BUFFALO, N.Y. (WKBW) — Dozens of Rite Aid locations across Western New York are set to close their doors beginning on June 4, part of a wave of shutdowns happening nationwide.
READ MORE: 'They have concerns': Dozens of Rite Aid stores slated to close in Western New York
The closures come amid growing concern over the role pharmacy benefit managers, known as PBMs, play in rising prescription costs and shrinking pharmacy profits.
New York State Senator Patrick Gallivan said the issue has sparked widespread concern.
“I’ve heard from constituents, I’ve heard from providers, I’ve heard from the pharmacy industry,” Gallivan said. “Many people, probably everybody who’s involved in the healthcare industry, as well as the consumers, have expressed concern.”
PBMs act as middlemen between pharmaceutical companies, insurers, and pharmacies. Pharmacists say they’ve strayed from their original purpose of controlling costs and are now putting financial strain on local pharmacies, especially smaller, independent ones.
Kara Smith, supervising pharmacist at Alden Pharmacy, said the pressure is unsustainable.
“There’s been a lot of pressure on pharmacies, primarily from pharmacy benefit managers or PBMs, with really low reimbursements for the services that pharmacies are offering,” Smith said. “You’re starting to see that impact, especially with the closures of chain pharmacies as well as some of the independents we’ve lost.”
A new bill in the New York State Assembly would require PBMs to reimburse pharmacies at fairer rates, based on national averages or actual acquisition costs.
Supporters point to the state’s Medicaid program, which uses a similar model, as proof that transparent pricing can work. That program has reportedly saved over a $1 billion since launching two years ago.
Lawmakers are hoping to pass the legislation before the session ends in the coming weeks. Without action, advocates said more pharmacies, both chains and independents, could be forced to close, leaving many New Yorkers without easy access to medication.
