Amazon is diving into health care. 

The world's biggest internet retailer on Tuesday announced plans to team up with the massive conglomerate Berkshire Hathaway and banking titan JPMorgan Chase to form a new company focused on improving the health of all three companies' US employee bases. The yet-to-be-named company will work to reduce costs and provide simplified health care to employees with the help of technology and will be "free from profit-making incentives and constraints."

"The ballooning costs of health care act as a hungry tapeworm on the American economy," said Warren Buffett, CEO of  Berkshire Hathaway, in a statement. "Our group does not come to this problem with answers. But we also do not accept it as inevitable."

With the three companies employing a total of over 1 million people worldwide, the immediate impact of the new venture -- once it gets going -- could be significant for many workers and their families. In the longer term, efforts from this company have the potential to shake up the extremely complex and costly health care system, perhaps helping reduce costs for more people if the venture finds ways to restrain expenses from insurers, hospitals or doctors.

But even with the brain power of three of the US' biggest companies, that's a big if. The Obama administration attempted to bring down health care costs with the Affordable Care Act, but results have been mixed, with premiums for some state marketplace plans increasing sharply. Whether Amazon and its partners can find more success in making changes to employee plans -- an area that was less impacted by the ACA -- remains to be seen.

The new company could also offer a beachhead for Amazon to break into health care and pharmaceuticals, areas the e-retailer has been rumored to be pursuing over the past few months.

Reaching into health care should help Amazon work itself into yet another part of its customers' lives, helping it expand its list of services that already include retail, groceries, streaming video, smart speakers and cloud storage, said Danny Silverman of e-commerce data provider Clavis Insight.

"They are playing for the entire ecosystem that surrounds shoppers and consumers, and in doing so, must have a stake in every key area of that ecosystem," he said. "With health care, they capture the next, most valuable layer of the ecosystem -- the system that keeps us well and healthy."

There's already skepticism, too, that this effort will actually be different. Cowen analyst Charles Rhyee said Tuesday the venture "doesn't appear to break any new ground."

"Better outcomes and lower costs could be the mission statement of most of health care today," he said, "and it's certainly a challenge that hasn't been solved."

There's a lot to be sorted out still beyond the broad goals. The new venture, which is in the early planning stages, will be jointly run by a leader from each of the three companies. The management team, the headquarters location and key operational details will be fleshed out later. Amazon is based in Seattle, while JPMorgan is in New York City and Berkshire is in Omaha, Nebraska.

Even with the meager details that the threesome offered Tuesday, the plan already appeared to contribute to a selloff in shares of insurers like UnitedHealth and drugstores like CVS. Amazon, which has a history of shaking up established fields, provoked a similar effect when it agreed to buy Whole Foods last year, driving down shares of rival grocers including Kroger and Costco.

With more details coming later on, right now it's all about setting direction and grabbing attention.

"The health care system is complex, and we enter into this challenge open-eyed about the degree of difficulty," Amazon CEO Jeff Bezos said in a statement. "Success is going to require talented experts, a beginner's mind, and a long-term orientation."

First published Jan. 30 at 4:51 a.m. PT.
Update, 7:49 a.m. PT: Adds more details throughout, along with analyst comment.

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