Atul Gawande’s announcement last week that he was stepping down as CEO of a high-profile health venture created by the leaders of Amazon, JPMorgan Chase, and Berkshire Hathaway, came after a frustrating two years marked by high turnover in key positions, potential duplication with the work of one of its founding companies, and halting progress toward its goals, a STAT examination has found.
Gawande, a celebrated surgeon, health policy thinker, and writer, recruited top talent to the health care startup, known as Haven. But several people with knowledge of its operations said the company struggled to retain many of the new hires, including data scientists and software engineers. Several employees left to join the three companies that founded Haven in the first place. In February alone, 8% of Haven workers with public profiles on LinkedIn reported leaving the company.
For an enterprise that was announced with tremendous fanfare, and that has been run by a very public figure, Haven has been remarkably secretive in its operations. But in interviews with STAT, outside experts knowledgeable about Haven as well as a former employee at the venture revealed new details: They said high turnover has disrupted efforts to build the company as it sought to define a clear business strategy in a highly competitive market. In some cases, they said, Haven’s initiatives have overlapped substantially with the health benefits work within Amazon, which has launched a new primary care program for its Seattle-area employees.
Confronting these difficulties was a CEO who, for all his professional accomplishments, was a newcomer at running a complex business venture, and a high profile one at that. Gawande readily acknowledged to colleagues that this was a new challenge.
“Atul was very transparent,” about his lack of experience in business, the former employee said on condition of anonymity, citing a nondisclosure agreement. “We’d have all-hands meetings every week, and he’d get up there and say, ‘I just learned what a Series A is.’”
Gawande, who joined Haven in July 2018, declined STAT’s request for an interview. Haven did not answer questions about the specific focus of the company’s work or even the number of employees in its offices in Boston and New York. But a spokeswoman, Brooke Thurston, disputed that the turnover was concerning. “As is commonplace for a start-up organization, we have had some natural attrition and made some staffing changes,’’ she said, “We continue to recruit top talent to join our organization.’’ And, she added, Gawande, as “a leading public health expert, surgeon and academic,’’ is “certainly familiar” with how Series A funding works.
From the moment they announced their enterprise in January 2018, the corporate chiefs Jamie Dimon, Jeff Bezos, and Warren Buffett put forth a bold vision centered around using technology to improve access to quality health care and reduce costs for its employees. While Haven has shared few results of its initiatives so far, business and health care experts said it could still make a tangible impact, assuming it finds — and keeps — the right leaders for the job.
Several health care and business leaders from startups and top-tier universities said they had long harbored doubts that Gawande, despite his gleaming reputation, could effectively execute the day-to-day operational tasks that come with running a health care startup.
A year ago, Gawande pledged to be “relentless” in pursuit of better health care and to ensure “our work has high impact.” But he announced last week that he would depart as CEO and move to an advisory role as chairman of the company’s board of directors, describing it as a better fit. The decision came a few weeks before his leave of absence would have ended as a professor at the Harvard T.H. Chan School of Public Health, which does not allow professors to retain their positions if absences extend beyond two years.
Gawande said in his announcement that he wanted to focus on policy and advocacy activities “addressing the immediate and long-term threats to health and health systems from COVID-19.” But some business experts said his exit indicated that Gawande didn’t think Haven was nimble enough to respond to the pandemic with innovative uses of technology to connect patients and care providers.
“If Haven were smart, they’d figure out how to seize on this moment and the rise of telehealth,” Kimberly MacPherson, the executive director of health management at the University of California at Berkeley Haas School of Business and the co-director of Berkeley’s center for health technology.
STAT’s reporting was based on interviews with one former employee and several acquaintances of Gawande’s who spoke about the struggles he faced at the company. They asked not to be named because of concerns about damaging their professional relationships. Reporters also spoke with several outside business experts who discussed the challenges the company must overcome to significantly improve health care.
Haven’s stated mission has been to improve care for the 1.2 million employees of its three founding companies, and incubate solutions that could benefit patients across the country. The three CEOS who announced the effort — Bezos of Amazon, Buffett of Berkshire Hathaway, and Dimon of JPMorgan — have not been deeply involved in guiding the company, leaving oversight and coordination to executives within their respective companies, according to one person with knowledge of the company’s operations. That meant Gawande had to reconcile differences in the cultures and operations of those companies to try to change health benefits and access to care. (Thurston, the Haven spokeswoman, said, “We are working very closely with our Founders and have an active and engaged Board of Directors.”)
Another person familiar with Haven said its operations have overlapped with the work of some of the founding companies — especially Amazon, which has pursued its own parallel effort to improve health benefits.
“There have been instances in which Amazon’s plans were not shared with the Haven group,” this person said, adding that Amazon has an imperative to keep apace with health benefit upgrades offered by competitors like Walmart and could not wait for the longer-term solutions being pursued by Haven.
In September 2019, the e-commerce giant launched Amazon Care, a primary care program for some of its Seattle-based employees that includes access to telemedicine checkups, at-home or in-office visits with doctors, and prescription deliveries. It recently expanded the program to include its warehouse workers in the Seattle area.
That effort takes a big chip off the table for Haven, since its founding companies don’t have a large concentration of employees outside Seattle to wrest concessions from providers, such as lower costs for medical services and improved access to care.
In recent months, the bulk of Haven’s work has focused on crunching data on the use of health care services by its employees and identifying the biggest drivers of cost. That is part of a broader effort to address workers’ health issues before they spiral into more expensive problems.
While he was CEO, Gawande made several trips to visit with employees of the three companies around the country. The former employee said those trips led to some of the few pilot programs that have been launched by Haven, including a health insurance offering for JPMorgan employees that offers financial incentives for healthy behaviors and a menu of fixed costs for medical services.
The former employee said that while Haven attracted high-level talent, its not-for-profit structure made it difficult to retain people because it could not offer stock options and competitive benefit packages. As a result, Haven’s staff, which numbers 80 according to LinkedIn, has been hampered by comings and goings, including among the top executive ranks.
Including Gawande, three of the six people on the leadership team Haven outlined a year ago have now left. Jack Stoddard, who became Haven’s chief operating officer after serving as general manager for digital health at telecommunications giant Comcast, departed last July after less than a year on the job. Megan McLean — who joined Haven as chief of staff after serving in the same role at Ariadne Labs, the health innovation startup Gawande founded — left earlier this month, according to LinkedIn. McLean’s duties are now being filled by Thurston, who is also the company’s head of communications.
The venture has also cycled through several mid-level managers and science and technology talent, including two seemingly high-profile scientists who departed Haven between April and May, according to LinkedIn.
Following Gawande’s departure, daily operations will be managed by Mitch Betses, who started as the company’s chief operating officer in March, the company said. Prior to Haven, Betses spent 23 years working for CVS Health, where he served as a senior vice president for government services with the company’s pharmacy benefit management arm.
Haven has also hired other managers with experience in pharmacy benefits management, including Steve Michurski, who was hired this month to be a general manager at the company focused on pharmacy benefits management.
While Haven has said a large part of its focus will be lowering the cost of prescription drugs for employees, a spokesperson said the company is not looking to build its own PBM.
In one of his few public appearances about the venture, at Aspen in June of 2018, Gawande spoke excitedly about its mission — as well as the tremendous challenge.
“It is amazing to me that I would get to partner with people like Jeff Bezos, Warren Buffett, and Jamie Dimon — amazing people who have committed themselves to the long term,” he said. “But the largest concept here is that I get to have a million patients that I as a doctor get to add to my responsibility, and my job for them is to figure out ways that we’re going to drive better outcomes, better satisfaction with care, and better cost efficiency with new models that can be incubated for all. That is a tall fricking order. But what they’re saying to me is that resources won’t be the problem. Human behavior will be. And achieving scale will be.”
“STAT’s reporting was based on interviews with one former employee and several acquaintances of Gawande’s …” Enuf said. At some point, we’ll get the actual story of what’s going on.
If these companies were serious they would’ve hired a former hospital CEO or executive who had run a big system. The vast majority of money spent by the companies’ health benefits programs is still spent on hospital care–much of which is often priced vastly differently and of uneven quality. Somebody from the hospital industry with operations experience could’ve defined a clear path forward for them; understood how technology could change paradigms; and, how employee benefit programs can influence employee behaviors. A high profile thinker and surgeon was the wrong choice all along.
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