Here at NOVA, we understand the vital role that independent pharmacies play in our communities. These local establishments offer personalized care, expert advice, and a sense of familiarity often missing from the corporate chains. They are particularly important for individuals with more healthcare needs, providing a convenient and accessible source of essential medications and healthcare services. Sadly, independent pharmacies across the nation are facing unprecedented financial challenges. Our partners frequently ask us, “Are independent pharmacies dying?”
It’s no secret that community pharmacies face unprecedented challenges threatening their survival. Estimates suggest that as many as one-third of these businesses could close their doors in the coming years. This alarming trend has raised concerns about the future of healthcare access, especially in underserved areas.
The outlook could be better, but we see nothing but opportunity ahead for independent pharmacies at NOVA. It’s time to go beyond the unwanted impersonal mass-retail trend and the fear and confusion of shopping for healthcare products on-line, by elevating your store value, the way you do business, and become a trusted source and destination for health and wellness in your community!
What’s Happening to Independent Pharmacies?
Independent pharmacies are struggling across the United States, with stores in rural areas being hit the hardest. There are several different reasons, but the most noticeable factors are:
- Corporate consolidation
- Declining reimbursements
- Online competition
Corporate Consolidation
Large drug chains in the U.S. have spent the last few decades merging and consolidating their market power, becoming seemingly untouchable. This makes it increasingly difficult for smaller, independent pharmacies to compete on inventory and price.
Declining Reimbursements
Corporate PBMs (Pharmacy Benefit Managers) serve as intermediaries between insurance companies that pay for prescription drugs and the pharmacies that dispense them. They are setting increasingly low reimbursement rates for prescriptions. This reduction in reimbursements is squeezing the margins of independent pharmacies.
Related Blog: What Are DIR Fees and How Have They Changed?
Online Competition
Community pharmacies worry about the megastore down the street; the same goes for massive online retailers. Online pharmacies and retailers are fiercely competitive, spend lots of money to get in front of your customers, and often enjoy significantly less overhead expenses than the average community pharmacy.
What’s the Impact on American Health?
The closure of independent pharmacies can significantly impact public health – and it already is.
Long distances to travel for medication can be burdensome for individuals with limited mobility, or those living in rural areas. Pharmacies also play a crucial role in providing immunizations and other essential healthcare services to their communities, leaving a gap in care when storefronts close. While many have turned to mail-order pharmacies to receive their prescriptions, they are often not given clear instructions on how to use the drugs or be able to ask questions or express concerns.
There’s no doubt about it: individuals and families suffer when their local health hubs disappear. Your role as a local purveyor of health has never been more important!
Related Blog: Pharmacy Marketing Starts with Your In-Store Experience
Is There Hope For Independent Pharmacies?
While the outlook for independent pharmacies may seem bleak, there is hope. By taking proactive steps and advocating for government reforms, these businesses can increase their financial viability and continue to serve their communities.
At NOVA, we are committed to supporting independent pharmacies and ensuring that all people have access to the essential healthcare services they need. Let’s work together to preserve the vital role of these community-based businesses.
Government Reforms & Immediate Actions
To address the challenges facing independent pharmacies, several reforms and actions can be taken to start solving this public health crisis. One solution could be to increase reimbursement rates for government programs like Medicaid and Medicare (and then expand access to those programs).
States or counties could also provide incentives or credits for independent pharmacies that provide vital health services to stay open. Get to know your local and state representatives and make sure they understand the value you bring to the community. Remember, they serve and represent you!
Additionally, reimbursement system reforms should be implemented to address unfair practices by PBMs. Any reforms should be carefully crafted to ensure independent pharmacies can open up shop in disadvantaged communities and still be profitable.
You don’t have to wait for these reforms to find success in today’s market. Steps that you can take today to set your pharmacy up for success are:
- High-margin products: Focus on the right products to increase revenue.
- Unique retail experiences: Optimize your pharmacy experience to empower customers to find what they need.
- Building customer loyalty: Train your pharmacy staff to build relationships with customers and watch them blossom!
ReNOVAte Your Revenue
Since 1993, NOVA has supplied and supported thousands of successful pharmacies and medical supply stores in the United States. Now we are sharing our knowledge with the world!
You can listen to the HME180 Podcast and hear how Oswald’s Pharmacy, a 150 year old independent pharmacy generates millions of dollars a year providing much needed HME products to their community.
You can also read our independent pharmacy case studies and learn how you can ReNOVAte Your Revenue with a NOVA store reset.
America needs independent pharmacy today, tomorrow and beyond. Let’s come together to ensure that independent pharmacies remain the heart and soul of every community!
