The Hidden Costs of In-House Medical Delivery Programs

Why In-House Medical Delivery Looks Affordable — but Isn't

If you only count driver wages and fleet costs, in-house medical delivery can look inexpensive. But in healthcare, the true cost of pharmacy delivery extends far beyond payroll. Exception handling, rework, compliance gaps, and invisible operational drag are all part of the total cost per delivery — and they're rarely labeled as "delivery costs."

Instead, these hidden costs get buried across disconnected budget lines: admin overhead, inventory shrinkage, pharmacy loss, compliance budgets, clinical rework, and patient service. Leadership can't see the bleed because delivery spend is distorted by cost coding and scattered across systems. Redeliveries often go untracked. Write-offs get treated as inventory shrinkage. Staff time chasing exceptions gets coded as admin overhead. And the cost of non-compliance events and poor patient experiences shows up in management labor — never attributed back to the healthcare delivery operation that caused them.

What Most Leaders Count — and Why It's Only 30–40% of Real Medical Delivery Costs

At a glance, in-house delivery programs incur what we'd call accounting costs — the expenses that show up on a budget line somewhere:

Driver salaries and overtime. Overtime can spike total driver payroll when delivery volumes fluctuate — a common problem in pharmacy delivery programs without capacity controls.

Fleet ownership or leasing. Depreciation, licenses, parking, and storage add up, particularly when vehicles sit idle during low-volume periods.

Fuel, maintenance, and insurance. Even conservative estimates typically understate the wear-and-tear costs of running a healthcare delivery fleet.

Devices, uniforms, and equipment. Scanner costs, tablets, PPE, and temperature-monitoring devices for specimen transport and pharmaceutical delivery.

These are the visible costs most healthcare organizations already track. But they represent only 30–40% of the true cost per delivery. The rest hides in plain sight.

The Hidden Costs of Employee Drivers in Healthcare Delivery

Failed Pharmacy Deliveries, Undeliverables, and Rework

Failed pharmacy deliveries are one of the biggest hidden cost drivers in healthcare logistics. When patients aren't home, pickups are missed, or parcels are marked "undeliverable," the costs cascade: lost driver time, rescheduling labor, patient frustration, compromised temperature control for medications and specimens, and follow-up work that is rarely tracked but always unavoidable.

Every re-attempted delivery doubles the cost of that stop — and in most in-house programs, re-attempt rates aren't even measured.

Driver Turnover, Recruiting, and Onboarding

Employee driver turnover is a persistent challenge in healthcare delivery operations. Each departure creates a sudden coverage gap, and each new hire requires recruiting time, orientation, shadowing, and supervision — all of which divert leadership and HR resources away from core healthcare priorities. The cost of replacing a single driver often exceeds $5,000 when recruiting, training, and productivity loss are factored in.

Leave Burden and Benefits

In-house medical delivery programs carry the full cost of sick time, FMLA, disability, workers' compensation, and benefits beyond wages. When absences hit, they're covered through overtime, reassignment, or last-minute routing changes — increasing both cost per delivery and operational variability.

Dispatch and Manual Coordination

Many healthcare organizations still rely on manual dispatch for their delivery operations — phone calls, spreadsheets, and whiteboards. Every minute spent manually routing a driver or rescheduling a failed drop-off is a minute stolen from patient care or clinical coordination. Without route optimization technology, healthcare last mile delivery becomes labor-intensive and error-prone.

Oversight and Management Overhead

Route oversight, performance reviews, compliance audits, and disciplinary actions are ongoing operational demands that consume management bandwidth. In an in-house delivery model, all of this falls on your team — and it rarely gets attributed to the cost of delivery.

Lost Clinical Productivity

When clinicians, pharmacists, or administrative staff have to chase delivery status, call drivers, or absorb logistics disruptions, the opportunity cost is measured in delayed care, administrative burnout, and reduced throughput. This is one of the most damaging — and most invisible — hidden costs of in-house medical delivery.

"The undeliverable problem is largely avoidable. With a simple, systemized patient notification process that clearly communicates delivery windows, undeliverable packages can be dramatically reduced. At GO2 Delivery, we have cut undeliverable packages by 80% by improving the delivery process itself instead of adding more drivers."

— Eric Brown, Founder and CEO, GO2 Delivery

Why Most In-House Healthcare Delivery Programs Can't Measure Performance

In-house medical courier operations often lack the basic performance controls needed to understand what's actually happening in the field. Most hospitals and pharmacies don't have reliable mechanisms to measure how long deliveries truly take, where time is being lost, how efficient routes are, or how consistently drivers follow required procedures.

Without standardized KPIs — on-time delivery rate, route efficiency, stops per hour, proof of delivery, and regulatory compliance — leadership manages delivery by assumption rather than evidence.

The result is a largely manual operation with limited visibility and almost no real field auditing. Driver activity isn't consistently reviewed, documentation is incomplete, and compliance standards such as HIPAA and PHI handling are not systematically enforced. These gaps allow inefficiency and risk to persist unnoticed — even as healthcare delivery costs quietly continue to rise.

The Key Metric Driving Hidden Costs: Deliveries Per Hour

Deliveries per hour is the single most important metric in healthcare logistics — and the main multiplier behind overtime, burnout, and rising cost per delivery.

In efficient medical delivery operations, each successful delivery should take 0.3–0.4 hours. However, in real-world in-house pharmacy delivery programs, we routinely see 0.75–1.65 hours per delivery.

That gap triggers a cascade of cost escalation: overtime explosions, coverage failures during peak demand, driver burnout and turnover, rising cost per successful delivery, shrinking operating margins, and lack of delivery density due to improper routing.

One client generated $4,000 in overtime from a single driver in a single pay period because the system lacked capacity controls. These are the kinds of costs that make in-house medical delivery far more expensive than most organizations realize.

How to Calculate the True Cost Per Delivery in Healthcare

If you want a clean, defensible comparison between employee drivers and a medical courier service partner, you need to calculate the true cost per successful delivery — not cost per attempt, but cost per delivery that actually reaches the patient, on time, intact, and documented.

The 3-Bucket Delivery Cost Model

To expose the accurate cost of in-house medical delivery, break expenses into three categories:

Bucket A — Visible Costs: Wages, fleet, fuel, insurance, and equipment. These are the numbers most teams already track — but they represent only part of the picture.

Bucket B — Variability Costs: Overtime, driver turnover, recruiting, training, leave, and coverage gaps. These fluctuate with volume and staffing and are harder to attribute directly to delivery.

Bucket C — Failure Costs: Rework, specimen redraws, wasted product, compliance events, delays, lost revenue, and reputational damage. These almost never appear on a delivery budget line — but they're often the largest cost bucket.

The Formula

True Cost per Successful Delivery = (Bucket A + Bucket B + Bucket C) ÷ Total Successful Deliveries

When we analyze in-house employee driver programs for healthcare organizations, the same medical courier service cost multipliers show up consistently:

• Low delivery stops per hour
• Geography expanding faster than routing capacity
• Higher re-attempt rates and missed pickups
• Over-servicing the same patients with more runs than necessary
• No system for selecting the right delivery method per run
• Limited routing and dispatch tools to consistently meet deadlines

In-House Medical Delivery vs. Outsourcing: What the Numbers Reveal

Once healthcare organizations calculate their true cost per successful delivery using this framework, the comparison between in-house delivery and healthcare delivery outsourcing becomes much clearer. What looked like a cost-saving decision often turns out to be a margin-eroding one — buried under invisible rework, overtime, and compliance exposure.

The fastest path to better decisions is to calculate your actual cost per successful delivery and compare it against scalable, purpose-built alternatives from a specialized medical courier service.

Get Your True Cost Per Delivery — Free

If you'd rather not build this analysis from scratch, GO2 Delivery can calculate your real cost per successful delivery and show you exactly where the spend is leaking — so you can make the in-house vs. outsource decision with data instead of assumptions.

We've done this for hospitals, pharmacies, and laboratory networks across the country. Request a free delivery cost analysis →

Related Reading:

• Part 1: Why Medical Delivery Is More Complex Than Most Healthcare Organizations Realize
• Part 3: Why In-House Driver Programs Break Down at Scale
• Part 4: Compliance, Risk & Insurance — What Healthcare Teams Underestimate
• Part 5: When to Outsource Healthcare Delivery (and What to Look For)