• Posted December 4, 2024

Almost a Third of U.S. Retail Pharmacies Have Closed Since 2010

About a third of America’s pharmacies have closed since 2010, amounting to an “unprecedented decline” in neighborhood drug stores, a new study finds.

The drop began in 2018, primarily driven by store closures among chain pharmacies during a period of consolidation in the industry, researchers found.

This has made it much more difficult for people to have prescriptions filled, get vaccinated and obtain many other essential health services, researchers report.

“At the same time many states are making efforts to expand the scope of pharmacy services beyond dispensing drugs to include the provision of preventive and emergency care, we found that there are -- for the first time for at least a decade -- fewer pharmacies available to provide them,” said senior researcher Dima Mazen Qato, a senior scholar at the University of Southern California (USC) Schaeffer Center for Health Policy & Economics.

For the study, researchers tracked pharmacy closures that had occurred between 2010 and 2021.

For most of the 2010s, pharmacy openings in the United States outpaced drug store closures. Only about 1 in 8 pharmacies shuttered between 2009 and 2015.

But starting in 2018, large pharmacy chains began to merge -- and shut down stores deemed not profitable enough.

These mergers not only caused a reduction in chain pharmacies, but also accelerated the closure of independent neighborhood pharmacies, researchers found.

Independent pharmacies were more than twice as likely as chain pharmacies to close, edged out by the chains’ powerful pharmacy benefit managers, researchers said.

“A key factor contributing to the higher risk of closure for independent pharmacies may be their frequent exclusion from preferred pharmacy networks,” said lead researcher Jenny Guadamuz, an assistant professor at the University of California, Berkeley School of Public Health.

These benefit managers use bare-knuckles tactics to encourage patients to visit chain pharmacies rather than mom-and-pop operations, researchers said. People can fill prescriptions with less cost-sharing and out-of-pocket costs at chain pharmacies, while independent pharmacies are offered lower reimbursements.

Between 2019 and 2021, the number of drug stores declined in 41 of 50 states, researchers found.

Nearly one-third of counties experienced a decline in pharmacies, affecting nearly 92 million people.

Closures hit seven states hardest -- Illinois, Maine, Mississippi, New York, Pennsylvania, Rhode Island and Vermont. There, more than half of counties experienced a net decline in pharmacies.

Black, Latino and low-income neighborhoods in particular have lost pharmacies, as well as locales with more people covered by Medicare or Medicaid, researchers found.

Pharmacy closure rates were 38% in Black neighborhoods and 36% in Latino neighborhoods, compared with 28% in white neighborhoods.

The study was published Dec. 3 in the journal Health Affairs.

“Our findings suggest that closures may widen health disparities in access to prescription and other essential pharmacy services, such as vaccinations and pharmacist-prescribed regimens, including contraceptives, medications for HIV prevention, and treatments for opioid use disorder," Guadamuz said.

"Without safeguarding pharmacies in marginalized neighborhoods, expanding health care services at pharmacies may enhance convenience for more affluent populations while failing to address the health needs of communities disproportionately affected by pharmacy closures, particularly Black and Brown populations in low-income urban areas," Guadamuz added.

Regulators and policymakers could help maintain access to pharmacies by enacting measures that make sure independent pharmacies are included in preferred benefit networks, the researchers said.

“Federal, state and local policies and programs should consider targeted strategies, including increases in Medicare Part D and Medicaid pharmacy reimbursement rates, to protect critical access pharmacies most at-risk for closure, particularly those serving neighborhoods that are or are at risk of becoming pharmacy deserts,” Qato said in a USC news release.

More information

Boston University has more on pharmacy closures.

SOURCE: University of Southern California, news release, Dec. 3, 2024