buckguy wrote: ↑January 8th, 2024, 9:50 am
HCal wrote: ↑January 8th, 2024, 3:46 am
ClownLoach wrote: ↑January 7th, 2024, 10:21 pm
Costco runs a 5% or less markup, so there's no way even a $300 basket could offset a big prescription. And furthermore they cannot legally exclude non members from using the pharmacy, at least not in California nor can they charge them more. So they must have something worked out where they're going to be reimbursed at a reasonable rate otherwise there is zero reason to take on this business.
Costco is an extremely profitable company. They can easily run the entire pharmacy operation as a loss leader and be just fine. I think their food courts and gas stations are also seen as more of a member service, with the main benefit being to encourage membership renewals.
I don't think it would be legal (never mind ethical) to lie about stock. If a Medicaid patient is told that X is out of stock and a patient with fancy insurance is then sold X, it would be very easy to detect and lead to a huge PR disaster.
The average Costco customer doesn't use the pharmacy, so it's impact on profit is probably negligible, overall. The couple times I went to a Costco for a prescription, there were no customers around at all and I rarely see prescription customers when I'm in the HBA section of their stores.
Depends on the area.
I have a diabetic relative who didn't have insurance (I have since helped them get insured) and they went to Costco pharmacy because the cash prices on their medications were 90% less than Rite Aid, Walgreens and CVS. This amounted to thousands of dollars for insulin savings alone. Every time we had to wait in a long prescription line and the store had run out of room to expand their prescription storage so they had reduced hold time to 7 days from 14 at this busy Signal Hill location. Since we have moved to Riverside County and her prescriptions were amongst the first at a brand new location which is also now adding additional racking for storage and more pharmacists and technicians; there are usually 6 to 8 people inside the pharmacy itself. They are far busier than any CVS or Walgreens I've been in except for a location on the opposite corner from 2 hospitals in OC. They also have a massive mail order operation and do the same work of moving most prescriptions to 90 day mail order. Since the addition of Medi-CAL acceptance they have been much busier. I do not agree with the idea that this is not a busy part of the business for Costco, it is in fact a very large sector for them and my understanding is that they're working on testing their version of "Minute Clinics" as part of a larger Healthcare expansion. The new warehouse prototype moves optical and pharmacy together to a corner butted up against each other to make this "Healthcare corner" and all of the related merchandise is together.
For Costco, the Food Court specifically the infamous hot dog is a member service where they break even or lose a little money, although with the conversion to all kiosk ordering they've reduced staffing a bit and now it's chaotic like the Sam's Cafe over there. Outdoor kiosk stores added membership scanners. The gas station is a specific revenue boosting program and Costco is still working aggressively to add stations to every store even if it means moves as drastic as tearing down the entire building and moving around on the lot (they were going to do exactly that in Tustin and had deferred store updates like LED light retrofit and even floor polishing, before finally reaching an agreement with local residents who were complaining about the proposed station). So gas stations are a very big deal for Costco. I think pharmacy is somewhere in the middle on their priorities.
One store that does not appear to do any business in pharmacy is Sam's Club despite promoting cheap 90 day supplies of many medications for Plus members, if I recall there is a long list where they give a 90 day fill in store or mail order for $5, very similar to the promotions we used to see in grocery stores. I don't see them doing any work besides the Plus member deal to drive traffic to this area and they do not merchandise it well either as they break up categories outside of that corner and merchandise elsewhere.
As far as pharmacy stock goes, I wouldn't be the least bit surprised if these stores "accidentally" allocated inventory to locations based on revenue.