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Keith Mueller, Ph.D. |
But, researchers including UNMC’s Keith Mueller, Ph.D., say the benefit also has contributed to the closing of independently owned rural retail pharmacies.
Dr. Mueller, associate dean for academic affairs in the College of Public Health and director of the Rural Policy Research Institute (RUPRI) Center for Rural Health Policy Analysis at UNMC, is the principal author of a study that shows a rapid increase in such pharmacy closings from May 2006 through April 2008.
“There’s been a real loss in access to prescription drugs and pharmacy services in rural areas,” Dr. Mueller said. “While Medicare Part D has provided access to drug coverage for some previously uninsured patients, and mail order prescriptions to patients without access to a pharmacy, there also may have been some unintended consequences associated with the program.”
Between May 2006 through April 2008, 998 — or 6.8 percent — of the nation’s independently owned rural pharmacies closed while 495 pharmacies opened in rural communities. This equates to a net loss of 503 independently owned rural pharmacies.
Another key finding of the study was that in the case of 158 independently owned rural pharmacies closings, the corresponding communities were left with no retail pharmacy or pharmacy services. Independently owned retail pharmacies usually are small and privately owned.
The study is published in a policy brief this month, which provides policy makers and researchers information about the closure of rural independently owned pharmacies from 2003 to 2008.
It was funded by the Rural Health Research and Policy Analysis Center at the University of North Carolina-Chapel Hill through the federal Office of Rural Health Policy.
The number of rural independently owned retail pharmacies in the United States was relatively constant from 2003 to 2006, peaking around May 2006. During the time frame, two major policies were implemented related to payment for prescription medications:
- Medicare prescription drug discount cards were introduced in January 2004; and
- The Medicare prescription drug benefit began January 2006.
“There’s an important distinction between being able to get prescription drugs and receiving pharmacy services,” Dr. Mueller said. “You can’t rely on getting drugs though the mail when you need them quickly. If the only pharmacy in a small community closes, you have no pharmacy services left. You could drive to another pharmacy in another town, but you have the added time and gas cost.”
The trend for private insurance companies to pay less to pharmacies has now found its way into Medicare, he said.
“Independently owned pharmacies were already in some trouble because of the existing low payments from insurance,” Dr. Mueller said. “Passing the costs of staying in business as an independently owned pharmacy in a remote location to consumers is difficult if nearly all the pharmacy’s customers are enrolled in an insurance plan that limits payment. Medicare Part D could have been the nail in the coffin.”
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Lead author of the study, Don Klepser, Ph.D., assistant professor in the College of Pharmacy, whose expertise is pharmacy economics and access to pharmacy services, said he has been overwhelmed by the number of pharmacists in Nebraska who provide services to the local hospitals, long term care facilities or clinics.
“Access is threatened and if we think access is important, there’s probably something that needs to be done,” he said. “We have a different system for rural hospitals to insure access to services. Do we need something like that in pharmacy services to maintain that access?”
In Nebraska, there were 164 independently owned rural retail pharmacies in May 2006. By April 2008, 22 of them were closed. There are a total of 432 retail pharmacies in Nebraska.
J.D. Nein is a registered pharmacist who owns Nein Pharmacy in Bridgeport — a western Nebraska town with population of 1,594 people.
He bought a pharmacy in Mitchell, Neb., one year before Medicare D went into effect. In November 2006, he had to close the pharmacy. It left the town without a pharmacy or services.
“We didn’t do the volume that was feasible with lower payments and payments that weren’t timely,” Nein said. “We were struggling after Medicare Part D was implemented. The timely payment probably would have helped us. We had a backlog of not getting paid forever. It seemed to really dampen things. Our suppliers expected payment every 15 days.”
He said among late payments were those for items such as $1,200 shots and he noted that it would be 60 days until they’d get paid.
Before Medicare Part D, about 80 percent of his customers were cash-paying customers — the ideal way to receive payment, Nein said. After Medicare was enacted, 80 percent of his customers were Medicare Part D.
“We had no more cash customers. We were going to close but someone offered to buy our prescription files,” Nein said.
That buyer was Walgreens, which served those customers from Scottsbluff, about 10 miles away. Nein said before he closed his pharmacy in Mitchell, his operation had served the nursing home and customers in town — making deliveries twice a day.
“It didn’t help the community. A lot of people were shut-ins. You just don’t get the service a small town pharmacy provides,” Nein said of turning his business over to Walgreens. “You feel bad about having to make the decision to close, but it’s wasn’t viable anymore with the overhead we had.”
Data for the study was obtained from the National Council for Prescription Drug Programs of more than 70,000 pharmacies in the United States.
RUPRI provides unbiased analysis and information on the challenges, needs and opportunities facing rural America. Its aim is to spur public dialogue and help policymakers understand the rural impacts of public policies and programs.
Click here to see a copy of the policy brief. Co-authors of the brief also included Liyan Xu, and Fred Ullrich, both of the UNMC College of Public Health.