Costco will offer co-branded Medicare plans through SCAN in three states

Costco is moving into Medicare enrollment with a partnership that will place co-branded health plans directly in its stores. The company plans to team with SCAN, a nonprofit insurer, to sell Medicare plans in three states, with the programs marketed and offered inside Costco warehouses.

The announcement indicates an expansion of Costco’s longtime membership model into a regulated, high-volume financial and health category where eligibility, pricing and enrollment rules are tightly governed. Medicare is the federal health insurance program for people generally 65 and older and for certain younger individuals with disabilities. Medicare plans often take the form of Medicare Advantage, which is delivered through private insurers under federal rules, rather than as original Medicare administered directly by the government.

SCAN’s involvement matters because Medicare plan availability and terms are set through the insurer’s contracting and regulatory process, including submission and approval to offer specific products. Costco’s role, by contrast, would center on distribution: it can reach a large pool of eligible members at the point of decision, using its in-warehouse footprint instead of requiring shoppers to search for plans online or travel to separate enrollment offices.

A core part of the concept is the co-branding. Co-branded plans are designed to combine the insurer’s underwriting and compliance work with Costco’s brand recognition and traffic. For shoppers, it can simplify the shopping process by consolidating a major consumer decision, choosing a Medicare plan, into the retailer visit.

The details released so far, however, leave several practical questions unanswered. The information available does not specify which three states are included, what specific plan types will be offered in those markets, or when enrollment and sales are scheduled to begin. It also does not outline whether Costco will handle appointment scheduling, lead generation, or application processing in-store, or how the company will staff or train personnel for Medicare enrollment discussions.

Costco’s move also arrives at a time when Medicare-related competition continues to intensify. Insurers and retail channels alike are seeking ways to improve conversion of eligible beneficiaries, reduce churn, and gain scale in enrollment. Placing offers in warehouses aims to capture demand during the Medicare Annual Enrollment Period and other enrollment windows, when prospective enrollees compare options and decide on coverage for the upcoming year.

For now, investors and industry watchers will want clearer disclosure on the economics and governance of the partnership. Questions include whether Costco receives revenue through distribution fees, marketing arrangements, or other incentives, and how both partners will manage compliance and customer communications in a heavily regulated market. A further point to watch is whether the program stays limited to three states or broadens if early uptake is strong.