Millions of older Americans may soon be able to shop for Medicare coverage through Costco, as the retailer is preparing to enter the Medicare insurance market through a partnership with insurer SCAN Group. Costco plans a limited rollout of jointly branded Medicare Advantage plans in two states and a Medicare supplement plan in a third, pending approval from federal Medicare regulators, the company announced this week. The three markets together include about 5 million Medicare enrollees, though the locations have not yet been released.
Medicare coverage decisions affect tens of millions of Americans. Medicare beneficiaries often have to decide between Original Medicare, Medicare Advantage, Part D prescription drug plans and Medicare Supplement Insurance, which is also known as Medigap. As of April, 70.3 million people were enrolled in Medicare.
CMS said 51.2 percent were enrolled in Medicare Advantage and other health plans, while 81.2 percent had Medicare Part D coverage. Costco is working with SCAN Group on a limited pilot that would sell Costco-branded Medicare products. SCAN Group is based in Long Beach, California, and has about 560,000 members while offering Medicare Advantage plans in Arizona, Nevada, New Mexico, Texas and Washington state.
The new products are expected to be sold through Costco stores, insurance agents and websites. The plans will not include a Costco membership because federal rules prohibit that type of arrangement. Source: CMS April 2026 enrollment data and KFF 2026 Medicare Advantage analysis.
The Costco-SCAN partnership would not replace federal Medicare. Instead, it would offer private Medicare coverage options to eligible beneficiaries. Based on the reported rollout, Costco’s Medicare products would likely fall into two broad categories: Medicare Advantage plans generally bundle Part A and Part B and usually include Part D prescription drug coverage.
These plans may require members to use doctors and hospitals in the plan’s network and can require approval for certain drugs or services. Original Medicare, by contrast, allows beneficiaries to use any doctor or hospital that takes Medicare anywhere in the U.S., and beneficiaries can add a separate Part D plan and supplemental coverage such as Medigap. Eligibility would depend on the final plan design, the approved service area and the type of plan offered.
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