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30% Of U.S. Retail Pharmacies Gone In A Decade

Jason Phillippe by Jason Phillippe
December 6, 2024
in Health News
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30% Of U.S. Retail Pharmacies Gone In A Decade

Photo by Dima Mukhin on Unsplash

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This is an unprecedented decline.

A recent study reveals that nearly a third of U.S. pharmacies have closed since 2010, marking an “unprecedented decline” in local drugstores. This trend, which began in 2018, has primarily been driven by store closures among chain pharmacies amid an industry-wide consolidation period. As a result, people have faced increased difficulty in filling prescriptions, accessing vaccinations, and receiving other essential health services.

Dima Mazen Qato, senior researcher at the University of Southern California’s Schaeffer Center for Health Policy & Economics, highlighted that while many states are working to expand pharmacy services, the number of available pharmacies has dropped to its lowest point in at least a decade. Researchers tracked pharmacy closures from 2010 to 2021, noting that closures had been rare earlier in the decade, with openings exceeding closures between 2009 and 2015. However, by 2018, mergers among large chains led to the closure of underperforming stores, which also contributed to the decline of independent pharmacies.

Independent pharmacies, which were already at a disadvantage, faced a significantly higher rate of closures than chain pharmacies, with closures more than twice as frequent. This is largely due to their exclusion from preferred pharmacy networks controlled by powerful pharmacy benefit managers. These managers steer customers toward chain pharmacies by offering them lower out-of-pocket costs, while independent pharmacies receive lower reimbursement rates.

From 2019 to 2021, pharmacy closures affected 41 out of 50 states, leaving almost 92 million people in areas with fewer pharmacies. Seven states—Illinois, Maine, Mississippi, New York, Pennsylvania, Rhode Island, and Vermont—were hit hardest, with over half of their counties experiencing a decline in pharmacies. Closures were most prevalent in Black, Latino, and low-income neighborhoods, as well as areas with high numbers of Medicare and Medicaid recipients. Black neighborhoods saw pharmacy closures at a rate of 38%, while Latino neighborhoods experienced 36%, compared to 28% in white neighborhoods.

The study, published in Health Affairs, indicates that these closures may exacerbate health disparities, particularly for marginalized communities who rely on pharmacies for essential services like prescriptions, vaccinations, and health management for conditions like HIV and opioid use disorder. Researchers advocate for policies that support the inclusion of independent pharmacies in preferred networks and improve Medicare and Medicaid reimbursement rates to safeguard access to pharmacies, especially in underserved areas at risk of becoming “pharmacy deserts.”

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