Amazon Slashes Prime Fees for Medicaid Enrollees in Play for Low-Income Customers

03-08 00:25
Photo: Mark Lennihan (AP)

Today, Amazon extended its Prime membership program at a steep discount—$5.99 per month compared to the standard $12.99—to customers enrolled in Medicaid, as it began doing in June for those using Electronic Benefits Transfer cards (used to disperse government food and cash benefits.)

Free two-day shipping and the other various perks of Prime remain identical for those applying with a Medicaid or EBT card, with the 54 percent reduction in membership serving to entice lower-income shoppers whose dollars Amazon struggles to capture . (Middle- and higher-income consumers, however, had their monthly Prime costsraised slightly in January.)

Pursuing Medicaid enrollees further heats up the ongoing war between Amazon and one of its biggest competitors: Walmart. While neither company provides robust data on their shoppers, industry analysis suggests the average Walmart shopper earns less than the average Prime member. Check-cashing and other services associated with the unbanked also traditionally fall within the purview of Walmart. Earlier this week, Amazon was reported to be in talks with big banks about launching a “checking-account-like product” to siphon that demographic away from its rival.

Amazon Go, its expanding network of cashierless convenience stores, still do not accept food stamps (something an estimated 10 percent of its employees in Ohio are enrolled in )—citing “current laws” as the key roadblock. One imagines the company is already lobbying for a change in legislation.

In the meantime, continues to participate in a pilot program alongside six other online retailers to accept the federal Supplemental Nutrition Assistance Program.

[ NYT ]

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