UNH, Anthem, CVS, Humana, Cigna, Centene all earn low single digit profit margins, are extremely heavily regulated, and deal with healthcare providers that frequently have monopolies in their region.
I doubt it is worth trying to get into that business to try and capture the extra 3% profit margin they are currently paying to a managed care organization (aka health insurer).
There is always waste clouding margin. The fact that all these big players cannot figure out how to wring it out and get more than a few percentage points of profit with 10+ years of experience and data means it must be very hard to identify and fix.
Tech can usually come in and clean house in a new business due to introducing highly scalable processes that drive down marginal costs to near zero. I do not see how that dynamic would be possible in the current healthcare business in the US involving patients, doctors, hospitals, government, and lots of bureaucracy due to the politics of how healthcare resources are allocated and who is liable.
My observation has been that employee tenure is a huge drag on the insurance side. These are generally jobs for life, with all the organizational problems and inertia that spawns. Consequently, the internal thinking goes, why work to wring blood from a stone when there's a zero chance the company or your job disappears if you don't? They optimize for stability, not efficiency.
I'd chalk the failure of tech to penetrate up to the lack of standard interfaces. The entire insurance-provider industry, after you pry the lid off and look closer, is essentially bespoke person-person for almost any transaction.
It's gotten better, but it's still a far cry away, compared to the industries tech is used to disrupting. And you can't Uber-ize everything because (a) labor supply is a high-skill position with credentialing and negotiating power & (b) regulation prohibits overly disruptive moves (thank god).
