Dive Brief:
- Kroger, the network of grocery stores, has announced its third Medicare Advantage plan offering in partnership with a health insurer.
- Kroger’s new MA plans with Select Health, the insurance subsidiary of nonprofit hospital operator Intermountain Health, are meant to focus on health and wellness by providing customer savings on groceries and prescription medications at Kroger stores and pharmacies, according to the Tuesday press release.
- The plans, which are targeted at Medicare-eligible Kroger shoppers, will be offered in select counties in Colorado, Idaho, Nevada and Utah for the 2024 plan year.
Dive Insight:
Like other major retailers, including CVS, Walgreens and Walmart, Kroger has been moving more into care management and delivery, looking to leverage its extensive network of groceries, pharmacies and retail clinics to connect with patients in the ongoing shift to community and home healthcare.
Kroger took its first step into MA plans in 2021, when the Cincinnati-based grocery chain partnered with Anthem Blue Cross Blue Shield (which has since rebranded to Elevance Health) on co-branded MA plans in Ohio, Kentucky, Georgia and Virginia.
Last year, Kroger announced its second co-branded MA plan with Priority Health in select counties in Michigan.
Select is a nonprofit plan that currently covers more than one million members in Utah, Idaho and Nevada. The Intermountain subsidiary was interested in partnering with Kroger because many Medicare beneficiaries shop and fill prescriptions at its stores, Jason Worthen, Select Health vice president of government markets, said in a statement.
Enrollment has steadily climbed in Medicare Advantage plans, where private health insurers contract with the government to cover the care of Medicare seniors.
The plans, which can offer nontraditional benefits such as nutrition services, in 2023 grew to cover more than half of all Medicare beneficiaries, despite concerns over skyrocketing federal spending on MA.
Health insurers have inked agreements with retailers to offer members access to a lower-cost site of care and differentiate their offerings in the crowded MA market. Walmart, for example, offered a joint MA plan with Clover Health in Georgia in 2021.
Kroger has been expanding its offerings in healthcare, even creating a sector-specific division, called Kroger Health.
Kroger Health includes 2,200 retail pharmacies in 35 states and a medical clinic network of almost 230 locations in nine states, along with a specialty pharmacy and infusion service.
In January, the healthcare division launched a clinical trial site network to find and enroll patients in clinical trials, and help research organizations, pharmaceutical companies and health systems conduct select trials.
Kroger Health delivered positive sales growth in Kroger’s first quarter results released in June, despite the effects of a contract dispute with pharmacy benefit manager Express Scripts. Kroger decided to take its pharmacies out of network with the Cigna subsidiary last year, after determining it would be filling prescriptions below cost under Express Scripts’ contract proposal.
In December, Kroger said the contract termination would reduce sales by about $100 million in the one month that remained of its fiscal fourth quarter.
Kroger did not respond to a request for comment on its healthcare business strategy.
