60 percent of LTC pharmacies warn of closure amid major drug pricing changes

DATE: March 13, 2025

By Kimberly Marselas
McKnight’s Long-Term Care News

Facing deep losses on high-demand medications, 85% of long-term care pharmacies say they will limit essential services and 60% will close locations without changes to Medicare drug pricing efforts.

Those are among the “unintended consequences” revealed in a Senior Care Pharmacy Coalition survey released Wednesday. The trade association has been increasingly vocal about pricing changes set to go into effect in January. 

Eight of 10 listed drugs are heavily relied upon by long-term care patients, and pharmacies traditionally relied on their higher prices to offset the wide-scale delivery of low-priced generic medications in nursing homes and assisted living facilities.

The negotiations triggered by the Inflation Reduction Act will help Medicare consumers with co-pays but fail to take in the needs of pharmacists working in institutional settings. 

“SCPC has repeatedly warned that, absent congressional action, new Medicare Part D drug pricing policies will soon jeopardize the ability of many LTC pharmacies to maintain operations and continue providing essential, specialized, and legally required pharmacy services to seniors and other LTC patients,” SCPC President and CEO Alan Rosenbloom said. “LTC pharmacies play a unique role in our healthcare system, and there is no substitute for the services LTC pharmacies provide, such as enhanced medication management, consultant services, quality controls and much more.”

But Rosenbloom said the future is “on the line” for these providers.

In addition to closing locations and limiting services, 91% of LTC pharmacies surveyed said they would be forced to lay off pharmacy staff if changes don’t take place. 

When it comes to dispensing certain medications, 56% said they would be “challenged” to keep doing so. And 82% said they would be forced to shift some costs to their long-term care facility clients.

Others said they might eliminate field services, reduce medication deliveries to patients and facilities, limit investments in new technology and infrastructure. Some warned of terminating relationships with “many of their long-term care customers, particularly those in rural and underserved areas that are often more difficult and expensive to serve.” 

Some 75 SCPC members participated in the survey, with many operating multiple locations.

SCPC and the American Society for Consultant Pharmacists have both warned that the drug price negotiations failed to consider the role of pharmacy benefit managers in long-term care. They force pharmacists to absorb the costs of delivering generics, whose use the government has also long favored for its cost-saving implications. LTC pharmacists could counter those losses because they delivered so many of the high-priced name-brand drugs such as the blood thinners Eliquis and Xarelto or Farxiga or Januvia for diabetes.

But the new system disrupts that delicate balance and also fails to take into account the different practices required of LTC pharmacists.

In December, SCPC reported that LTC pharmacies had a dispensing cost of $14.98 per prescription — more than double the average for many other pharmacies. That’s because pharmacies serving nursing homes have to meet additional safety standards and regulations, governing packaging, labeling and quick access to emergency supplies.

SCPC said applying the new Medicare Part D negotiated prices on LTC pharmacies would result in a 27.5% loss. The association is seeking a new $30 LTC pharmacy supply fee to be paid each time a drug with a Medicare negotiated price is dispensed.

“Time is running short,” Rosenbloom said. “LTC pharmacies and the patients they serve are counting on this solution that protects access to essential LTC services.”  

Prices for the first 10 drugs change next January, and another 15 are being negotiated now with their lower prices slated to go into effect in 2027.

Read the full original article here.