How would we pay for universal pharmacare?

October 4

The idea of providing universal pharmacare to all Canadians has been kicking around for decades. Such a strategy would change the patchwork of public and private plans currently in existence across the country in favour of a universal single-payer pharmacare program.

But why bother doing so? It’s because universal pharmacare would give all Canadians, regardless of age and financial ability, access to prescription drugs. Such a plan would make drug coverage equitable, sustainable and affordable for everyone.

Currently that is not the case. A House of Commons Standing Committee on Health report found that there are about 70 public and 113,000 private plans in Canada. And, while the majority of Canadians have some type of coverage, there are gaps. For example, 21 per cent of Canadians have public drug coverage through provincial or territorial drug programs but because of eligibility requirements, many have to pay at least some out-of-pocket costs. And, although over 70 per cent of Canadians have full or partial coverage through private drug plans, employment doesn’t guarantee drug coverage — low wage and part-time workers are least likely to have drug benefits through the workplace and about two per cent of Canadians have no coverage at all.

How would universal pharmacare work?

With a federal election just around the corner and campaign platforms likely in the process of being devised, clearly the universal pharmacare conversation is not going away. The question then becomes not if we’ll have universal pharmacare, but how such a program would work.

And that ‘how’ is what leaves us at Thorpe Benefits with more questions than answers.

  • How exactly will Canadians pay for universal pharmacare? Reports suggest that the net cost of such a plan would be approximately $20 billion. This is not a small sum and if it’s not solved by significantly raising taxes, what will have to be sacrificed?
  • Will having universal pharmacare be coupled with any form of responsibility on the part of Canadians? In other words, will there be health education required around certain drugs or lifestyles in order to receive the drug?
  • What exactly will universal pharmacare cover? For example, currently in Ontario 4,400 drugs are listed on the formulary and those eligible for OHIP+ have access to any one of those. But, there are over 10,000 drugs that are not on the Ontario government’s formulary and if someone requires a drug that is not listed, they have to pay out of pocket. With universal pharmacare, will private plan sponsors end up having to create top-up insurance to fill in the gaps? And if that’s the case, will the volume of claims — and the value of each claim — make such plans cost prohibitive?

From what we can see, there are both advantages and disadvantages to moving pharmacare to the public sector and creating a universal system. But until those steps are even considered, the questions raised by trying to understand how such a system would work must be considered.

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