Dunkin’ Donuts to purchase Planet Fitness
What’s driving the recent surge of U.S. healthcare industry mergers and acquisitions? Healthcare providers are grappling with increasing demand for care as our population grows and ages, rising cost of drugs and medical treatments, and tighter government reimbursement for Medicare and Medicaid services. Many other market and regulatory forces play a role.
This all leads to a bottom-line squeeze that forces health and wellness providers to “get married” because “two can live cheaper than one,” aka, “achieve significant operational synergies”.
You can blame capitalist greed, or the failing Obamacare, or Trump making Obamacare fail, or the lack of a BernieCare single-payer system that works/doesn’t work in Canada and Europe. Maybe you cling to the pre-Obamacare system because you prefer the ER or being denied coverage or gouged if you have a preexisting condition; e.g., you’re alive. Maybe you despise the notion of government healthcare as creeping socialism while depending on taxpayer-funded Medicare or Medicaid while also complaining it’s not good enough.
The fact is, our healthcare system is in turmoil in part because we all expect the best medical care in the world, but we don’t want to pay what it actually costs. We demand Moët et Chandon at Miller High Life prices. The healthcare system somehow has to absorb the difference.
So CVS — basically a 7–11 with a pharmacy — wants to buy Aetna. Walmart wants to buy Humana. Local hospitals are merging into large “health systems.” Your doctor who once owned her practice is now part of a large group practice or she’s now a hospital system employee. Amazon threatens to big-foot healthcare players from retail pharmacy to employee health coverage, fueling the whole bigger-is-better trend to control costs by expanding volume.
Meanwhile, other healthcare mergers are in the works that nobody knows about but me:
· McDonald’s is buying Medtronics, the leading maker of cardiovascular technology. Customers can feel free to have the Big Breakfast with hotcakes, biscuit, scrambled eggs, sausage and hash browns at 1,350 calories, 65 grams of fat (25 saturated), 2,100 milligrams of sodium and 155 grams of carbs. Then walk over to the Medtronic kiosk to have a technician implant the patented Resolute Onyx 2.0mm Drug-Eluting Stent.
· In a similar vein, Dunkin’ Brands, owner of the popular doughnut chain and also Baskin Robbins, Krispy Kreme, Pizza Hut, KFC, Taco Bell and other fast-food leaders, is in talks to purchase several retail gym chains including LA Fitness, 24 Hour Fitness, Life Time Fitness, Planet Fitness, Equinox and Crunch.
Dunkin’ officials explained to investor analysts that consumers believe merely having a gym membership allows them to consume more junk food guilt-free. Many consumers determined to get fit also will purchase a lifetime membership on January 2 and go twice, fueling significant upside gross profit margin opportunities.
· The nation’s third-largest hospital system, Kaiser Permanente, has launched a retail acquisition spree, bidding for Starbucks, Panera Bread, “fast fashion” apparel seller H&M, Rite-Aid, Massage Envy, Ace Hardware, Best Buy and other leading chains.
“We want to make our hospitals a true destination, and not just when you or a loved one is injured or sick,” a Kaiser spokesperson said.
Analysts say the amount of time that family and friends are stuck milling around makes hospitals second only to airports — now known as “shopping malls with gates” — in vying for the highly valued captive consumer who eats and shops out of boredom.
· Viagra-maker Pfizer is acquiring Ocean Spray, the cranberry juice maker, for reasons I will not get into.
· Smith & Wesson is buying Pinkerton, a leading disaster management and response service company. So when mass gun murders occur, if a Smith and Wesson semi-automatic assault weapon is involved, Pinkerton can save lives and restore order while its Reputation Management Triage Team quickly provides talking points to Congress and Fox News to ensure nobody blames the weapon.
· Altria/Philip Morris is in the process of taking over the boards of the American Heart Association, the American Lung Association, and the American Cancer Society for obvious reasons, but also Save the Children Federation because, a company spokesperson said, “children are our future.”
· The Container Store is acquiring HCA Behavioral Health Services, one of the nation’s fastest-growing acute care psychiatric providers. Obsessive Compulsive Disorder, described as “ordering and arranging things in a particular, precise way,” is a DSM-5 malady that The Container Store enables, and as such, the company seeks to be “part of the solution,” a spokesperson said.
· The Trump Organization (“Trump Luxury Real Estate redefines what is meant by luxury living, built to be the absolute best in the world”) similarly is in talks to take over the American Society of Colon and Rectal Surgeons.
The deal will reduce legal and other costs of “rectifying” matters when investors, contractors, workers and the public get screwed up the ying-yang or the wazoo.
· Former President Barack Obama has purchased the rights to the name “Obamacare” and announced winning takeover bids for every major health insurance company including UnitedHealth, Wellpoint, Kaiser, Cigna, CVS-Aetna and Walmart-Humana.
The new ObamacareCorp will offer all applicants comprehensive coverage including drug and maternity benefits, welcome people with preexisting conditions at no extra cost, cap out-of-pocket spending, hold down costs for older people, and subsidize low- and moderate income families to help them afford premiums.
Fox Business criticized the ObamacareCorp plan, calling it, “Socialism in a business suit.”
Jeffrey Denny is a Washington writer