Target and Ulta announce breakup

Summary

Marketplace Morning Report: Target and Ulta Announce Breakup
Release Date: August 15, 2025
Host: David Brancaccio

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1. Global Economic Strains and U.S.-Russia Relations

David Brancaccio opens the episode by addressing significant international developments affecting the global economy. Highlighting the imposition of the first international economic sanctions on Russia, Brancaccio underscores the gravity of these measures in the context of ongoing geopolitical tensions.

Steve Rosenberg, Russia editor with Marketplace’s newsroom partners at the BBC, provides an in-depth analysis of Russia's economic decline:

"The budget deficit is increasing. Oil and gas revenues are decreasing. Many branches of industry are approaching recession."
(01:27)

Rosenberg suggests that these economic challenges might be influencing President Vladimir Putin's willingness to negotiate, especially ahead of the scheduled meeting with President Trump in Anchorage. He posits that the deteriorating economic conditions could be prompting Putin to consider concessions and compromises:

"Perhaps this is the moment to make concessions, to make compromise."
(01:36)

2. End of the Target and Ulta Beauty Partnership

Transitioning to the retail sector, David Brancaccio reports on the dissolution of the partnership between Target and Ulta Beauty, a collaboration that began in 2021. This partnership involved housing 600 mini Ulta shops within Target stores, aiming to enhance Target’s beauty and wellness offerings while expanding Ulta’s brick-and-mortar presence.

Matt Levin from Marketplace provides context on the partnership's inception and eventual decline:

"Ulta was broadening its geographic footprint with a brick and mortar behemoth whose sales were soaring. But just like people, companies change."
(02:17)

Olivia Johnson, a retail professor at the University of Houston, draws parallels between corporate relationships and personal partnerships, emphasizing the impact of external factors such as inflation and political controversies on Target's performance:

"Inflation and political controversy have caused lackluster sales at Target the past couple years."
(02:35)

Jenny Liu from the Yale School of Management adds nuance to the discussion by contrasting the shopping experiences at Ulta and Target:

"You might go into Ulta for more of an experience, whereas with Target, you might be going to stock up on some frequently purchased items."
(03:21)

Levin concludes by highlighting the practical challenges of integrating beauty services within a general retail environment:

"It's hard to put a salon chair in a Target."
(03:29)

3. Mental Illness in Nursing Homes

David Brancaccio shifts focus to a pressing issue in healthcare: the prevalence of individuals with serious mental illnesses residing in nursing homes. Contrary to common perceptions, many nursing home beds are occupied by residents battling conditions like schizophrenia, bipolar disorder, or psychosis, rather than solely by the elderly.

Elizabeth Gothrop, a data journalist with APM Research Lab, elaborates on how systemic issues contribute to this trend:

"It usually starts with a hospital stint. Hospitals are supposed to discharge patients somewhere safe, and nursing homes are a relatively easy way for hospitals to check that box."
(04:36)

Gothrop raises concerns about the adequacy of care in these facilities for mental health patients:

"We found cases where people with mental illness hurt other people, which shouldn't happen if people are getting the right treatment and if there's enough staff."
(05:06)

She further highlights the financial incentives that inadvertently funnel mental health patients into nursing homes:

"The federal government won't let Medicaid dollars pay for psychiatric institutions. So states have to pick up the bill there. But feds will pay for nursing homes."
(05:57)

Addressing potential solutions, Gothrop points to the need for expanded community-based treatment programs:

"Advocates argue we should make it easier for Medicaid to pay for those programs. There's a provision in the Trump administration's tax and spending law that could help states with that."
(06:20)

However, she notes the complexities introduced by conflicting provisions within the same law:

"The law also has provisions that are likely to result in a lot of people on Medicaid losing their health insurance. So it's not clear how effective that'll be."
(06:50)

4. Costco's Stance on Abortion Pills

In the realm of healthcare and corporate responsibility, David Brancaccio reports that Costco has decided not to stock mifepristone, commonly known as the abortion pill, in its pharmacies within states where its sale is legal. Costco cites projected low demand, suggesting that most patients obtain the medication directly from their healthcare providers.

The decision comes amidst increasing pressure from anti-abortion groups targeting retailers and pharmacies to discontinue the supply of abortion medications. In contrast, major competitors like CVS and Walgreens have affirmed their commitment to providing mifepristone where it is legally permitted.

Brancaccio also mentions that Kroger, another major grocery and pharmacy chain, is currently reviewing its position on the matter, indicating potential shifts in retail pharmacy offerings related to reproductive health services.

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Conclusion

In this episode of the Marketplace Morning Report, David Brancaccio traverses a spectrum of critical topics, from global economic sanctions impacting U.S.-Russia relations to significant shifts in retail partnerships between Target and Ulta Beauty. He delves into the troubling trend of mental illness prevalence in nursing homes, uncovering systemic shortcomings and financial incentives that exacerbate the issue. Additionally, Brancaccio addresses Costco's controversial decision to cease stocking the abortion pill, reflecting the broader societal and corporate tensions surrounding reproductive healthcare.

Listeners gain a comprehensive overview of these multifaceted stories, enriched by expert insights and data-driven analysis, ensuring they are well-informed on the key economic and social developments shaping the current landscape.

Transcript

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[David Brancaccio]

How people with psychiatric conditions end up in nursing homes I'm David Brancaccio in Los Angeles. First international economic sanctions on Russia and the meeting in Alaska later today between Presidents Trump and Putin in Anchorage. Steve Rosenberg, Russia editor with our newsroom partners. The BBC says the state of the Russian economy may be part of the timing here.

[Steve Rosenberg]

The budget deficit is increasing. Oil and gas revenues are decreasing. Many branches of industry are approaching recession. The Russian newspapers write about this all the time. Even in a very controlled media landscape, it's very difficult to hide that. So I wonder whether this is the moment that Vladimir Putin has decided, well, the economic situation isn't great. Perhaps there's less money. Perhaps this is the moment to make concessions, to make compromise.

[David Brancaccio]

The BBC's Steve Rosenberg target Stores and Ulta Beauty have announced the corporate equivalent of what you might call a conscious uncoupling. Their store within a store partnership goes back to 2021. But within one year, the 600 mini Ulta shops inside Target will go. Marketplace's Matt Levin has that when Target.

[Matt Levin]

And Ulta announced they were shacking up together not so long after the pandemic hit, it was one of those couples that made sense on paper to Target was gaining a major brand in the beauty and wellness space that could bring higher end products to its shelves. And Ulta was broadening its geographic footprint with a brick and mortar behemoth whose sales were soaring. But just like people, companies change. We saw Target at the height of where they were at. They're not at their place anymore. Olivia Johnson is a retail professor at the University of Houston. When your partner starts to gain a little weight or their hairline starts to recede, you start to wonder, did I sign up for this forever? Inflation and political controversy have caused lackluster sales at Target the past couple years. Neither Target nor Ulta agreed to an interview request. Jenny Liu at the Yale School of Management says while the Ulta Target marriage was built on the idea of convenience, Ulta customers often go to stores for haircuts or a consultation with a makeup pro.

[Elizabeth Gothrop]

So you might go into Ulta for more of an experience, whereas with Target.

[Matt Levin]

You might be going to stock up.

[Elizabeth Gothrop]

On some frequently purchased items.

[Matt Levin]

And it's hard to put a salon chair in a Target. I'm Matt Levin for Marketplace.

[David Brancaccio]

The word nursing home suggests a place to live for an older person who can no longer care for themselves. But a surprising number of nursing home beds are going to people experiencing serious mental illness. It's not necessarily age, but conditions such as schizophrenia, bipolar disorder or psychosis that account for as much as 90% of the spots in some nursing homes. This from an investigation by APM Research Lab, part of our parent organization, American Public Media. Elizabeth. Elizabeth Gothrop is a data journalist there. Elizabeth, welcome.

[Elizabeth Gothrop]

Thank you, David.

[David Brancaccio]

How do so many people with mental illness find themselves in nursing homes?

[Elizabeth Gothrop]

Yeah, so it usually starts with a hospital stint. Hospitals are supposed to discharge patients somewhere safe, somewhere they can get the care that they need. And nursing homes are a relatively easy way for hospitals to check that box.

[David Brancaccio]

I see. This is not, say, an elderly patient with dementia where a properly equipped nursing home would be expected to be able to care for that patient. This might be what an able bodied person suffering from perhaps schizophrenia. Are nursing homes equipped to deliver appropriate.

[Elizabeth Gothrop]

Care in that case, it seems like many are not. We analyzed tons of government inspection records and we found some extreme cases in there. Sometimes people with mental illness were treated so poorly that they ended up in the hospital or even dead. And we found cases where people with mental illness hurt other people, which shouldn't happen if people are getting the right treatment and if there's enough staff. And it's not just that there are some isolated, extreme cases. We actually analyzed every home in the country and found that nursing homes with higher rates of mental illness were more likely to be cited for abuse.

[David Brancaccio]

And your work shows that financial incentives play a role in people with mental health conditions going to nursing homes instead of other health care facilities perhaps more appropriate for their care.

[Elizabeth Gothrop]

That's right. Part of this is basically that the federal government won't let Medicaid dollars pay for psychiatric institutions. So states have to pick up the bill there. But feds will pay for nursing homes. And we're talking about a lot of money. Medicaid pays roughly $6,000 a month for a person's nursing home stay.

[David Brancaccio]

What are ways being discussed to address this?

[Elizabeth Gothrop]

Studies have found that many people with mental illness don't need the kind of 24,7 care that nursing homes provide and that they could actually instead live in a house or apartment. In fact, institutions like nursing homes can actually make those conditions worse. But the problem is the kinds of treatment programs that allow people to stay in their homes aren't available everywhere and they often have long wait lists. So advocates for people with mental illness argue we should make it easier for Medicaid to pay for those programs. There's actually a provision in the Trump administration's big tax and spending law that could help states with that. But the law also has provisions that are likely to result in a lot of people on Medicaid losing their health insurance. So it's not clear how effective that'll be.

[David Brancaccio]

Right. That latter part something we've been covering. Elizabeth Gothrop, APM Research Lab, part of the same American Public Media group that owns Marketplace. Elizabeth, thank you for this.

[Elizabeth Gothrop]

Thanks so much for having me.

[David Brancaccio]

And the retail chain Costco has decided not to make available mifeprestone at its pharmacies in the states where the abortion pill is legal. The company says it projects low demand, indicating many patients get the pill from their medical providers. Retailers and pharmacies are facing pressure campaigns by anti abortion groups to stop filling these prescriptions. CVS and Walgreens say they'll still provide mifepressone where legal. The huge multi brand grocery chain Kroger's says it's reviewing its stance. In Los Angeles, I'm David Brancaccio. This is the Marketplace MORNING Report from apm, American Public Media.