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Canadian Pharmacare, Is it Now or Never?

After decades of talking about it, pharmacare is suddenly everywhere.

Given that prescription medication costs are the second fastest growing health care cost in Canada, representing $25 billion annually, a universal pharmacare program could potentially be a policy game changer.

As the Alliance for a National Seniors Strategy has noted, co-payments in prescription medication plans have consistently been found to lead to decreased utilization of prescribed medications. The reduction and elimination of co-pays and deductibles, however, have resulted in increased adherence to recommended and prescribed therapies. Furthermore, it is also well recognized that the inability to access essential prescription medications often has far more severe health implications for older adults than for other populations, and significantly contributes systemically to increased hospital admissions, re-admissions as well as long-term care home placements.

After all, 70% of seniors ages 65 to 79 take at least one prescription medicine, while 30% take at least five prescription medications concurrently. Copays and deductibles add up and reduce adherence. Acknowledging these realities, some provincial governments have trialed programs aimed at improving access to prescription medications for older adults.

In February, the British Columbia government announced that beginning in January 2019 it will eliminate deductibles for families making between $15,000 and $30,000 annually. This would change the current system in which families making $30,000 a year pay a $900 deductible. It’s estimated that 240,000 families, including many older person-led households, would benefit from the change.

Right on the heels of the B.C. announcement, the Ontario government has promised to expand its OHIP+ program to include older Ontarians as well. In January, Ontario introduced OHIP+, a pharmacare program that covers 4,400 prescription medications for everyone 24 and under. In March, the government announced a planned expansion of the medication coverage to all Ontarians aged 65 and older. If implemented next year, the move would save seniors an average of $240 per year.

Even the federal government has entered the pharmacare fray. Last month, Ottawa tapped Ontario’s former Minister of Health and Long-Term Care Dr. Eric Hoskins to lead a federal committee to create national pharmacare plan. Last week, the House of Commons’ standing committee on health published Pharmacare Now: Prescription Medicine Coverage for all Canadians which recommended that Canada create a national, universal, single-payer pharmacare program.

But creating a national pharmacare program is easier said than done. As others have noted, the path the pharmacare is full of obstacles. The first major impediment is inter-governmental cooperation, which is never easy to achieve, as experienced recently with the long road to CPP enhancement. But without serious coordination between the federal government and its provincial and territorial partners, universal national pharmacare would be prohibitively expensive. The virtue of coordination goes beyond politics, regulations, and jurisdictional battles – coordination is essential to reducing the cost of drugs. A coordinated approach, in the simplest terms, would allow a single purchaser with the economy of scale to reduce cost through bulk buying on a national scale.

Although, if we get to the end of that long path, we know what a national pharmacare plan ought to include. It should primarily include coverage for medications to ensure that accessing necessary and appropriate medications doesn’t depend on the ability to pay. It should also ensure that all medications that are prescribed are necessary and appropriate, which would help control costs. Finally, to make a national pharmacare program sustainable, it should purchase medications on a national scale to ensure they are bought at the most cost-effective price possible.

The National Institute on Ageing (NIA) is a university-based think tank focused on leading cross-disciplinary research, thought leadership, innovative solutions, policies, and products on ageing. The NIA’s mission is to help governments, health care systems, pension plans, businesses, and Canadian families to best meet the challenges and opportunities posed to ageing Canadians and by an ageing demographic. Follow us on Twitter and sign up for our mailing list.

By Allan McKee, Communications Officer, National Institute on Ageing | Email: allan.mckee@sinaihealthsystem.ca