S. Postal Service actually does the “last mile delivery.”

Just a few years ago, WSJ reminds us, the idea that Amazon would deliver the most packages was considered “fantastical” by its competitors. “In all likelihood, the primary deliverers of e-commerce shipments for the foreseeable future will be UPS, the U.S. Postal Service and FedEx,” the then-CEO of Fed Ex said at the time. That quote didn’t age well.

Amazon’s growth is attributed in part to its contractor delivery program, whose 200,000 drivers (usually) wear Amazon uniforms and drive Amazon-branded vehicles, although they don’t actually work for Amazon, and a pandemic-driven doubling of its logistics network. WSJ reports: “Amazon has moved to regionalize its logistics network to reduce how far packages travel across the U.S. in an effort to get products to customers faster and improve profitability.”

It worked.

But I shouldn’t be surprised. Amazon usually gets good at what it tries. Take cloud computing. Amazon Web Services (AWS) in its early years was considered something of a capital sink, but now not only is by far the market leader, with 32% market share (versus Azure’s 22%) but also generates close to 70% of Amazon’s profits.

Prime, Amazon’s subscription service, now has some 200 million subscribers worldwide, some 167 million are in the U.S. Seventy-one percent of Amazon shoppers are Prime members, and its fees account for over 50% of all U.S. paid retail membership fees (Costco trails at under 10%). There’s some self-selection involved, but Prime members spend about three times as much on Amazon as nonprime members.

The world’s biggest online retailer. The biggest U.S. delivery service. The world’s biggest cloud computing service. The world’s second largest subscription service (watch out Netflix!). It’s “only” the fifth largest company in the world by market capitalization, but don’t bet against it.

I must admit, I’ve been a bit of a skeptic when it comes to Amazon’s interest in healthcare. I first wrote about them almost ten years ago, and over those years Amazon has continued to put its feet further into healthcare’s muddy waters.