Patients Adapt: The Mitigated Impact of Retail Pharmacy Closures

Abstract

Retail pharmacies are the most frequently visited healthcare provider in the United States. They dispense over 150 billion daily doses of prescription medication to Americans each year and offer an array of basic health services to the public. However, the number of retail pharmacies has declined significantly in recent years, with even more pharmacies scheduled to close in the near future. The surge of recent pharmacy closures has raised significant concern about pharmacy access, though there is little evidence on the effects of pharmacy access. This study aims to fill that gap. Using a stacked difference-in-difference approach, I find that patients decrease their prescription drug use following their primary pharmacy’s closure, but only by less than two percent. Instead, patients strongly and rapidly adapt by using mail-order pharmacies and switching from 1-month prescriptions to 3-month prescriptions. There is little evidence that primary pharmacy closure significantly impacts downstream healthcare utilization.

Theodore L. Caputi

Economics & Health Researcher

My research interests include public health, health innovation, and health care.