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Consequences of Pharmacy Benefit Manager Practices on the Community Pharmacy, Pharmacist, and Profession

September 12, 2019

mungerIn part 2 of this series, Mark Munger, PharmD, explains why the consequences of PBM practices on community pharmacy have wide implications to society, the profession, and the US health care system overall.

Throughout America community pharmacies are closing. Since 2003, about 16 percent of independent rural pharmacies – or roughly 1,230 stores – have closed, with fewer than 6,400 remaining, according to figures released in July, 2019.1,2  Community pharmacy closures are not unique to independent pharmacies as Walgreens recently announced that they will close 200 stores this year.3 These store closings are in addition to the chain closing 200 stores in the United Kingdom.4 Earlier this year, CVS stated the company was closing 46 stores.5   Many persons have written about the potential demise of community pharmacy over the years, including me.6-7  These posts are no long the "Boy Who Cried Wolf”—one of Aesop’s fables, community pharmacy is slowly dying.    

I would like to address community pharmacies’ pre-morbid condition in three parts, why, what are the consequences, and offer some answers to reverse the condition? Part 1 described the problems associated with the current Pharmacy Benefit Manager (PBM)-community pharmacy relationship and made a constructive argument that PBMS are directly or indirectly causing the closures of community pharmacies.  This is part 2:  Consequences of PBM Practices on Pharmacists and the Community. 

The consequences of the PBMs influence on community pharmacies fit into four buckets; 1) Poor working conditions for today’s community pharmacists, 2) Loss of current and future highly-competent motivated talent that are and will be needed to innovate for the profession well into the 21st century, 3) Stagnation in moving to a hybrid system of delivering a greater range of health care services with drug dispensing, and 4) Loss of important pharmacist-provided clinical services to the community.  

Consequence #1   A significant consequence of PBM’s influence on community pharmacies is the deterioration of working conditions for many pharmacists. Margins on prescriptions (a margin is the difference between what the pharmacy pays for a product and what they earn for it) have been shrinking for years.8 With PBMs application of Direct or Indirect Remuneration (DIRs) profit margins require two major changes for community pharmacies to maintain revenue, either increase total prescription sales or decrease inventory costs.  The later becomes much more difficult in this era of escalating prescription prices. Thus, prescription volume is solely driving many community pharmacies.  What is the outcome?

Many community pharmacists are working in conditions that most persons would find completely unacceptable, despite pharmacists’ pay.7, 9-11 Workplace mistreatment includes understaffing, working without breaks, attempting to meet unrealistic metric targets, no or little job flexibility, lack of positive recognition from supervisors, and disgruntled customers.7, 9-11  The expected result is pharmacists are increasingly suffering from emotional exhaustion, feelings of cynicism and detachment from work associated with sense of low personal accomplishment from their employment situation, i.e. burnout.12 Burnout is associated with 20% of pharmacists feeling stress from their employment, adversely affecting their mental health and wellbeing, physical health, quality of the work, and/or relationships with family and friends.7 Not surprisingly, occupational stress is highly correlated with pharmacists looking for new employment in and outside of the profession.

Consequence #2  When the community pharmacist workplace has poor working conditions, these pharmacists are reluctant to promote inspiring young persons to the profession.7 Lack of professional promotion has major implications for sustaining the practice in the future. Promoting the profession is critical to recruiting the best and brightest minds.  To this point, admission rates have been dropping for many years in Colleges of Pharmacy around the U.S.  We will start to see the closure of Colleges of Pharmacy in the U.S. in the near future.  Finally, dropping admission rates may lead to less professional competency, a major problem for decades to overcome. 

Consequence #3  The consequence of #1 and #2 above has led to stagnation of the profession into a greater clinical health care role.  Movements like the “Flip the Pharmacy” intended to move the profession beyond filling prescriptions to greater caring for patients have begun, but are moving slowly. 13 The goal of this program is to graduate > 1000 pharmacies to a clinical service model similar to Centers for Medicare and Medicaid Innovation efforts in primary care practices across the U.S.  These efforts are increasingly difficult as community pharmacies close, pharmacists and support staffs are becoming disenfranchised, and initiatives become difficult to start and sustain in this PBM-enrichment environment.

Consequence #4  The U.S. health care system realizes the importance of pharmacists to patient welfare.14 Recent studies have shown the benefit of community pharmacist involvement in patient care.  Primary care providers believe that comprehensive medication management improves their work-life, reduces burnout and fosters greater achievement in the quadruple aim (quality, access, cost, and work-life of health care providers).15 Greater usage of community pharmacy services assists persons to manage minor ailments.16 A recent study has demonstrated in a retrospective cohort study design that pharmacy closures are associated with persistent, clinically significant declines in adherence to cardiovascular medications among older adults in the U.S.17 There are approximately 67,000 community pharmacies in the U.S. closely located to most persons.  When pharmacies close access to pharmacists is lost. Thereby, part of the community patient safety net is negatively affected.   These services may not be replaced easily by the other community health care sites.

The consequences of PBM practices on community pharmacy have wide implications to society, the profession, and overall U.S. health care system.  Loss of community pharmacies cannot and will not be easily reversed. 

Stay tuned for Part 3 next week.

Mark A. Munger, PharmD, FCCP, FACC, is a professor of pharmacotherapy and adjunct professor of internal medicine, at the University of Utah, where he also serves as the associate dean of Academic Affairs for the College of Pharmacy.  


  1. Rural Pharmacies are closing: Where does that leave patients?   Accessed 08/2019
  2. Lunds & Byerlys quits pharmacy business, closing 14 locations.   Accessed 08/2019
  3. Walgreens to close 200 US stores. Accessed 08/2019
  4. Walgreens posts quarterly earnings beat as prescription drug sales rise.   Accessed 08/2019.
  5. CVS closing 46 stores: See the list of struggling locations that are going away.  Accessed 08/2019
  6. The Noble Community Pharmacy Profession: Is it in Jeopardy?   Accessed 08/2019
  7. Munger MA, Gordon E, Hartman J, Vincent K, Feehan M. Community pharmacists’ occupational satisfaction and stress: A profession in jeopardy? J Am Pharm Assoc 2013;53(3):30-44
  8. Independent Pharmacy Economics Keep Deteriorating.  Accessed 08/2019
  9. Tsao NW, Lynd LD, Gastonguay L, Li K, Nakagawa B, Marro CA. Factors associated with pharmacists’ perceptions of their working conditions and safety and effectiveness of patient care.  CPJ/RPC 2016;149(1):18-27.
  10. Five External Reasons Pharmacists Feel Burned Out, and What They Can Do About It.  Accessed 08/2019
  11. CVS Needs to Treat Their Pharmacy Employees Better.  Accessed 08/2019
  12. Pharmacist Well-Being Consensus Conference.  Accessed 08/2019
  13. Flip the Pharmacy. Accessed 08/2019
  14. “To Err is Human” A Report from the Institute of Medicine. Accessed 08/2019
  15. Funk KA, Pestka DL, Roth MT, Carroll JK, Sorenson TD. Primary care providers believe that comprehensive medication management improves their work-life. JABFM2019;32(4):462-73.
  16. Porteous T, Ryan M, Bond C, Watson M, Watson V. Managing minor ailments; The public’s preferences for attributes of community pharmacies. A discrete choice experiment. PLOS One 2016;03/31 DOI:10.1371/journal.pone.0152257 
  17. Qato DM, Alexander GC, Chakraborty A, Guadamuz, Jackson JW. Association between pharmacy closures and adherence to cardiovascular medications among older U.S. adults. JAMA Network Open 2019;2(4):e192606.
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