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LETTER: Pharmacare report, Canada Health Act should be on premiers’ agenda

When the Canada Health Act was passed in 1984, the plan was for Ottawa to pay half of total health costs. This only reached a peak of 36 per cent in 1976-77, but is now down to about 21 per cent, writes Charles Shaver. - 123RF
123RF - Contributed

Dr. Eric Hoskins’ recent 171-page report addresses a definite need to expand drug coverage to include all Canadians but overlooks several very important issues.

About 10-20 per cent of Canadians are uninsured or underinsured for necessary prescription drugs.

The rest of the population is covered by a patchwork of public and private plans. The problem is exacerbated by the aging population and part-time workers with few drug benefits. Drug costs are rapidly increasing, and generic drug prices in Canada are already the third highest in the world.

The Hoskins report lists six “Comparator Countries.”

In virtually all, health delivery is national. In Canada, the Constitution requires that health be under provincial or territorial jurisdiction.

Hoskins acknowledges that it may take some time before all provinces and territories are prepared to opt in. This certainly applies to Quebec, which already has a comprehensive, universal but drug plan and its own agency to evaluate appropriate drugs, INESSS.

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.”

He argues, “We are also concerned that amending the Canada Health Act might lead to pressure to make other changes.”

Why does Hoskins keep his program separate? 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.

When Medicare was implemented, the original intent was for Ottawa to pay for half of hospital and medical care costs. The federal share is now down to about 21 per cent. Hoskins recognizes that provinces and territories demand secure federal funding before signing a new agreement, ie. “One party should not be able to make unilateral changes to the arrangement.”

How to proceed?

First, “filling the gaps of drug coverage” should be implemented soon at a cost of $3.5 billion annually. Very expensive drugs for rare diseases should be covered. There should be tighter policing of rebates by generic drug companies to pharmacies (illegal in Quebec and Ontario), which now may be increasing costs. 

Many persons are already covered by private and public insurance plans. Consider that in 2017, there was a total of $29.8 billion spent on prescriptions; $13.4 billion was from public plans, $11.5 billion from private plans, and $5 billion out of pocket.

Thanks to bulk-purchasing, drug prices would supposedly drop, resulting in a savings of $100 per year in drug premiums and for businesses, $750 annually per employee. However, the marginal cost to Ottawa would be at least $15.3 billion annually by 2027.

When Ottawa’s deficit is now $20 billion, how would this be funded? Hoskins is vague. He naively permits businesses — now relieved of paying for employee drug plans — to simply keep the money and return it as other fringe benefits He should recoup most of these dollars  To avoid tax increases and deeper indebtedness, Ottawa should also study and borrow ideas from successful blended systems in the Comparative Countries.

It should then amend and modernize much of the Canada Health Act.

Both Hoskins’ report and a total reassessment — after 35 years — of the Canada Health Act should be on the agenda when the premiers and territorial leaders meet in Saskatoon from July 9-11 for the Council of the Federation.

Charles S. Shaver, MD,


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