Healthy Returns

Rising health-care costs a 'huge threat' to US economy: Cleveland Clinic's Toby Cosgrove

Key Points
  • The Amazon, Berkshire Hathaway and J.P. Morgan partnership is a signal to the private sector about the problems in health-care, Cosgrove says.
  • He believes it's a great opportunity to address rising costs.
  • Cosgrove is on the advisory board for CNBC's new health-care conference, Healthy Returns, on March 28 in New York City.
They're signaling to private sector the problem with health care: The Cleveland Clinic executive advisor

The new Amazon, Berkshire Hathaway and J.P. Morgan Chase partnership is a great opportunity to bring down costs in the health-care industry, Cleveland Clinic Executive Advisor Toby Cosgrove told CNBC on Tuesday.

The three companies announced Tuesday they will launch an independent operation aimed at reducing health-care costs and improving services for their U.S. employees.

In an interview with "Power Lunch," Cosgrove said the collaboration is a signal to the private sector about the problems in health care and the need to do something.

"The rising cost of U.S. health care is a huge threat to the U.S. economy," he said.

In fact, 20 percent of hospitals in the country are running in the red, he pointed out.

"We're working very hard to take costs out, and we've taken an enormous amount of costs out, but we need a more efficient system supporting us," said Cosgrove, who was CEO of the Cleveland Clinic from 2004 through 2017.

He believes the private sector should do things to reduce the costs because the system can't totally depend on the government to do so.

"They have to put wellness things in place. They have to begin to understand how people go to the correct providers. They have to begin to drive the efficiency of purchasing."

Earlier Tuesday on CNBC, Allergan Chief Executive Brent Saunders mentioned Cosgrove as a good potential CEO candidate for the new partnership.

Cosgrove said he hasn't had any discussions with any of the parties involved.

When asked if he'd be interested in such a role, he responded, "I'm always interested in talking to people about things I think help the U.S. economy and U.S. health care."