KNOXVILLE, Tenn. (Story courtesy of WVLT) – CVS said it could be forced to close more than 100 of its Tennessee locations if proposed state legislation passes. The bill would prohibit pharmacy benefit managers, or PBMs, from owning a pharmacy.
PBMs work as middlemen between pharmacies and insurance companies. CVS operates some of its stores under a model in which the location is affiliated with both a pharmacy and a PBM. CVS’s PBM, Caremark, operates under CVS leadership.
Independent pharmacists said the legislation would level the playing field.
Whitney Walker, a pharmacist at Mac’s Hometown Pharmacy, has worked at the independent pharmacy for more than two decades.
“We end up selling our product for below cost which doesn’t make any sense. How do you keep the lights on? How do you keep robots running? How do you do all of these things?” Walker said.
Walker added more than 150 independent pharmacies have closed statewide in Tennessee in recent years, including two Mac’s locations. She said much of the blame falls on PBMs.
A new state audit found Caremark was giving more benefits to pharmacies affiliated with it than to independent pharmacies.
Hamilton Borden, vice president of community pharmacy at Mac’s, said the bill addresses a long-standing problem.
CVS says the bill would force it to close stores based on its current business model, putting pharmacists out of work. Seth White, a pharmacy manager at a CVS, said his store fills between 3,000 and 3,500 prescriptions per week.
“After you think about that, you come down to earth and say ‘oh my gosh I’m not going to have a job,’” White said.
“It’s going to affect my patients obviously in the immediate, but I also want to think about all of these other pharmacies that are going to struggle,” White said.
He goes on to say he does not believe independent pharmacies would be able to absorb the prescription volume if CVS locations were forced to close. CVS officials said they are exploring possible changes to their business model at some stores and said they do not want to see any closures if the legislation passes.
You can read CVS’ full statement below:
