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Home Canada

97 per cent of Canadians have drug coverage and other lies drug manufactures are pushing

Commentary

by Steve Morgan and Nav Persaud
August 29, 2023
Reading Time: 4min read
A group of people rally in support of Pharmacare.

Public health care advocates and frontline health care worker unions rallied outside the premiers’ summer meeting in Winnipeg on July 12, 2023. Among their demands are universal single-payer pharmacare for Canada. Photo: David Lipnowski/Courtesy: Canadian Health Coalition

Editor’s note: This commentary was first published by the Toronto Star on July 31, 2023.

One in five Canadians had no private or public coverage for their prescriptions in 2021, according to Statistics Canada. A national drug plan would change that.

An anonymous drug manufacturer has teamed up with a private insurance company to give free medicines to select, uninsured residents in two Ontario communities. This is not an act of charity; it is a stunt designed to perpetuate four lies about national pharmacare ahead of related legislation due this fall.

The first false claim behind the stunt is that a supposed 97 per cent of Canadians already have drug coverage so we only need to fill small gaps in the existing system. This false argument comes from an industry-funded report on how many Canadians are technically eligible for private or public drug coverage, even if the coverage in question involves high deductibles or costly premiums that households cannot afford.

In reality, millions of Canadians are uninsured for the medicines they need. According to Statistics Canada, one in five Canadians had no private or public coverage for their prescriptions in 2021. Those lucky enough to have coverage often still face sizable deductibles and co-payments. As a result, about one in six Canadians with drug coverage paid more than $500 out-of-pocket on prescriptions in 2021.

These gaps and inconsistencies in our patchwork of private and public drug plans are large enough that one in 10 Canadians skips prescriptions because of out-of-pocket costs. This makes patients sicker and generates at least $1 billion annually in preventable demand for medical and hospital care.

A second lie is told when a “fill the gaps” alternative to national pharmacare is presented as though current private sector spending on medicines is somehow “free.” It is not. Canadians spend more than $14 billion on private drug coverage, most of which is borne by employers and unions. Under- and uninsured households spend an additional $7 billion out-of-pocket.

Quebec’s experience with a “fill the gaps” approach that maintains work-related private drug plans indicates that adopting such a system nation-wide will increase private spending on medicines by 20 per cent. This would put the direct burden on employers, unions, and patients at $25 billion. In contrast, a universal, public pharmacare program would reduce private spending on medicines by about 80 per cent.

A hand cupped around two pills.
Photo via Unsplash

The billions that are saved is precisely the reason pharmaceutical and insurance companies oppose pharmacare. Each dollar saved is a dollar less available for profit taking. The third lie being told by those promoting a “fill the gaps” approach is that a universal, public pharmacare program would put extended health benefits at risk. In reality, the opposite is true: it is high-cost medicines that are putting workplace health benefits at risk.

Employers and unions support public pharmacare because it would shift the largest and hardest-to-control cost of extended health benefits from them to the administrators of the broader health-care system. This will save them $750 annually per employee. And, contrary to the false claims of pharmaceutical manufacturers and insurers, 85 per cent of employers say they would use such savings to expand other health benefits for employees.

The fourth and final lie being told is that national pharmacare would restrict access to medicines. While Trudeau’s Advisory Council on the Implementation of National Pharmacare recommended the program begin with universal, public coverage of only essential medicines, it also advised that the program expand over time to include all prescriptions of proven safety, efficacy, and value.

No drug program, be it private or public, should cover all medicines regardless of safety, efficacy, or value. A universal, public pharmacare system would ensure coverage decisions are based on what is best for Canadians using processes that are credible, transparent, and accountable. Relying on private insurers to manage the system will lead to decisions based on profit, and potentially billions siphoned off by financial middlemen.

Canadians don’t need tinkering based on lies. They need principled leadership to implement the simple solution that has been studied and recommended many times: a public program that is universal, equitable, efficient, and evidence-based. That is national pharmacare, and that what Canadians want and deserve.

Steve Morgan is an economist and professor of health policy at the University of British Columbia. Nav Persaud is the Canada Research Chair in Health Justice at the University of Toronto and a family physician in Toronto.

Tags: CanadaNav PersaudPharmacarepharmaceuticalprivatizationSteve Morgan
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