Hometown Pharmacy closures are part of a larger U.S. trend

Pharmacy reimbursement is the poster child for why complicated is expensive and unworkable.

https://www.9and10news.com/2026/09/03/hometown-pharmacy-closures-are-part-of-a-larger-us-trend/

Hometown Pharmacy closures are part of a larger U.S. trend

Sheldon Krause    |    09-03-2026 

TRAVERSE CITY — Hometown Pharmacy announced the closure of four Northern Michigan locations this week, part of a nationwide trend that operators say has gotten worse in recent years.

Three of the closed locations are in Traverse City and one is in Muskegon.

The independent pharmacy chain says that increasing costs and low reimbursement rates have made it difficult to maintain the business model.

According to the industry group American pharmacies, more than 30% of independent pharmacies in the U.S. closed between 2020 and 2024.

“That is a trend that is only accelerated with time, and we’re seeing closures across the state of Michigan at a very alarming rate,” said Miguel Rodriguez, executive VP and general counsel for American Pharmacies.

John Gross is the director of the Michigan Independent Pharmacy Association and owns six independent pharmacies in mid-Michigan.

He says current reimbursement rates make it difficult for smaller businesses to carry on.

If I pay $10 for a prescription for a drug to dispense to a patient, I’m going to get reimbursed less than the $10 for it,” he said. “When you’re talking about a $500 drug, we get reimbursed less than the $500. Sometimes it could be $20, $40, $50, $100 less than the cost — and that’s simply not a formula for staying in business.”

Rodriguez points to pharmacy benefit managers as a cause for the closures.

Providers like CVS Caremark say that PBM’s negotiate discounts to lower prices for patients — but Rodriguez says that they also set the reimbursement rates for other pharmacies.

“Pharmacy benefit managers they are not reimbursing pharmacies for the services that are being provided in any sort of adequate amount, and that’s led to financial crisis in these stores,” he said.

These dynamics have impacted both independent and chain pharmacies.

Also according to American Pharmacies, more than 250 chain pharmacies have closed in Michigan since 2024. That includes 70 Walgreens and all 185 Rite Aid locations.

Both Rodriguez and Gross say that the closures of pharmacies can deprive communities of important healthcare resources and lead to worse health outcomes over time.

“If you’re someone who doesn’t have transportation or you can’t get around — how are they getting their prescriptions, and who’s their healthcare professional that’s helping them with immunizations or everything that’s going on?” Gross asked.

Hometown Pharmacy will still operate about two dozen locations in Michigan, Indiana and Ohio. That includes their pharmacy within the Traverse City Munson Medical Center.