Costco is teaming up with Instacart to test one-hour free delivery of prescription drugs to its warehouse club members, according to CNBCand later confirmed by Business Insider.
The pilot program is limited to California and Washington state, according to CNBC, and it includes delivery to a Costco member’s home or office. Costco members in those states will be able to have their prescriptions sent out free in an hour if they spend at least $35. Below that threshold, there's a delivery charge that varies depending on how fast members want the delivery to arrive.
One Costco member who has used the service said he received a text earlier this month to offer him the medication delivery option as an alternative to picking up the medications in store, said CNBC. Updates to orders are provided via text message, which mirrors the experience of ordering groceries from Instacart, it said.
“Costco’s delivery offering might be the first part of a bigger jump into healthcare,” Forrester senior analyst, Arielle Trzcinski tells RIS. “Competitors including Sam’s Club recently announced buy-up plans to gain lower cost access to vision, dental, and virtual care services. While Costco needed to do something to support their members, this is not enough to draw members away from a competing retailer.”
The news also comes on the heels CVS’ announcement that it has made its first prescription deliveries by drone.
“This is a race to see who can deliver a service that will stick,” says Trzcinski. “Retailers are still in search of what the right delivery model looks like and very much in test and see mode.”
Unlike the drone service, Costco’s delivery service requires Instacart workers to pass a HIPAA certification training in order to be allowed to deliver medications, said CNBC, the delivery person will ask for proof of identity at the point of exchange.
“Delivery professionals require HIPAA training, which will likely slow deployment initially,” notes Trzcinski.