[Opinion] Let's think about it before rejecting universal public drug insurance

[Opinion] Let’s think about it before rejecting universal public drug insurance

In Canada and Quebec, more than 1,000 health professionals and professors in public or health policy have just signed a petition calling for the establishment of a universal public drug insurance plan. They welcome the recent agreement between the Liberals and New Democrats at the federal level, which promises to move forward with such a plan by 2025, but deplore the delays in setting it up.

Quebec risks seeing this as a threat of encroachment by the federal government on its health jurisdictions, but things are more complicated.

First, remember that the federal government has jurisdiction over drugs in two ways: it is up to it to approve drugs (role of Health Canada), and the price of patented drugs is regulated by patent law. . In fact, in recent years, when the same patented drug costs 23% more in Canada than in other OECD countries, it is rather the Quebec government that has sought to prevent the federal government from reducing the prices of patented drugs.

While the provinces offer public drug insurance plans for part of their population, constant dialogue between the federal government and the provinces is still necessary to ensure effective and affordable access. Quebec even agrees to participate since 2015 in the Council of the Federation to negotiate, in association with the rest of Canada, confidential discounts on patented drugs.

An imperfect system

However, our Quebec prescription drug insurance plan is not working well. Introduced 25 years ago, it is based on compulsory private insurance schemes. The system is fragmented and dysfunctional, but very lucrative for private insurers (paid as a percentage of expenses) and pharmacy chains (which abuse professional fees from private plans and hog substantial markups on generic products).

Pharmaceutical companies also have a blast promoting their most expensive products since most private plans will reimburse anything at any price. In many ways, pharmaceutical marketing to physicians drives prescribing habits more than evidence.

In the end, in Quebec, the per capita cost of drugs is 10% more than in the rest of Canada, and in Canada it costs 42% more than the average for OECD countries. Only the United States does worse than Quebec in terms of cost per capita. But paying more does not mean having better access: with more than 8% of Quebecers who cannot obtain their medication for financial reasons, we rank among the worst OECD countries in terms of access.

In Quebec, a couple with two children earning $49,000 a year and covered by the public prescription drug insurance plan must currently pay $1,420 in annual premiums, as well as deductibles and copayments of 35%, up to a maximum of $2322 per year. Note that deductibles and co-payments are based on official drug prices, although sometimes substantial confidential discounts are granted.

Thus, a private or public “insured person” sometimes spends a greater amount than the actual price of the product on deductibles and co-payments. The Quebec government has little interest in modifying this dysfunctional system since, by taxing mandatory private plans at 12.5%, it increases its revenues with the increase in expenditures. Private insurers are also remunerated as a percentage of expenses.

Wider access

By comparison, the United Kingdom has a universal public drug insurance scheme: households normally pay no co-payments or deductibles out of pocket, problems of access are rare exceptions, and the country spends on average half the per capita cost of drugs compared to Quebec. The country has simply equipped itself with important institutional tools to contain costs and reduce the dynamics of over-prescription and under-prescription, tools that do not exist in our fragmented system.

Faced with the problems of access and costs that are rampant across the country, the Canadian government is proposing a universal public drug insurance plan based on the recommendations of the Hoskins report tabled in 2019: reimbursement would be made for the entire population a list of medications based on the one established in Quebec, households would have maximum co-payments of $100 per year, the provinces would have no additional expenses to pay to cover the costs, and the provinces and employers would also have the possibility improve the list of reimbursed medications as they see fit.

The Parliamentary Budget Officer has estimated that such a plan would not only provide better access, but also reduce our total prescription drug costs by 20% by reducing current waste.

Let’s be clear, Quebec can establish a good universal public drug insurance plan on its own without the help of Ottawa. However, the regime’s current structures and incentives pose a significant institutional barrier. The federal government has put an offer on the table that would allow Quebec to increase access to drugs and reduce its costs, while allowing it to adapt the plan to its needs. Before saying no, maybe we should take the time to discuss…

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