One Year In: Sole Community Rural Independent Pharmacies and Medicare Part D
Background
The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA) established funding to allow up to 43 million Medicare beneficiaries to enroll in plans providing comprehensive outpatient prescription drug coverage, beginning in January 2006. The new Medicare Part D program changed the means by which Medicare beneficiaries purchase prescription drugs, which affects the business operations of pharmacies. This brief describes the experiences of a random sample of 51 rural independently-owned pharmacies one year after program implementation to determine whether initial financial and administrative problems were resolved over time, focusing on pharmacies that are the sole providers in their community. These pharmacies typically have lower prescription volume than urban and chain retail pharmacies and may consequently have less leverage to negotiate prices with wholesalers. Independently-owned pharmacies are also highly dependent on drug sales as their major source of revenue, making them especially vulnerable to changes in reimbursement. As independents represent approximately half of all retail pharmacies in rural areas, it is of particular importance to understand the impact of Part D on these providers.