In Montgomery, Alabama, a black wreath hung on the door of Adams Drugs, located near the Alabama Statehouse, symbolizing the number of local pharmacies that have closed or are at risk of shutting down.

According to the Alabama Independent Pharmacy Alliance, many independent pharmacies in Alabama have closed in the past two years due to the high cost of dispensing drugs compared to the reimbursement they receive from pharmacy benefit managers (PBMs).

Senator Billy Beasley, a retired pharmacist and Democratic senator, highlighted the challenges faced by drugstores, stating that nearly one pharmacy per week is going out of business because of low reimbursement rates from PBMs for filling prescriptions.

Alabama, along with other states such as Mississippi and Arkansas, is considering new regulations on pharmacy benefit managers to address these issues. The Alabama Senate recently voted 32-0 to advance a bill that would mandate minimum reimbursement rates for community pharmacists, with the legislation now moving to the Alabama House of Representatives.

Pharmacy benefit managers aim to lower drug costs for consumers by leveraging their purchasing power with drug companies. However, independent pharmacists argue that their business practices often result in losses on a significant number of prescriptions.

The proposed Alabama bill seeks to ensure that PBMs reimburse community pharmacies at rates equivalent to those set by the Alabama Medicaid Agency and prohibits practices like "spread pricing," where benefit managers charge health plans more for drugs than they pay pharmacies.

Critics of the bill claim that implementing a $10.64 fee on prescriptions, which matches the state Medicaid rates, could result in increased costs for consumers and businesses. For instance, Helena Duncan of the Business Council of Alabama warned that small businesses, already struggling with providing insurance to employees, might have to bear the additional burden or pass it on to workers through higher premiums.