What Would Pharmacare Mean For Canada?
Government reports don’t usually go rogue and recommend radical change.
But that’s exactly what Health Canada’s June 2019 report on the feasibility of national Pharmacare did.
A year or so earlier, finance minister Bill Morneau set the stage saying Health Canada should study a “fiscally responsible” plan, dealing “with the gaps”, and not “throw out the system that we currently have”.
The Health Canada advisory council ignored that completely, calling the current system “unacceptable”. They recommended a complete overhaul to create a universal, comprehensive, public, national Pharmacare plan.
Pharmacare has become a key issue in this election with three of the major parties in favour of it to various degrees – and one against. But it’s most often discussed in the abstract. What would it actually look like in Canada? That Health Canada report gives us a pretty good idea of what we could expect from universal drug coverage.
How does the system work now?
We don’t have a single system right now, we have 100,000.
Canada currently has over 100 public drug programs and 100,000 private ones. That’s one drug coverage system for every 370 Canadians.
All those systems don’t even cover everyone. 20% of us don’t have adequate drug coverage. The impact of this is real: nearly 3 million Canadians couldn’t afford a prescription drug in the past year. 38% of these had private and 21% had public coverage, but the out of pocket expenses were still too much. They borrowed money, reduced household expenses, or ended up missing part of their treatment.
One in five households have a family member who has skipped prescription medication in the past year due to cost.
Having this many systems leads to big inefficiencies. Canadians pay a lot for prescription drugs, per capita, only the United States and Switzerland pay more. With a single national system, we would increase our buying and negotiating power: if you want to sell your drug in Canada, there’s a single customer you can sell them to.
There is currently a system that allows provinces to negotiate together, and this saves about 2 billion dollars per year. But the savings from a single national system would be over 5 billion dollars more.
What would universal, public, Pharmacare look like?
Health Canada recommends a system that still has small user fees: $2 for essential medication and $5 for all other drugs. For those who need prescription medication regularly, total fees for each household would be capped at $100 per year.
We regularly hear heartbreaking stories of people with particularly rare conditions being unable to access expensive treatment. The plan includes a separate pathway for these sorts of treatments to be evaluated on a case by case basis.
Overall, the Health Canada report says the new system should reflect the underlying principals of the Canada Health Act:
- Universal — everyone has access
- Comprehensive — it includes the broad range of evidence-based treatments that Canadians need
- Accessible — everyone can afford it
- Portable — it shouldn’t matter what province or territory you’re in when you need medication
- Public — run by the government and funded by taxpayer dollars
How much would it cost?
The short answer? 15.3 billion dollars per year. That’s a lot of money, roughly 4% of the federal budget.
Would this mean a tax increase? Maybe. But don’t forget that this is a more efficient system — $5 billion less overall spending every year than the current system. Those savings are seen by nearly every Canadian, on average each year:
- Each family would save $350
- Each employee who has health coverage would save $100 in premiums
- Employers who provide health coverage would save $750 per employee
A tax dollar spent through Pharmacare will go further than a dollar spent through a smaller coverage plan. And it will go further than a dollar you give directly to a drug company.
Where do the parties stand?
Health Canada’s timeline is ambitious, it would require massive political support. With an election just over a week away, where do the major parties stand on national Pharmacare?
Liberals
Despite Bill Morneau’s original idea of a gap-filling strategy, the Liberals have said they are committed to the report’s findings and launching a national plan. They’ve promised $6 billion over 4 years for both Pharmacare and improvements to other health services. Dr. Eric Hoskin, the lead author of the Health Canada report says they are “moving in the right direction” but adds that “more funds will be necessary to implement universal Pharmacare”.
NDP
The NDP has a long history of strong advocacy for national Pharmacare and are running on an ambitious plan to implement a program by late 2020 with an annual investment of $10 billion. That exceeds the initial cost forecasted by the Health Canada report but eventually, it needs to be increased once the program is fully up and running.
Greens
The Greens are running on the same timeline of enacting Phamacare by 2020. This version of the program has been costed at $26.7 billion per year and the party has backed this estimate, showing a strong commitment to the idea.
Conservatives
The Conservatives do not support a unified national Pharmacare plan. Instead, they’ve said they want to focus on filling gaps in our current system. Andrew Sheer says “It’s important to note it’s about the gap. It’s about the people who don’t have access to Pharmacare”. However, they’ve offered few details on how they plan to do this.
Regardless of who wins the election, a program as ambitious as national Pharmacare will take massive public buy-in from across the country to become a reality.
Personally, I think morally it’s a great way to ensure more Canadians have access to the care they need. The Health Canada report convinced me that when you consider the efficiency of such a system, it can also make sense fiscally.
So what do you think? Is it time to adopt a national Pharmacare system? Will you be thinking about it at the ballot box on October 21st?
