Economy

Amazon Launches Low-Cost Prime Membership For Medicaid Recipients

Amazon Launches Low-Cost Prime Membership For Medicaid Recipients

The online retail giant said Wednesday that it will extend its $5.99 monthly Prime membership to the roughly 20% of the USA population that is signed up for Medicaid.

Prime is just $5.99/month for qualifying customers with an EBT or Medicaid card.

Prime costs $99 annually, or $12.99 on a monthly basis.

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Medicaid is the government program that helps provide health coverage for many low-income families and disabled individuals.

Prime gives customers free two-day shipping and other perks like free video streaming and access to the Prime Now two-hour delivery service. More than 42 million participate in the food stamps program, through what is now called the Supplemental Nutrition Assistance Program.

"We know a discounted Prime plan is not the solution to every problem customers face", said Aaron Perrine, general manager of Lifestage Programs at Amazon, "but we believe it's one piece of the puzzle in making their lives a little bit easier".

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Targeting low-income customers is a key part of the war between Amazon and Walmart. While Amazon doesn't say how many members Prime has, those customers usually spend more and buy more frequently than non-members. Amazon also a year ago began a program to deliver groceries to food-stamp recipients. Morgan Stanley reported in December that growth in Amazon Prime memberships is also flattening out with the percentage of Americans who have Prime holding steady at about 40% between the end of 2016 and the third quarter of 2017.

In that regard, offering a social benefit for people who may have more challenges getting to a store or affording faster shipping could become sound business, too, said Avi Greengart, an analyst at Global Data. The new offer is valid for up to four years, Amazon told Reuters. There is no annual commitment and customers can cancel the membership at any time. The Prime promo price is only available to adult Medicaid cardholders. If you receive Medicaid benefits, you can now get Prime at a discounted rate as well.

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