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Report: ‘Unprecedented’ pharmacy closures are leaving many without access
Nearly 30% of retail pharmacies have closed since 2010, with those in predominantly Black and Latinx neighborhoods most at risk, according to the data analysis
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Neighborhoods with higher rates of poverty and uninsured residents also saw higher rates of pharmacy closures, the analysis found.Getty Images
The number of retail pharmacies in the U.S. has declined at an “unprecedented” rate since 2018, leaving many, particularly those in predominantly Black and Latinx neighborhoods, without access to medications, according to a new data analysis.
The report, published this month in the health-policy publication Health Affairs, examined data from several sources to determine the number of pharmacies that have shuttered between 2010 and 2021. It also detailed the neighborhood and market characteristics associated with the closures.
Of the 88,930 retail pharmacies operating from 2010 to 2020, 29.4% had closed by 2021, the report found. That’s a significant jump from 2009 to 2015, when 12.5% of pharmacies closed, the analysis said.
“The risk for closure for pharmacies in predominantly Black and Latinx neighborhoods was higher than in White neighborhoods,” the study’s authors wrote. “Independent pharmacies were at greater risk for closure than chain pharmacies across all neighborhood and market characteristics.”
Those closures have continued past the parameters of the study.
Deerfield, Ill.-based Walgreens Boots Alliance announced in October that it plans to close 1,200 stores over the next three years, with 500 closings slated for 2025.
“We are at a point where the current retail pharmacy model is not sustainable,” CEO Tim Wentworth told analysts at the time.
Rival CVS Health in October said it would lay off 2,900 employees as it looks to slash $2 billion in expenses.
“Retail pharmacies are increasingly important providers of emergency and preventative care in the United States,” the report noted. “Yet many are at risk of closing. Such closures have been found to contribute to medication nonadherence, specifically among elderly adults in neighborhoods with few pharmacies.”
The total number of pharmacies in the U.S. actually increased 7.7% between 2010 and 2021, the study found. But between 2018 and 2021, pharmacy closures outpaced openings, resulting in a net 2.1% loss of locations. This trend was largely driven by chain pharmacy closures, the authors said.
“Of all neighborhood race and ethnicity categories, predominantly Black neighborhoods experienced the steepest decline in pharmacies during 2018-21, with 4.8% fewer pharmacies of any type and 12.6% fewer chain pharmacies,” the report said.
Closure rates varied significantly by state, ranging from 17.7% to 40.7%.
Between 2010 and 2021, eight states (Illinois, Indiana, Iowa, Minnesota, Mississippi, Rhode Island, Tennessee, and Wisconsin) saw a net loss of pharmacies. And between 2018 and 2021, all but nine states (Arizona, Colorado, Florida, Idaho, Kansas, Montana, North Dakota, Texas, Washington, and Washington, D.C.) had a net pharmacy loss.
Rural counties saw more closures than urban ones, the report found.
Among the 15,402 neighborhoods with at least one pharmacy in operation during the study period, more than a quarter (25.7%) became pharmacy deserts during that time.
Pharmacies in predominantly Black neighborhoods had closure rates of 37.5%, Latinx neighborhoods 36.5%, and White neighborhoods 27.7%.
Neighborhoods with higher rates of poverty and uninsured residents also saw higher rates of pharmacy closures, the analysis found.
“These findings suggest that closures could worsen existing racial and ethnic disparities in access to pharmacies, medications, and essential healthcare services such as vaccinations, Naloxone dispensing, and contraceptive prescribing,” the report said.
The analysis blamed the significant decline in total pharmacies since 2018 on mass chain pharmacy closures, mergers and acquisitions, and the integration of third-party pharmacy benefit managers (PBMs) with large pharmacy chains.
“Commercial health insurers and public payers such as Medicare and Medicaid incentivize patients to use preferred pharmacy networks managed by PBMs by offering reduced cost sharing for in-network pharmacies,” the report said, adding that those preferred networks often exclude independent pharmacies. “Independent pharmacies, which were much more likely than the chain pharmacies to be located in Black, Latinx, low-income, and disproportionately publicly insured neighborhoods during the study period, were at a higher risk for closure than chain pharmacies.”
The study’s authors advocated for policy change to stem the closures, urging the implementation of mandates that would require independent pharmacies be allowed to take part in preferred pharmacy network programs.
“State officials should also consider policies that increase Medicaid reimbursement for pharmacies most at risk for closure,” the report said. “Given the expected increases in pharmacy closures over the next several years, federal, state, and local policy makers should consider targeted strategies to protect pharmacies most at risk for closing.”
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