In a move that is causing some apprehension across Los Angeles, Orange and Ventura counties, Rite Aid has announced the closure of 154 locations across 15 states as part of its Chapter 11 bankruptcy proceedings, according to a recent report by the Los Angeles Times. California, which is slated to lose a total of 31 stores across the state, is the hardest-hit state in this restructuring process. This development raises concerns about access to essential medicines, especially in lower-income communities, and leaves many areas grappling with the loss of a neighborhood store.
The list of Rite Aid closures includes stores in various Los Angeles neighborhoods, including Glassell Park, Mar Vista and Mid-Wilshire. Additionally, locations in Alhambra, Burbank, Covina, Downey, La Mirada, La Puente and Long Beach’s Bixby Knolls are scheduled for closure in Los Angeles County. Orange County will see six stores closing, while Ventura County will lose one of its final two locations.
Rite Aid’s decision to close these stores is part of its broader effort to restructure its finances. The company is burdened with approximately $4 billion in funded debt and faces annual interest payments of around $200 million. Factors such as record inflation, rising labor costs, declining reimbursement rates and reduced demand for COVID-19 vaccines have contributed to a $750 million operating cost for the 2023 fiscal year.
The closure of Rite Aid stores in these communities represents a significant loss for local residents. As in many cases, they have been serving their communities for decades. Large retail spaces like former Rite Aid locations are often challenging to fill, making their closure even more impactful, adds the report.
Furthermore, Rite Aid’s bankruptcy and the subsequent store closures have raised concerns about “pharmacy deserts” in certain communities. These are areas where access to essential medications and healthcare services becomes limited due to the absence of pharmacies. Lower-income communities in particular, may face challenges in accessing medicine, as drugstore chains often target these areas for closures.
Rite Aid has not disclosed the exact number of employees affected by these closures, but may execute plans to transfer associates to other Rite Aid locations where possible, added the report.
