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August 28, 2016
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Test Strip Crimes - Who ELSE Pays the Price?

One of the biggest issues in retail store management is "shrinkage" or "loss prevention" — the loss of product to damage and theft, and the loss of revenues due to products returned in unsellable condition or outside of their sales season. While we've tended to think of shoplifting as a onesie-twosie operation, there's been a growing uptick in systemized, organized retail theft. Stores magazine calls this "Organized Retail Crime (ORC)", the proceeds of which may be used to fund "human trafficking, drugs, and terrorism"1.

Normally, retail crime touches most of us as a lack of product availability, or increased product prices. Since the Internet and various online sales channels have made it easy for organized groups to steal large quantities of items from predetermined "shopping lists" and sell them online, most of us don't perceive anything other than the increased ease and price-friendliness of online versus in-store purchases (and the shrinking number of retail stores and sales associates). As ORC consultant Gus Downing says in a sidebar, "Honest people are buying stolen merchandise... All they've got to do is turn on their computer and buy it off Craigslist."2

Another sidebar, "Major Crimes", lists a March 2014 theft of over $15 million in products "from Walgreens, CVS and Publix" in South Florida, "targeting diabetes test strips, painkillers, and heartburn medication". The operation included several "mid-level 'fences'" and was referred to by Miami-Dade State Attorney Katherine Fernandez Rundle as a "massive criminal enterprise".3 While the article had me rapt until that point, the phrase diabetes test strips hit me like a punch in the gut.

I've mentioned previously that I usually buy my test strips from dealers on A few things strike me as odd, though. Many big volume dealers will have several listings for the same item — often at different price points — and with different "quantities available". You'd think that if we were talking about one dealer, all of their stock for a given item should be listed under a single heading and a single price point. Also, I seem to recall my last couple of shipments from the same dealer being shipped from different locations, and I think one of them even had a private name somewhere in there.

Given the availability of product from these dealers, I'm now worried about how much of it is reselling excess/unused product, how much is trading strips for rent money, and how much of it might be related to "organized retail crime". As anyone who's watched a "cop show" can tell you, purchasing goods you know have been stolen is a crime.

While it's obvious that the stores lose product revenue, prices rise to cover the losses, and individual patients may have to wait a few days for a replacement shipment of medications, I have to wonder who else pays for this sort of organized crime. But given the exorbitant price of medications and healthcare supplies and the refusal to cover "non-preferred" brands, even at the highest co-pay level, I can't see demand dropping enough to lower retail prices to the point that they are competitive with current online suppliers (or with preferred-brand co-pays).

Right now, I'm just seeing this ethical dilemma as one more obstacle placed between me and my diabetes management.

Which is a totally different sort of crime.

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