Some neighbors on Lorain’s South Side are wondering what’s next after their neighborhood pharmacy shuts down.
“I was shocked. This place has been here for quite a while,” said Nick Salva, who regularly picks up his prescriptions at the Grove Ave Rite Aid.
The location closed its pharmacy counter Thursday, with plans to shutter the story completely in August.
“I really don’t know where people will go. They’ll have to choose another pharmacy and there isn’t one close around here,” said customer Robert Cabrera.
Unless a customer has a different preference, prescriptions will be filled at a Walgreens about 2 miles away from the Rite Aid. Some told News 5 that distance could pose a challenge for some neighbors with mobility or transportation challenges.
“Older people, I think it’s going to be rough, having to find a ride,” Salvo said.
Others said they worry about a vacant storefront and the loss of jobs in the neighborhood.
“We’re going to have an empty building. And there won’t be a service for individuals in the community,” said Cabrera.
RITE AID FILES FOR BANKRUPTCY
It’s among the latest closures for the national chain facing bankruptcy. Since it filed Chapter 11 bankruptcy in October, court records show the company announced 52 Ohio stores would be closing.
RELATED: Rite Aid likely to close hundreds of pharmacies in Ohio and Michigan
In July alone, court filings announced 20 Ohio Rite Aid closures:
- Akron: 325 E Waterloo Rd, 4053 S Main St
- Brookville: 437 N Wolf Creek St
- Canton: 3030 Market Ave NE
- Cortland: 569 S High St
- Defiance: 618 North Clinton St
- East Palestine: 25 W Main St
- Elyria: 142 Broad St
- Englewood: 900 Union Blvd
- Girard: 713 N State St
- Grafton: 479 Main St
- Hubbard: 147 W Liberty St
- Kenton: 130 S Detroit St
- Lorain: 2853 Grove Ave
- Louisville: 613 W Main St
- Napoleon: 1111 Scott St
- Slyvania: 4019 N McCord Rd
- Toledo: 5224 Dorr St
- Youngstown: 4914 Youngstown-Poland Rd, 693 McCartney Rd
PART OF A LARGER TREND
Other pharmacy chains have announced their own closures in recent months. On July 5, neighbors in Cleveland’s Mount Pleasant neighborhood demonstrated in front of CVS, scheduled for closure later this month:
Cleveland community fighting back after learning CVS set to close doors this month
“The margins are pretty small. The average retail margin [for pharmacies] is like 2 percent,” said J.B. Silvers, PhD, a professor of healthcare finance at Case Western Reserve University’s Weatherhead School of Management.
He explained financial struggles within the pharmacy industry have been years in the making as some companies expanded too quickly and faced competition from big box stores.
Additionally, he said pharmacy benefit managers (PBM) have also put more strain on profit margins. The middlemen negotiate prices between pharmaceutical companies, insurance providers and retail pharmacies.
EFFECT ON COMMUNITIES
More often, Silvers said lower-income neighborhoods will feel the effects of companies looking to cut costs.
“They’re going to look at every place they can save money. And one of the places is closing low-performing stores. And unfortunately, many of those are in poor neighborhoods, primarily because the margins are squeezed,” Silvers said.
In the zip code where the Grove Ave Rite Aid is closing, census data shows the median household income is about $37,700. Some believe the working-class neighborhood will feel adverse effects.
“I’m sorry that they’re closing stores down… and very sorry that they chose this one to close down,” said Cabrera.
WHAT’S NEXT
Silvers expects more stores to follow suit as the industry evolves. He cautions other low to moderate-income neighborhoods could also lose their pharmacies.
“The big chains are going to continue to rationalize it and yes, I think there’s going to be more,” he said. “There’s not an economic reason, there’s not a payment reason for them to stay in those neighborhoods.”
He said insurance-covered telemedicine and prescription delivery could help bridge gaps.
South Lorain neighbors expect it to be a challenge without the pharmacy in their neighborhood.
“This is a problem,” Cabrera said. “And the real subtext here is no one seems to have the answer.”
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