Dwindling insurance reimbursements ends Brandon Pharmacy’s 14-year run

Tom Wullstein could see the writing on the wall for several years now. His longtime dream of a career as a community pharmacist was coming to an end. And the reason: the pharmacy is taking a loss on every prescription sold, as reimbursements from insurance companies took a sharp drop.

Brandon Pharmacy will close Tuesday, Sept. 17 and all prescriptions are being transferred to Lewis Drug in Brandon.

Wullstein opened Brandon Pharmacy 14 years ago. He first leased space in the Eagle Creek strip mall on the west edge of Brandon and in 2015, he and his wife, Jen, took a leap of faith and constructed Holly Crossing, a four-unit strip mall located at the intersection of Holly and Sioux boulevards. The Pharmacy has occupied one of the four units.

“The insurance companies have lowered the reimbursement to pharmacies so much there’s not other option,” said Wullstein.

A good example of the lowered reimbursements is reflected in Walgreen’s declining stock leading to the closure of 25 percent of their stores.

“If they’re having trouble, the small guy doesn’t have a chance,” he said. 

Wullstein said the insurance reimbursements have decreased every year since first opening Brandon Pharmacy. 

“This is 100 percent the insurance industry screwing people over. They have record profits every year, and your premiums, deductibles, everything gets worse for you. They lower reimbursements for us, and they have record profits. It is criminal that a for-profit company is allowed to make health decisions for people, because when it comes down to it, we could make everyone’; lives better, or we could give our stockholders 25 cents higher price. And they always, always, always choose investors.”

Wullstein said his independent pharmacy isn’t the first in the area to close.

At the end of 2023, Wullstein made the difficult decision to lay off three of his four-person staff. 

“It’s not the way I wanted it to go,” he says sadly. “You do what you’re supposed to do. You go to college, get a doctorate, start a small business in a small town, support the community and it’s not even close to being a viable option.”

As of now, Wullstein said he’ll take some time to close down the business and take some time for his family.

“Then I’ll see what’s available after that,” he said.

The family plans to remain in Brandon. The Wullsteins will also continue to own Holly Crossing.

“It’s a crazy time economically for lots of businesses,” he said. “This isn’t because the community didn’t support us. It’s because we lose money on every prescription we fill.”

Wullstein said if Lewis had closed and transferred all of their prescriptions to Brandon Pharmacy, he would’ve gone bankrupt almost overnight.

“You have to sell other things that make up for losses of pharmacy,” he said, citing HyVee (groceries), Walmart and Target (variety of goods).

He selected Lewis because they are “pharmacy first” and sell other items on the side.

“Their pharmacies are are their main focus, and I appreciate that about them,” he said. “I hope they have better contracts than I have to be able to keep everyone employed, because I feel bad for anyone who’s graduating right now with $100,000 in debt and thinks they’re going to have a 40-year career in this industry, because retail (pharmacy) is not going to be that way. It will be very different in the future than it is right now.”

An example of a common prescription – a three-month supply of blood pressure pills – results in a mere 95-cent reimbursement for Brandon Pharmacy.

“Almost every claim we submit is a kick in the teeth,” Wullstein said.

Going forward, Wullstein said one Medicare plan for next year showed the Pharmacy would lose $5 per generic prescription and $9 for brand-name drugs.

Again, Wullstein puts a plug in for Lewis Drug’s willingness to work with him.

“I am rooting for them,” he said. 

He’s thankful for the local support.

“It was fun while it was viable,” he said. “I wish I could have done more.”