One Medical went public on January 31, 2020, and on February 1, 2022, I said Amazon or Walmart would buy them. Today, Amazon announced it will purchase One Medical for $18 per share or $3.9 Billion including debt, that’s a 76% premium to yesterday’s closing price…if you own the stock, good for you!
What’s significant about this move isn’t Amazon’s access to patient data, but the digital innovation and reinvention of the patient experience that One Medical has brought to the market.
Most analysts on the Street long believed that One Medical is not a sustainable story because of the time their doctors spend with patients and the operational challenges of hiring physicians, nurses, and staff and having them work in a unique model that’s largely unfamiliar to healthcare. But despite conventional thinking, One Medical has invested in its digital infrastructure to deliver an exceptional patient experience and make it easier for providers to do their jobs and therefore spend the time necessary with their patients. One Medical patients have a high affinity for the brand because they can see the doctor on their device or walk in. I reiterate, that this doesn’t happen without proper investment in the digital experience and ensuring the right talent is working on solving those problems.
“We think healthcare is high on the list of experiences that need reinvention,” said Neil Lindsay, senior vice president of Amazon Health Services in the press release this morning. That reinvention, in large part, is the bringing together of the digital and human experience in healthcare that One Medical has achieved and will continue to improve, which makes patients more “sticky” and loyal to their doctor. In an era where changing practices is a Google search away, this is a huge advantage.
I will continue with my predictions: Amazon, Walmart and the big players will continue to buy…they will shop for dental, veterinary and other medical specialties that have girth and high margins (perhaps dermatology, plastic surgery, etc.) but only those that mirror or exceed One Medical’s digital patient experience.
As we continue to follow, we continue to learn and we will share our perspective to help put your healthcare business in a better position