It is becoming increasingly difficult not to think of Rite Aid as one of the chain drug industry’s trendsetters. Truth is, America’s third-largest drug chain is unveiling innovative programs, bold initiatives and dramatic new directions at a furious pace, outdistancing its two larger rivals in terms of creativity, significance and drama.


Rite Aid, David Pinto, chain drug industry, drug chain, Hoboken, drug stores, Kathleen Sebelius, secretary of Health and Human Services, Senator Robert Menendez, Affordable Care Act, John Standley, Health Insurance Marketplace, wellness+ program, Walgreens, CVS


































































































































































































































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Inside This Issue - Opinion

Rite Aid climbs back into the industry elite

September 30th, 2013
by David Pinto

It is becoming increasingly difficult not to think of Rite Aid as one of the chain drug industry’s trendsetters. Truth is, America’s third-largest drug chain is unveiling innovative programs, bold initiatives and dramatic new directions at a furious pace, outdistancing its two larger rivals in terms of creativity, significance and drama.

Most recently, earlier this month to be precise, Rite Aid convened a press event in one of its Hoboken, N.J., drug stores to announce that, come next month, it will staff nearly 2,000 of its drug stores with independent, licensed insurance agents trained to advise customers and help them evaluate their various health care plan options — going so far as to assist customers in enrolling in a plan, should they choose to do so.

On hand for the press event were Kathleen Sebelius, the secretary of Health and Human Services, and Senator Robert Menendez (D., N.J.), as well as several local and regional officials. Sebelius was particularly eloquent on the eve of the October 1 start of open enrollment for the Affordable Care Act, reminding her audience that “families look to their pharmacies as a place they can trust” while commending Rite Aid for its willingness to take the initiative in encouraging its customers to participate at the start of the Health Insurance Marketplace open-enrollment period.

On hand as well were several senior Rite Aid executives, including chief executive officer John Standley, who noted that “with the implementation of the Health Insurance Marketplace, our customers will have many new decisions to make in the coming enrollment period. We know they will look to Rite Aid for information and guidance, and that’s why we’re providing free resources, in-store and online, to help them better understand the new requirements and options available to them under the law.”

The independent, licensed agents Rite Aid will make available, at no charge, have received targeted training to assist Rite Aid customers in navigating the Affordable Care Act terrain. These agents will be available to customers without an appointment. Indeed, Rite Aid has gone so far as to provide a phone number customers can use to find the closest store with an agent.

This service is but the most recent example of Rite Aid’s increasing ability and willingness to reach out to customers in an effort to educate, rather than sell them, on health care. Indeed, the retailer’s wellness+ program, currently being rolled out across the drug chain, has been amply and aptly praised for offering valuable advice about consumer health and providing pharmacists and other in-store personnel to support and elaborate on that advice.

Perhaps what’s most remarkable in all this is that these programs and services come from a retailer that is only now recovering from a prolonged downturn in its fortunes, a downturn precipitated by several strategic moves that some observers have derided as ­ill-considered or ill-executed.

In their aftermath, Rite Aid has found itself burdened with many small, old or outdated stores in tertiary markets perhaps more-effectively served by local drug chains. This burden was best exhibited in financial results that lagged both Walgreens and CVS, sometimes ­seriously.

Now, those burdensome days seem behind this 4,600-store, 31-state drug chain. Sales increases have become routine, and the retailer now turns a profit on a quarterly basis. Perhaps more significant, Standley has led a senior-management upheaval that now claims highly capable executives in critical positions throughout the chain.

The just-announced Affordable Care Act initiative is the logical outcome of all that has preceded it during Stanley’s tenure as CEO. More to the point, it is not an end but a beginning for Rite Aid. For surely, more such initiatives will follow in the period ahead, as the Camp Hill, Pa.-based drug chain continues to climb back into the very first ranks of drug store retailing in America.

In other words, it’s becoming increasingly difficult to dismiss Rite Aid as just another drug chain.

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