Maryland Pharmacies Closed Amid Reimbursement Disputes
Pharmacists shuttered locations as reimbursement rates from PBMs failed to cover the rising costs of prescription drugs.
Updated on Oct. 3, 2026 in Healthcare
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Should states set minimum reimbursement rates for pharmacies to keep local drugstores open?
As of June 2026, pharmacists in Maryland have closed their businesses due to low reimbursement rates from pharmacy benefit managers. These rates often fail to cover the actual cost of acquiring and dispensing essential prescription medications for patients.
Why it matters
The closure of local pharmacies forces residents to travel significant distances to access medication, leaving more than 525,000 Marylanders living in pharmacy shortage areas. Many pharmacists argue that mandatory minimum reimbursement rates are necessary to maintain a viable business model.
More than 525,000 Maryland residents live in areas currently designated as pharmacy shortages. In the town of Hancock, which has a population of 1,500, residents may now travel 10 to 15 miles to access prescription services.
The players
Ken Reed
He is a pharmacist who shuttered his independent pharmacy in the town of Hancock.
The details
Pharmacists state that current PBM contracts provide compensation below the cost of drug acquisition and dispensing fees. While Maryland law prevents PBMs from reimbursing pharmacies less than their affiliates, advocates are pushing for legislation that mandates reimbursement at or above the cost of the drug plus a set dispensing fee.
Timeline
Maryland passed a law regarding PBM reimbursement rates in 2019.
West Virginia established a policy for NADAC-based reimbursement in 2022.
Proposed reimbursement legislation failed to advance in the 2024 legislative session.
Pharmacist Ken Reed closed his pharmacy in Hancock in June.
Market Landscape
The pharmacy sector is currently experiencing significant consolidation driven by restrictive PBM reimbursement policies that threaten the survival of independent retailers. This trend mirrors broader industry shifts where smaller, independent operators struggle to compete against the economies of scale maintained by large chains and PBM-affiliated entities.
Maryland residents are facing increasing difficulty in accessing their prescriptions as local pharmacies close their doors. Patients may now be required to travel 10 to 15 miles to pick up necessary medications, significantly increasing the time and fuel required for basic healthcare needs.
The takeaway
The struggle between independent pharmacies and PBMs highlights a growing need for transparent reimbursement standards in the pharmaceutical industry. Without policy interventions, patients in rural or underserved areas remain at the highest risk of losing access to essential local care.
Further reading
For more context on the current status of medical access in the region, visit Healthcare.
Source note: This article includes information reported by WBFF.
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Should states set minimum reimbursement rates for pharmacies to keep local drugstores open?
