July 02, 2020

Community pharmacies: Going, going, gone

This is all about an industry in crisis. As a pharmacist for nearly 24 years, I have seen many changes, including the introduction of many life-saving medications. Now, independently owned community pharmacies are in need of a life-saving prescription as reimbursement reductions continue to spin wildly out of control.

Our politicians in Augusta and Washington, D.C., have decided the cost of doing business in the private sector is unimportant, while simultaneously abandoning the elusive goal of obtaining discounted prices from the drug companies. Instead, they have elected to dole out hundreds of millions of dollars to insurance companies in order to foster programs that reduce what community pharmacies are paid.

How does this impact Mount Desert Island? Take a good look at what caused Island Pharmacy in Deer Isle to close its doors, and keep in mind that my family’s pharmacy, West End Drug, may be the next in line. Will other community pharmacies follow suit? That remains to be seen. In order for any small business to sustain itself, it must remain profitable. The new rules have overlooked this fact.

There is a common myth that community pharmacies are the cause of high prescription prices. This is simply not the case, and people who depend on what community pharmacies give to their communities may have lots of time to think as short drives into town now are replaced by long round trips in the car in order to fill prescriptions in the future. When a pharmacy is forced to close its doors, an important player in the local health care delivery system is lost. Does the community suffer just because a few people have to drive an hour or more round trip to fill a prescription? You might not think it is such a big deal unless you are the one making the trip, often over and over again.

Or is this just another small step toward consolidation, something that Augusta promotes in so many other aspects of life? Consolidation seems to have become the magic solution which casts its shadow on local schools – why not put a child on a school bus for two or more hours a day? – on local emergency dispatch centers and, in this case, on community pharmacies.

Consolidation or not, the stress on community pharmacies is enormous. We are left alone to fight a major battle. A series of events is threatening the very essence of health care due to a serious failure in public policy-making, and as a result, the health care industry is on the brink of collapse.

Thanks to these ongoing cuts in reimbursements, we have reached the point where small community pharmacies are viewed as disposable. We are being overwhelmed by mandates that are unrealistic, and guidelines that are guaranteed to fail. Augusta is either unwilling or unable to do anything to turn this situation around.

Transformed and empowered, big insurers get bigger, and now exercise total control over the rate of reimbursement for prescription medications as large drug manufacturers exert considerable pressure on the marketplace, while often launching their own mail-order pharmacies. The future of community pharmacies is bleak indeed as they struggle to survive in a market where the line is blurred between the drug companies and the insurers.

On top of this, the budget crunch in Augusta compounded by a bitter partisan feud is now propelling many community pharmacies over a cliff. An expanding Medicaid population is fast becoming a political force to be reckoned with, and Augusta has decided that the best solution is to simply decrease what the state pays to community pharmacies. In other words, shift the cost to the community pharmacy and forget about it. In the short term, politicians can stand up and proclaim that they are saving money. This is the bottom line at the Department of Human Services which seems to have no interest in addressing the impact of this trend on the elderly in particular, and the loss of service that will accompany the closing of numerous community pharmacies statewide.

The federal government has rewritten its rules too in the form of the well-intended, yet seriously flawed Medicare drug bill. At the same time, as I mentioned before, the state and federal government are prevented from seeking discounted prices from the drug companies, while giving hundreds of millions of dollars to the insurance companies to set up a program to reduce what the pharmacies are paid. Add it all up, and a crisis looms.

The state has reacted to the pharmacy crisis, but the proposed group purchasing solution is inadequate and demonstrates the state’s inability to acknowledge the root cause of the problem at hand. Any new state approach here should not be a mere extension of an existing industry practice. A large number of independent pharmacies in the state are already pooling their buying power as part of a larger group of more than 10,000 independent pharmacies nationwide with only a minimal impact on pricing to date.

In effect, the state is ignoring the failure of this initial attempt at collective price cutting, while the state fails to shed any light whatsoever on its fundamental role in the creation of this adverse set of circumstances which are certainly not consumer-friendly now, and likely to become less so in the future absent a fundamental change in attitude in Augusta.

Will we see lots of community pharmacies disappearing in the coming months? I hope this is not the case because a tremendous hardship will be imposed on Maine’s older citizens. And yet, absent recognition of the damage done by the ongoing reduction in reimbursements, and of the need for an immediate end to this process, there is not much room for optimism.

Michael Gilfillan, R.Ph. is the co-owner of West End Drug in Bar Harbor.

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