Anita Huberman, Hassan Yussuff
Feb 10, 2019
Every government struggles with how best to support the people it serves. One hopes and assumes that decisions are based on thorough research, meaningful consultations and with the guidance of experts in the field.
So far, the federal government can check off all of these boxes when it comes to pharmacare. It appointed a council of experts to study the issue. The council, in turn, consulted with the public online and in person through town halls and meetings. Canadians will soon learn what kind of plan it ultimately recommends this spring.
But as is common in politics, special interests may yet override what is best for the vast majority of people, including for employers and small business owners who have a lot to gain if the government adopts a comprehensive, public pharmacare system.
Employers currently pay about $12 billion a year to the insurance companies for employee coverage. These costs continue to rise and the reason is largely due to the runaway prices of prescription medications. This prevents Canadian businesses from remaining competitive in the global marketplace to secure the health of their workforce.
Analysis by the Canadian Centre for Policy Alternatives estimates that individuals and employers could spend up to $16 billion less on prescription drugs each year. This means that the pharmaceutical and insurance companies would lose significant profits.
It’s perhaps why these groups are the strongest opponents of a truly universal plan. The Canadian Life and Health Insurance Association has gone as far as asking the federal government to work with its industries to “reform prescription drug coverage in Canada to help improve patient access to the medicines they need at affordable prices, while protecting strong workplace health benefit plans.” The conflict of interest is obvious.
Anyone who has ever run a business, or simply shopped for a family, knows that it’s far cheaper to buy items in bulk. So why wouldn’t that be Canada’s approach toward the purchase of medicines? Drug prices in Canada are among the highest in the world, mostly because our myriad private drug plans dilutes the country’s potential purchasing power on the world market for pharmaceuticals.
Take the example of the hypertension drug amlodipine. It’s sold in both Canada and New Zealand by a Canadian company. In New Zealand, where the government is the single buyer of medicines, it cost $7 for a year’s supply in 2015. In Canada, it cost $88 — more than 10 times what New Zealand paid. That added up to $286 million spent on that drug alone. It’s businesses that are often paying these unnecessarily wasteful, inflated costs through their employee drug plans.
Universal pharmacare would not only help the working poor, the uninsured and the sick, it would also enable Canadian businesses to remain competitive in the global marketplace by securing the health of their workforce at a far lower cost to business and society as a whole. With additional savings, employers could further invest in their workplaces by putting more money toward innovation and technology, skills training, expanded benefits — or even hire more workers.
Besides, under the current system, small businesses — a cornerstone of our economy — are the least likely to offer drug coverage. Simply put, they can’t afford it for the same reason that individuals find it difficult or impossible to get insurance if they have chronic disease — private insurance companies are not charities. Private insurers must charge groups and individuals premiums that reflect their actuarial risk.
Furthermore, one in 10 adults have costly, chronic needs for prescriptions to treat such conditions as asthma, diabetes, hypertension, heartburn or arthritis. Smaller firms have difficulty paying for the prescription drug coverage for someone with such needs or one with a spouse or child in those circumstances. The situation is worse for entrepreneurs who want to work for themselves but have chronic health needs in their families.
It continues to boggle the mind that we pay 30 per cent more for our prescription medications than the average of 14 comparable countries that offer universal drug coverage, including Germany, the UK, France, Australia, Sweden and New Zealand. It’s equally puzzling that we remain the only developed nation with universal health care that lacks universal pharmacare.
These are only a few of the compelling reasons why the country’s leading medical experts, health-care advocates, Canada’s unions and the parliamentary committee on health, all agree that it’s time for Canada to replace the current patchwork system of drug coverage. It leaves hundreds of thousands of people without any coverage and millions of others vulnerable to a loss in coverage if they lose their job or move to another province.
Businesses also care about the health and well-being of the Canadian workforce. Employees that can afford the medicines as and when prescribed will be healthier, happier and more productive.
This is the unfinished business of Medicare, as contemplated by Tommy Douglas, the visionary of our cherished health care system.
The federal government can be on the right side of history as the upcoming election looms. Or it can offer costly half measures that mostly benefit big pharma and the insurance industries and leave the rest of us out in the cold.
Anita Huberman is CEO of the Surrey Board of Trade; Hassan Yussuff is president of the Canadian Labour Congress.