SCAN Group and retailer Costco are expanding their partnership with the launch of new co-branded Medicare products.
The initial plans include a Medicare Advantage plan available in two states and Medicare supplement coverage in a third. The companies said the launch makes for Costco's "first comprehensive partnership" with an MA plan.
The partners plan to continue building out the suite of offerings over the next several years, per an announcement, and executives said these products could include a new pharmacy experience, over-the-counter benefits, vision, hearing and more. Further details are forthcoming pending a regulatory review.
SCAN and Costco first partnered in October 2025, agreeing to offer discounts on medications, vaccinations and key over-the-counter products.
Insurance plans teaming up with retailers or grocers also isn't new trend, but it's not uncommon for those relationships to flame out. Sachin Jain, M.D., CEO of SCAN Group, told Fierce Healthcare that this relationship bucks that trend as the two organizations are aligned on a core tenet of creating value for members.
Jain said that it's easy for one of these relationships to fall apart if the partners are more invested in generating value for themselves.
"We're not arguing about nickels with our friends at Costco," he said. "That's why this is a very different kind of relationship and a very different kind of partnership."
Part of the secret sauce, he said, is focusing on what each of the companies does the best. SCAN isn't going to become a grocery delivery business, and Costco isn't aiming to open a bunch of medical clinics, but they're instead focusing on their most complementary strengths.
For example, Medicare Advantage can be difficult for members to navigate and understand, and that has only gotten more complex with turmoil and confusion in the star ratings as well as a lack of clarity around what differentiates different benefits options.
With the co-branded plans, that shopping becomes easier, Jain said. Costco members already trust the retailer to curate the products available in their stores, and that comfort naturally extends to the plans.
"I think the benefit of this partnership is a simplification of the buying decision, because someone else has done the work for you, which I think is a remarkable benefit that we can provide to seniors who, oftentimes, age into Medicare very confused about what they should be doing," Jain said.
And both partners are coming to this with humility, he said. There will not doubt be growing pains, and they're committed to hearing directly from members about what's working and what's not to continue iterating.
Jain said approaching the partnership this way could serve as a model for future relationships between insurers and organizations like Costco.
"We're prepared to call our baby ugly, and work through some of the operational challenges, as opposed to the usual defensiveness that exists in many organizations, which results in the finger-pointing that oftentimes unravels these kinds of relationships," Jain said.
Beyond the particulars of Costco as a partner, the new launch also reflects SCAN's push to be more than just a Medicare Advantage company. The team has put a focus of late in emphasizing its unique perspective and approach to Medicare, and aims to bring that same view to supplemental coverage options.
For instance, a year ago, SCAN declared that "healthcare is broken" and acknowledged some of the challenges that members face in their day-to-day experiences with the system. Acknowledging the cracks in healthcare's foundation is a rarity for a health plan.
Jain said that given the buying power that insurers have, they "should be able to make miracles happen for people, as opposed to drowning them in denials and paperwork." Care coordination and other services that have worked in Medicare Advantage could support a better experience in Medicare supplement if adapted effectively.
"I think more than anything, what people need today from their health plans is for us to be advocates for you, as opposed to obstacles to you," he said.