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More local pharmacies expected to disappear in 2024

Local pharmaceutical and medical supply businesses are facing growing challenges, with hundreds closing recently.
More local pharmacies expected to disappear in 2024
Posted at 7:56 PM, Mar 08, 2024

Independent pharmacies may soon be a thing of the past.

"2024, everyone knew was gonna be bad," explained Blake Gillman, George's Pharmacy and Medical Equipment owner and CEO in Indianapolis, Indiana. "It's been worse than anticipated."

Gillman shared some of the issues the independent pharmacy industry is facing with Scripps News Indianapolis. He says over 300 independent stores closed in 2023 and he expects that number to grow in 2024.

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"2024 is looking to be a bloodbath," said Gillman. "I know a dude in Ohio who just closed four stores."

Gillman says until there's some actual change happening, the closing of stores is going to be a common occurrence. He explained that the issue is a result of pharmacies not being fully reimbursed for insurance-covered prescriptions.

"What happens is this: We get a prescription if a patient comes in," explained Gillman. "We pay $100 for that inhaler. We run that prescription to a switch and it kicks back that the insurance company and the patient's copay is a certain amount. If we submit $100, it could kick back that we got paid $80 and the patient pays a $10 copay. So, we lost $10 on that prescription."

Gillman says the loss is coming out of the pharmacy's pocket, and it is happening on 30%-40% of the filled prescriptions.

George's Pharmacy and Medical Supplies shares the challenges independent pharmacies face in 2024.

"You cannot stay in business and remain profitable if all you do is fill prescription medications, and that's because if you run it through insurance you're getting negatively reimbursed," he said.

Gillman said that George's Pharmacy is in good shape due to the diversification strategy they implemented when they started selling medical equipment. That said, he suggested that won't be the case for other independent shops.

"We all know change doesn't happen overnight. And I'm afraid any change that happens may be too late," Gillman said.

This story was originally published by Griffin Gonzalez at Scripps News Indianapolis

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