Wednesday, April 04, 2018

The drugstore that's taking over your town

CVS has been on a drugstore buying binge. Today it the largest pharmacy chain in the United States by number of locations -- more than 9,600. As the retail pharmacy division of CVS Health, it ranks as the 7th largest U.S. corporation according to Fortune 500 in 2016.

If you've watched independent mom and pop pharmacies disappear, CVS is why.

Business Insider has an in-depth look at this company with this summary: The company got too greedy, and then it got caught.
In its greed, the company squeezed independent mom-and-pop pharmacies. The squeezing wasn't being done by the part of CVS you buy dental floss from or visit to pick up a prescription, though it's not unrelated. It's a behind-the-scenes business known as a pharmacy benefit manager, which manages payments between insurers and pharmacies and drug companies.

The mom-and-pop pharmacies say CVS' in-house pharmacy benefit manager, CVS Caremark, slashed reimbursements for medications sold to their patients on Medicaid. At the same time, they say, it was reimbursing CVS pharmacies at much better rates. With some of them on the verge of going out of business, these pharmacies have rallied lawmakers — both Democrats and Republicans — to put an end to this.

So now CVS faces a tide of resistance to the way it deals with smaller rivals. Already, Arkansas legislators have passed a law aimed at curbing this behavior. This is new regulation in a Republican-dominated state. That's how bad things looked to the lawmakers.
Read the whole thing to get an idea of how this works. CVS is hardly alone.
Russell Andrews, a  neurosurgeon and author of Too Big To Succeed laments “the morphing of American medicine from a function of a humanitarian society into a revenue stream for healthcare profits, drug and medical device companies, hospitals, and insurance companies.  In essence, we have transformed healthcare in the U.S. into an industry whose goal is to profitable.”  Andrews goes on to characterize the profit motive as “a virus” infecting the system.
Support your local mom and pop pharmacy before it disappears.

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