After months of negotiations – and tireless campaigning by patients, advocates, and health care providers – the Liberals and the NDP have reached a deal on pharmacare.
As per the supply and confidence agreement, the Liberals must introduce legislation by the end of this week that lays out a framework for a national pharmacare program – a bill that the NDP has insisted must result in a single-payer system.
We won’t know the details of that legislation until it’s tabled, but several leaks (if correct) have suggested the Canada Pharmacare Act will include plans to develop a list of essential medicines that would be covered by pharmacare and a bulk purchasing plan, as well as an “implementation council” to advise on financing.
In the more short-term, the Liberals have agreed to fast-track universal coverage for birth control and diabetes medication through a single-payer system.
This represents one of the biggest advances in Canadian health care in decades but it’s nevertheless a fragile victory. The program would be life-changing for people who rely on birth control and diabetes medications, and after the legislation is passed we hope the formulary will be expanded so more people can have that life-changing access to medicines.
Here’s what we know so far about the features and scope of the proposed plan:
No out-of-pocket costs
Prescription drugs covered under the national pharmacare plan, which will start with diabetes and birth control medications as a first step, will be available free of charge at the pharmacy. That means that unlike existing public or private drug plans, there will be no deductibles or co-payments. This is a key element for ensuring access to medicines based on need, not on income.
“You walk into the drugstore with your health card and your prescription to get (your medications). You walk out, you don’t pay any money. You don’t pay any prescribing fees, none of that. That’s the intention,” a senior NDP source told the Toronto Star.
Single-payer
The federal government will be the sole purchaser for drugs covered under the national plan. Although that list of drugs is initially quite limited, as it expands (more on that below), the federal government will be able to negotiate large price discounts, like other countries do.
Call it the Costco model of pharmacare – by buying medicine in bulk for all Canadians, we can negotiate much better prices. The Parliamentary Budget Office conservatively estimated those savings at $2.2 billion per year on drug costs alone, though other estimates have suggested as much as $11 billion per year.
Laying the foundation for a single-payer pharmacare program that covers a comprehensive list of prescription drugs would be a big win. Big Pharma has vociferously attacked single-payer pharmacare, for obvious reasons: they like being able to price-gouge Canadians. Canadian prices of patented medicines are among the highest in the OECD – topped only by the U.S.
Containing Canada’s soaring drug prices was one of the main reasons the Liberal government’s expert panel recommended a single-payer model for pharmacare:
“Our current fractured system … weakens Canada’s negotiating position with pharmaceutical companies. We pay some of the highest drug prices in the world. Other countries with universal pharmacare get better deals for the same drugs. Without price reductions, our public and private drug plans will continue to be strained.”
Universal
Everyone in Canada with a health card will be eligible for coverage under the national pharmacare plan, not just the uninsured.
Unlike the Canadian Dental Care Plan, there will be no income cut-offs or eligibility rules that exclude people covered by existing plans, public or private.
This is a significant win, considering how strongly the insurance industry lobbied for a pharmacare program that only covers the uninsured. Such a program would have done nothing for the nearly 60% of Canadians with private insurance plans who nevertheless can’t afford their prescription drugs due to high co-payments or deductibles.
Public
Pharmacare will be delivered through provincial drug plans. Public administration is a cornerstone of our public health care system, and this is in line with the recommendations of the Liberals’ own appointed advisory council on pharmacare. This is a welcome change from how dental care was done.
Working through the provinces is, however, a double-edged sword. Provincial opposition will slow down rollout, with Alberta and Quebec premiers already announcing they will seek to opt out. Provinces governed by NDP administrations like Manitoba and British Columbia, as well as Atlantic provinces are most likely to jump on board first.
Only diabetes and birth control drugs covered – to start
The biggest downside with what’s been announced is that the initial list of medications covered (the “national formulary”) is very limited.
Only birth control and diabetes medications will be covered to start. This will include a range of birth control, including IUDs and emergency contraception, most commonly known as morning-after pills. All insulin for Type 1 and Type 2 diabetes will be covered, as well as additional diabetes drugs and a fund for supplies such as devices for glucose monitoring. Ozempic, a drug often used for non-medical weight loss purposes, will not be covered.
The incoming legislation is expected to lay out steps for expanding coverage to a longer list of “essential medicines” – which would likely cover about half of all prescriptions and include the most commonly prescribed, clinically important drugs. This is how the Liberals’ expert panel recommended launching pharmacare, which estimated covering essential medicines would require just $3.5 billion in added public funding. That’s less than one percent of the federal budget.
But the Liberals refused to put in more than $800 million per year for pharmacare, according to a source close to the talks. Meanwhile, the government spends billions of dollars on F-35s that don’t fly and carbon capture projects that don’t work.
What next?
This is a big win for those fighting for public, universal pharmacare, but a fragile one.
Winning solid framework legislation rooted in the principles of Canadian Medicare is a huge accomplishment, considering how opposed pharma and insurance industry have been.
But this victory will remain fragile as long as the program is still largely on paper, covering only a limited number of people’s medication needs. A lot depends on how quickly the program can be expanded between now and the next election.
Stay tuned for news as the legislation is tabled, likely later this week.
Nikolas Barry-Shaw
Nikolas is the Trade and Privatization Campaigner for the Council of Canadians and author of the book “Paved with Good Intentions.”
Chip-in to support our work
The Council of Canadians is a grassroots, nonpartisan, independent organization funded almost entirely by tens of thousands of individual Canadian donors. We do not take any money from governments or corporations. Due to our political work, the Council of Canadians is not a registered charity and are unable to provide charitable tax receipts.
