RUPRI examines causes and effects of rural pharmacy closings

Published on August 29, 2018

A new research brief from the RUPRI Center for Rural Health Policy Analysis outlines the trends and issues surrounding the high rate of closures among independently owned rural pharmacies.

Researchers found that since 2002, more than 1,200 independently owned rural pharmacies in the United States have closed, with the most drastic decline occurring between 2007 and 2009. The report states that 630 rural communities that had at least one retail (independent, chain, or franchise) pharmacy in March 2003 had no retail pharmacy in March 2018. This decline has continued through 2018, although at a slower rate.

Keith Mueller, professor and head of health management and policy at the University of Iowa College of Public Health and director of the RUPRI Center for Rural Health Policy Analysis, is the lead author on the report.

According to Mueller, the spike in rural pharmacy closures can be attributed to the financial challenges posed to these pharmacies by the implementation of Medicare Part D.

“The biggest challenge for these pharmacies is the delayed maximum allowable cost adjustment and remuneration fees that drive up the cost of providing medications when the payments from Medicare Part D and others do not keep pace,” he says.

The report also states that the closing of so many rural pharmacies can pose significant obstacles to residents living in these communities.

“Local pharmacists are part of the health care system who provide essential services such as counseling residents as prescriptions are filled, attending to residents with mild illnesses that can be treated with over-the-counter medications, providing immunizations, and supporting other local providers,” Mueller says. “Their departure creates a big gap in these communities.”

The report was co-authored by program director Fred Ullrich and doctoral student Abiodun Salako, both in the Department of Health Management and Policy at the University of Iowa.

The full brief is available at bit.ly/2Mth3eO and was recently highlighted in The Washington Post’s “The Health: 202” newsletter.