Are Health Clubs Healthy?

Health clubs get a lot of new members around the New Year's Resolution season. While most of those resolutions will fail, the business model is a winner.

A few months ago, if you are like a lot of people, you made a New Year's resolution and signed up to belong to a “health” club. Some call it an athletic club, fitness club, a sports, or racquet club, others say a gym, depending on whether you are in a red state or a blue state. There are more than 34,000 of them in the US and competition for membership is fierce, since most who prepay to belong never use them.

Are they really that healthy? It turns out, like hospitals, many are not good for your health. When you throw in all the people on treadmills who are texting at the same time, then things get really dicey. Of course, some think we are all on a treadmill texting.

Calling a gym a “health club” is a misnomer and is a lot like calling the US sick-care system a “healthcare system.” In fact, there is not a lot of health going on. In fact, most users seem to stand around texting the person across the room at the free weights. Ask Byron at the front desk for an automatic blood pressure cuff so you can measure your progress reducing your high blood pressure and see what happens. Maybe you can get a referral if it's in network.

It turns out that exercise can extend your life expectancy and the return on investment is better than most biotech stocks. But, like most things, if not done in moderation, exercise can do more harm than good.

The one thing that physician entrepreneurs can learn from sick clubs, though, is their business model. Imagine using the “pay in advance” model for all care, not just cosmetic surgery. Isn't the point for patients to pay and not show up? It's like having fire insurance and never using it.