Costco Pilot Program Will Let Some Members Purchase Health Insurance
Costco officials have announced plans to launch a pilot program in Southern California next month that will let "executive" members purchase family or individual health insurance policies, the Los Angeles Times reports. The health insurance program will primarily target the self-employed or individuals who cannot enroll in health plans, such as contractors, waiters and students, according to officials (Vrana, Los Angeles Times, 6/9).
Costco said participants will pay deductibles of $1,500 for individuals and $3,000 for families. A second option with lower premiums will have an individual deductible of $3,000 and family deductible of $6,000.
Officials declined to disclose the amount of the premiums but said the policies will offer members savings of 5% to 20% by reducing commissions and administering policies electronically (Coleman-Lochner, Bloomberg News/Orange County Register, 6/10).
Premiums will vary depending on age, location and health status. Both health plans will include prescription drug coverage, and copayments for most office visits will be $35.
Initially the health plans will be offered at 34 Costco store in Los Angeles, Orange and parts of Riverside and San Bernardino counties. The plans will be sold over the Internet and through a call center (Los Angeles Times, 6/9).
The company expects to implement the program in all of its approximately 100 California stores by the end of this year.
Costco Assistant Vice President Dellanie Fragnoli said the wholesaler chose California because of favorable insurance regulations and the large number of Costco members (Bloomberg News/Orange County Register, 6/10).