USPS warning raises stakes for mail-order prescriptions, higher postage prices

The U.S. Postal Service is staring down a cash crunch within a year — just as its biggest customer, Amazon, prepares to sharply scale back deliveries. Why it matters: Even as major retailers build their own logistics networks, millions of Americans — especially in rural areas — still rely on USPS for essentials like prescription medications and last-mile delivery.

Driving the news: Postmaster General David Steiner warned lawmakers this week that USPS could run out of cash in less than 12 months without congressional action.

"The mail will stop" if the agency can't meet its obligations, he said. That includes critical deliveries like "prescription drug packages."

At the same time, Amazon plans to cut the volume it sends through USPS by as much as two-thirds by September.

Amazon said Wednesday that USPS "abruptly walked away at the eleventh hour" after more than a year of negotiations, derailing a potential long-term deal.

State of play: The financial warning from USPS is colliding with a growing fight over how the government-run, self-funded postal service should fix its finances.

USPS is pushing to raise stamp prices to as high as 90-95 cents — up from 78 cents today Lawmakers say tradeoffs are inevitable, including potential service cuts or higher prices.

What they're saying: A coalition of mailers, led by Keep US Posted, argues USPS is "raising prices while reducing service" and penalizing its core mail business — warning the current strategy could push the agency toward a taxpayer bailout.

Government watchdogs warn there are "no easy solutions," and that USPS likely can't fix its finances without congressional action.

Between the lines: The Postal Service's financial crisis isn't just cyclical — it's structural.

USPS has lost money every year since 2007 as traditional mail volumes collapsed. It still must deliver to roughly 170 million addresses nationwide, regardless of cost.

Threat level: Mail delivery is a critical — and often overlooked — part of the U.S. health system.

Delivery slowdowns can leave patients with chronic illnesses without needed medications, especially in rural areas. About 6% of diabetes prescriptions in the U.S. are delivered by mail, according to Brookings research. Roughly 3.7 million Medicare enrollees live in areas where pharmacy access is limited and reliance on mail delivery is high.

What we're watching: Lawmakers agree USPS can't fail — but are split on how to fix it. Options on the table:

Raise prices Cut delivery days or close post offices Increase federal support or borrowing authority

Steiner's bottom line: If Americans want current service levels, "someone has to pay for it."

Even USPS leadership acknowledges cost-cutting alone won't solve the problem — meaning higher prices, reduced service or public funding are likely unavoidable.

Yes, but: The cost-cutting options under discussion would hit hardest in the same places that depend most on USPS, including those who rely on mail-order medications. More from Axios:

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