SHOULD Ottawa set up a targeted program, or replace all provincial and private drug programs — even if working fairly well — and establish a new government bureaucracy? The report by Dr. Eric Hoskins, the chair of the federal government’s advisory council on pharmacare, addresses a definite need to expand drug coverage to include all Canadians but overlooks several important issues.
Some 10 to 20 per cent of Canadians are uninsured or underinsured for necessary prescription drugs. The problem is exacerbated by an aging population and a greater number of part-time workers with few drug benefits. Drug costs are rapidly increasing. Generic drug prices in Canada are the third highest in the world. Some drugs in Canada are 10 times as expensive as in New Zealand.
The Hoskins report lists six “comparator countries.” In virtually all, health delivery is national. However, in Canada, health is under provincial or territorial jurisdiction. Hoskins acknowledges that it may take some time before pharmacare is portable and all provinces and territories opt in. This certainly applies to Quebec, which already has a comprehensive, universal drug plan and its own agency to evaluate drugs
Hoskins states, “The council recommends the federal government enshrine the principles and national standard of pharmacare in federal legislation separate and distinct from the Canada Health Act. . . . We are also concerned that amending the Canada Health Act might lead to pressure to make other changes.”
He recommends modest user fees and also that private insurers be allowed to provide private coverage for copayments, as well as for drugs not on the national formulary. He fails to mention that all of the comparator countries also have a blended public/private health delivery system. These are kept fiscally sustainable with shorter wait times thanks to modest user fees and private coverage of some physician services also covered by the public system — all prohibited by the Canada Health Act.
For decades, Ottawa has failed to enforce all parts of the Canada Health Act on all provinces. Quebecers still lack portable medical benefits, and must usually pay out-of-province MDs directly. Except for P.E.I. and the three territories, all provinces have been paying only a small portion of the required amount for hospital care outside of Canada. What assurance is there then that a national pharmacare program would be fairly and adequately policed?
When the Canada Health Act was passed in 1984, Ottawa pledged to pay half of total health costs. However, over the years, its share has dropped to about 21 per cent. Hoskins does recognize that provinces and territories demand secure federal funding before signing a new agreement.
“One party should not be able to make unilateral changes to the arrangement,” the report says.
The words from Hoskins’ report are rather ironic. Recall that in April 2015, when he was Ontario Health Minister, Hoskins unilaterally decreased (some by 30 to 50 per cent) or deleted more than 400 physician fees.
For example, the E078 or “chronic disease code” increased by 50 per cent the fee paid for follow-up visits on patients with some 30 disorders such as diabetes mellitus, dementia, and congestive heart failure. It compensated MDs for spending extra time doing a more complete history and physical exam, discussing dietary restrictions, drug interactions and side effects. It likely kept many patients out of emergency departments. However, to save $14 million, Hoskins unilaterally cancelled this for general internists and to save another $10 million, cancelled it for cardiologists, nephrologists, and gastroenterologists as well.
Next steps? First, “filling the gaps of drug coverage” should be implemented soon at an estimated initial cost of $3.5 billion annually. Very expensive drugs for rare diseases should be covered for all Canadians.
We should eliminate kickbacks to pharmacies first before simply transferring the cost of overly expensive generic drugs to Canadian taxpayers. Because of bulk purchasing, drug prices should drop resulting in a savings of $100 per year in drug premiums and, for businesses, $750 annually per employee (total of $15 billion). Yet the marginal cost to Ottawa would be at least $15.3 billion annually by 2027.
How can we pay for universal drug coverage? The annual federal deficit is already $20 billion. Hoskins is vague about funding. He permits businesses now relieved of costly drug plans to keep the money; he naively hopes that it will be returned to employees as other benefits such as physiotherapy and vision care. Instead, he should recoup most of these dollars so as to reduce the federal debt or tax increases otherwise required to pay for his program.
To help fund drug coverage for all, Ottawa should study and implement ideas from successful blended systems in other countries. It should then amend and modernize much of the Canada Health Act. Both Hoskins’ report and a total reassessment of the Canada Health Act should be discussed when the premiers and territorial leaders meet in Saskatoon from July 9-11 for the Council of the Federation.
(Ottawa physician Charles Shaver is past-chair of the Ontario Medical Association section on general internal medicine. The views here are his own.)