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Pharmacy Closures More Likely to Affect Low-Income, Minority Neighborhoods. Here’s Why.

In the last two decades, thousands of pharmacies have closed. Public insurance policy, socioeconomic factors have stratified the effects.


“Helping the people. That’s why I am here. I was in ministry for a long time, when I retired from that, I didn’t like retirement so I found something else. I came her as a volunteer, and they asked me if I wanted a full-time job and I didn’t have enough sense to say no” -Doug Cook, Patient Relations Manager. Ozanam Charitable Pharmacy, Mobile, Alabama. February 2020. Doug oversees the recertification of Ozanam’s patients and the operation of the patient service area. Ozanam Charitable Pharmacy is a 501(c) (3) non-profit organization that serves the needs of the community through prescription assistance, focusing primarily on maintenance medications for chronic illnesses – such as heart disease, diabetes and high blood pressure. Each year, over 1704 patients rely on Ozanam to get their medications so they don’t have to choose between feeding their families and managing their illnesses. Ozanam relies on their community and partners like Direct Relief for funding so they can provide free medications for patients. Direct Relief currently provides Ozanam with a regular, bulk refill of medications including insulin and hypertension treatment. Photo/caption: Donnie Lloyd Hedden Jr. for Direct Relief.

Millions of people in the U.S. don’t have a local pharmacy. That means it’s nearly impossible for many of them to pick up prescription medications, meet face-to-face with a pharmacist, and access other health care services. 

Communities confronting this issue are called pharmacy deserts. While the term is relatively new, the issue is not.  

“In 2009 and 2010, we didn’t even know there was a term ‘pharmacy desert,’ but we knew about the lack of medical access,” said Lori Giang, the CEO of NC MedAssist—a charitable pharmacy in North Carolina that sends prescription medications at no cost, both to clinics with in-house pharmacies and to uninsured patients throughout the state.  

NC MedAssist started sending prescriptions directly to patients after realizing many had issues getting to their clinic. “We had patients call and say, look, can you send it directly to my house? Because I don’t always have transportation to my clinic to go and pick it up.” 

Although many people’s notion of health care revolves around treatment by a physician, pharmacists play an important role in America’s health care system, too, seeing most patients more frequently and sometimes for longer appointments than do primary care physicians and providing important services, like medication counseling and chronic disease education.  

However, 1.6 million Americans live more than 20 miles from their nearest pharmacy. Giang estimates two-thirds of her patients fall into that category and many—with incomes less than 200% of the federal poverty level—don’t have cars. “Where states don’t have rural transportation, there’s going to be unmet pharmacy needs,” she said. 

But pharmacy deserts are not just an issue in rural areas. People living in urban communities are also affected. The common factor? Poverty.  

“By definition, pharmacy deserts are neighborhoods that are low income,” said Dr. Dima Qato, the researcher who coined the term “pharmacy desert” in 2014 and an associate professor at the University of Southern California’s School of Pharmacy. That’s because “neighborhoods that aren’t low income may not experience these transportation barriers when they need to get to a pharmacy, so the costs associated with traveling may not be as important.”  

A pharmacist volunteer fills prescriptions at Ozanam Charitable Pharmacy in Mobile, Alabama, in February 2020. (Donnie Hedden/Direct Relief)

In a low-income suburb, for example, someone who doesn’t have a car may not be able to get to a pharmacy just a half-mile away. The distance may not be walkable if it’s intersected by a freeway or in an industrial area. If the person is elderly or has health problems, they may not be able to walk. Other times, crime makes it unsafe to go places by foot. “Geography matters more for low-income people,” said Qato. As a result, they have a harder time accessing medications if there isn’t a pharmacy nearby. 

Additionally, low-income communities are also more vulnerable to losing the pharmacies they do have. In recent years, an increasing number of pharmacies have closed their doors, as higher operating costs and changes to health plans have narrowed profit margins. According to Qato, the closures haven’t affected every community equally: “We found that pharmacies that close, when they close, are more likely to close in low-income, predominantly minority neighborhoods, both rural and urban.”  

The reason, she says, comes down to Medicare and Medicaid policy. “What we see, especially with Medicare and Medicaid, is a lot of these [pharmacies] are getting paid less for prescriptions they fill for Medicaid and Medicare beneficiaries.” As a result, pharmacies serving publicly insured communities make less money and, therefore, Qato said, “don’t have an incentive to stay open.”  

They also don’t get as much business. Because of the way Medicare and Medicaid policy are designed, it’s often more expensive for people who are publicly insured to use the pharmacies in their communities. Most insurance plans, including Medicare and Medicaid, have in-network pharmacies. If someone uses a pharmacy that’s not in their plan’s network, they may have to pay full price for their prescriptions. “What we know is that pharmacies that are more likely to be excluded from those networks are pharmacies that are serving Medicare and Medicaid minority populations in low-income neighborhoods,” explained Qato.  

As a result, people who are publicly insured often have to pay more to fill prescriptions at their local pharmacy and, instead, opt to go to a different pharmacy or forgo their medications altogether. That means pharmacies in low-income communities are “not only paid less per prescription, they have fewer people going in filling their prescriptions,” making them more likely to close, Qato said. 

For some people, the costs of going to a pharmacy that’s farther away, but cheaper, is worth the savings. In Mobile, Alabama, patients at Ozanam Charitable Pharmacy—a non-profit pharmacy that provides medications for free to those who are low-income and uninsured—go to great lengths to afford their medications. “If you have medication that runs $1,200 a month, you’re going to find a way to get it for free,” said Shearie Archer, the pharmacy’s CEO.  

Ozanam serves those in Alabama—a state that chose not to expand Medicaid—who make 200% or below the federal poverty level. Some patients, who live 90 miles or more away, pay family members to pick up their medications. Those who are homeless—about 25% of Ozanam’s patients—come by foot or bike. Others receive help from social service agencies who assign caseworkers to pick up and deliver patients’ prescriptions. 

While these measures can be burdensome, the alternatives for patients are grim. Diabetes medication, for example, can cost hundreds of dollars a month if someone doesn’t have insurance or a pharmacy nearby that takes their plan. “That’s just really cost-prohibitive,” said Archer. For her patients, the choice often comes down to: “Should I pay my mortgage or should I just go without my diabetic medication?” 

Shearie Archer is the Executive Director of Ozanam Charitable Pharmacy in Mobile, Alabama. Ozanam provides medications for free to Alabama’s uninsured. (Donnie Hedden/Direct Relief)

For some, mail-order pharmacies offer a solution. These pharmacies allow patients to order their prescriptions online and get them delivered directly to their homes, no transportation required. When NC MedAssist was looking at ways to increase medication access in North Carolina, their original idea was to build non-profit pharmacies in rural communities. But it would be expensive. “Once you get into the bricks-and-mortar of setting up a pharmacy that costs a significant amount of money, and then you have to staff each of those locations with the pharmacist and that costs money,” said Giang.  

Instead, through their mail-order program, NC MedAssist has been able to reach people throughout North Carolina while reducing costs for both themselves and their patients. 

And, though they don’t see patients in person, they still manage to provide personalized care. The pharmacy monitors how often patients pick up their prescriptions, showing them who may need help adhering to their medication regimen. When one of their patients didn’t order a refill for a hypertensive medication, for example, Giang’s staff noticed. They called to see why the patient hadn’t ordered his next month’s supply and “come to find out he didn’t understand the label,” explained Giang. “He spoke mostly Spanish and he didn’t know what that medication was for, so he didn’t ask for it to be refilled.”  

The pharmacists now print his labels in Spanish, helping the patient to not only take his medication regularly but also have more control over his health. For pharmacies like NC MedAssist, Giang says, “compliance programs are important.” 

But according to Qato, these mail-order pharmacies are not a substitute for the brick-and-mortar pharmacies many communities go without: “Pharmacies aren’t just dispensing prescription drugs, even though dispensing prescription drugs is an important role they play.” Pharmacies offer vaccinations, check blood pressure, and test for Covid-19 and other diseases—all things that can’t be offered virtually.  

“They’re providing all these services for prevention and emergency situations that are critical to the communities they serve, but they can’t provide them if they’re not there,” she said. 

Direct Relief has provided NC MedAssist with $93.6 million in prescription medications, chronic disease care supplies, substance use treatment medications, personal protective equipment, and other pharmaceutical supplies since partnering with the organization in 2014. Direct Relief has provided Ozanam Charitable Pharmacy, which partnered with Direct Relief in 2008, with $1.6 million in pharmaceutical medications, disaster relief supplies, and other medical aid.

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