Pharmacy deserts appear across U.S. as pharmacy closures spread | Wilnesh News

New Lebanon, Ohio, has a population of 3,756 and is home to three dollar stores, a Groceryland grocery store, several fast food restaurants, a public library branch, and a vibrant school system. It doesn’t have a pharmacy.

As part of Rite Aid’s bankruptcy filing in October 2023, the chain announced it would close 800 stores, with Ohio being hit particularly hard, with the 180 stores shuttered mostly in struggling small towns or Rust Belt cities. According to the Rite Aid website, the chain currently has 1,700 stores, down from the 2,111 reported at the time of the bankruptcy. The company said it will emerge from bankruptcy with about 1,300 stores.

The Rite Aid in New Lebanon closed in September.

“My community needs a pharmacist. It worries me that the residents here don’t have a pharmacist,” said Lebanon’s new mayor, David Nickerson.

Some of the smaller towns near New Lebanon have their own pharmacies, but even these are a 15-minute drive away. Rite Aid prescriptions in New Lebanon have been transferred to walgreens 30 minutes drive from Dayton.

Nickerson, who was elected last year and has a military background, recently found himself walking in a Walgreens parking lot in Dayton. He even strolled behind the building at night to conduct thorough inspections, telling his constituents he had done his due diligence and made sure it was a safe place. But for some New Lebanon residents, even leaving a Walgreens safe and clean isn’t enough.

“We have a lot of older residents who are uncomfortable with the traffic and the unknown areas,” Nickerson said.

In New Lebanon, which sits on a busy thoroughfare leading into Dayton, getting medication isn’t always difficult.

“Before we moved to New Lebanon two years ago, there were three pharmacies there,” Joyce Dingman said. “The CVS in New Lebanon closed last year, and now Rite Aid is closed, and we have nothing.”

She and her husband will travel to a town 30 minutes away to fill their prescriptions at a Kroger pharmacy.

A Rite Aid spokesperson confirmed the shutdown’s dramatic impact on Ohio.

“Nearly all of our stores in Ohio will close by the end of September as part of our recent Chapter 11 process to create a stronger, healthier company,” the spokesman said, adding that Ohio There will be only four Rite Aids left. Before the latest round of closures, there were more than 140.

New Lebanon isn’t the only place struggling to keep its dispensary, though. Experts say the retail pharmacy model is being squeezed by complex and sometimes low drug reimbursement rates, while competition has become fiercer for sales of items used to boost profits, such as candy and paper towels.

pharmacy squeeze

As the federal government sues middlemen in the primary drug market, with pharmacy benefit managers — and the Federal Trade Commission alleging inflated prices for drugs like insulin — some are pointing the finger at PBMs that are deserting pharmacies.

Miranda Rochol, senior vice president of provider solutions at health technology company Prescryptive Health, has worked her way through the industry, starting out as a pharmacy before joining the health technology team at Walgreens technician. “PBMs can direct patients to their own pharmacies, bring profits to their pharmacies, and reduce costs for community pharmacies,” she said.

June, FTC releases scathing report on PBMs and Decades of mergers and acquisitions have put a squeeze on high-street pharmacies. According to the FTC, three major PBMs control nearly 80% of prescription drugs in the United States and negotiate the terms and conditions for hundreds of millions of Americans to obtain prescription drugs. The report attributes many of the financial woes of small pharmacies to declining pharmacy benefit management reimbursement rates.

“As long as the big three PBMs don’t get control, more pharmacy deserts will appear,” Rockall said.

The three largest PBMs are CVSCaremark, OptumRX (part of UnitedHealth) and Express Scripts, owner Cigna.

A spokesman for Express Scripts noted that the company filed an FTC lawsuit over the report, calling it unfair, prejudicial, false and defamatory, claiming the report “erroneously concluded that PBMs drive up drug costs and harm independent pharmacies.” in conclusion”.

Walgreens Boots Alliance CEO Tim Wentworth, who served as CEO of Express Scripts from 2016 to 2021, spoke on the PBM during Walgreens’ third-quarter earnings call, said the company is “in active discussions with our PBMs and payment partners to align incentives and ensure we pay fairly.”

Walgreens announced, Up to 25% of its 8,200 stores may be closed. This will further squeeze communities that lack dispensaries. A Walgreens spokesperson noted that while they may be large, they are still “independent” — not affiliated with a PBM — so they face many of the same price pressures as smaller stores.

CVS has also closed stores, and a CVS Caremark spokesman disputed the idea that it was financially squeezing small pharmacies, pointing to Georgia as an example. Between 2023 and 2024, reimbursements at independent pharmacies in the CVS Caremark Pharmacy network will be 67.5% higher on average than at CVS Pharmacy locations and 51.9% higher than at other chain pharmacies in the state.

“Local independent pharmacies are important partners in the CVS Caremark pharmacy network, accounting for more than 40 percent of the pharmacies in our network,” the spokesperson said. “Overall, CVS Caremark reimburses independent pharmacies far more than chain pharmacies.” bureau.”

A CVS spokesperson also said that not all CVS pharmacies are served by Caremark, but that it works with more than 70 different PBMs. A spokesman said none of the CVS closures were related to PBM issues but were due to changes in consumer buying patterns and demographic changes.

“Claims that PBMs underreimburse independent pharmacies are not true. In fact, studies show that PBMs reimburse independent pharmacies more than chain pharmacies,” said Greg Lopez, spokesman for the National Association of Trade Pharmacy Regulators. Greg Lopes said. “Unfortunately, there are a number of factors leading to the closure of pharmacies in rural areas, including population decline and the increasing use of online pharmacies.”

Data from the National Association of Community Pharmacists illustrates concerns about PBM pricing.

Nearly all pharmacies (99%) experienced reductions in point-of-sale prescription drug reimbursements. More than half said insurance plans and their PBMs reimburse pharmacies less than the cost of purchasing the drugs for at least 3 out of 10 prescriptions they fill.

The National Association of Chain Pharmacies is urging PBMs to reform the legislation. “The U.S. Congress has done hard work to prepare for bipartisan pharmacy benefit manager (PBM) reform in the 118th term,” said Steven C. Anderson, president and CEO of NACDS. ‘Legislation that must be passed’ before Parliament adjourns.

CVS withdrew from NACDS in 2022 amid NACDS’ support for PBM reform.

The vital role of local pharmacists in the age of Amazon

Experts say PBMs are just one of many reasons why retail pharmacies are in trouble.

As neighborhood pharmacies close, patients are having to get even more creative when getting their medications. Dr. Colin Banas, chief medical officer of healthcare solutions company DrFirst, said if a nearby pharmacy is closed, there are a number of other ways for patients to get their medications.

“For emergency medications, if patients are unable to drive to an available pharmacy, they can explore prescription pickup and delivery services offered by ride-sharing services like Uber and Lyft,” Banas said.

He added that it was also worth checking with local hospitals to see if they had an in-house pharmacy that could issue prescriptions. “Even some doctors’ offices and urgent care centers stock certain medications, so it’s worth making a few calls,” Banas said.

But Banas believes pharmacy deserts will only get bigger, leading to an increase in the number of apps and digitization.

“As pharmacy deserts become more common, patients should look to new apps and digital tools that will increasingly begin to fill some of the gaps,” Banas said.

This week, Amazon announced that it will expand same-day prescription drug delivery to about half of the United States next year.

Patient advocates say technology cannot replace humanity.

Dr. Tamera Hughes, assistant professor at High Point University School of Pharmacy, said all the focus on PBMs, reimbursement and profits ignores the human side of the industry.

Hughes said the PBM business model does favor getting people more receptive to medications through the mail, but any potential short-term savings come at the expense of the value of the pharmacist-patient relationship.

“Medication delivery robs pharmacists of the engagement and rapport they build within the communities they serve,” Hughes said.

While working at the pharmacy, she got to know her regular customers, their needs and illnesses. “I know all my clients by name; I ask about their vacations and their grandchildren. By removing that one-on-one upfront engagement with the community they serve, you take away the point of taking a holistic view of other people’s health,” Hughes said. “Pharmacists are not just responsible for dispensing prescriptions, but are responsible for a number of other lifestyle things that lead to healthy individuals, and pharmacies have historically done a good job of that.”

In fact, Hughes said pharmacists often serve as de facto doctors for those who can’t afford to see a doctor.

“People would come to the pharmacy counter and pick up their prescriptions, and two or three other people would come to the pharmacy because their kids were sick and say to the pharmacist, ‘What do you recommend for a sore throat or a cough?’ … I get that at least five times an hour. Going from behind the counter to helping someone pick a medication for their child, we can ask questions to get them the best over-the-counter medication,” Hughes said.

Pharmacies are being squeezed from all sides — due to rising PBMS costs, competition from online pharmacies like Amazon and retail rivals like dollar stores — but Hughes said by serving as the first line of defense against disease, community pharmacy Divisions can reduce pressure on the larger health system. That line of defense is disappearing as drugstore chains like Rite-Aid close hundreds of retail stores.

A Rite Aid spokesman said the closure was an effort to create a “more efficient company.”

In New Lebanon, city officials and the mayor just want their pharmacy back. Acting Village Manager Rob Anderson said it’s a real inconvenience for some residents and the closure of Rite Aid is a blow to the town.

“Rite Aid leaving makes your town look like it’s on a negative path, when in reality New Lebanon is doing pretty well,” Anderson said. “But it makes you feel like big companies don’t take it as seriously as they once did. your town.”