HH/NURS 4710: National Pharmacare Program Implementation in Canada

This report delves into the implementation of a national pharmacare program in Canada, examining the dynamic nature of the country's healthcare system and the challenges it faces, particularly regarding access to prescription drugs. It highlights the need for universal drug coverage, the rising costs of medications, and the establishment of the Advisory Council on the Implementation of National Pharmacare. The report discusses the current state of prescription drug coverage, which varies across provinces and territories, and the affordability issues faced by many Canadians. It explores potential solutions, including a universal coverage model, a basic safety net, and modifications to existing public and private plans. The report also addresses issues such as drug formularies, payment mechanisms, and the importance of stakeholder input, including individual Canadians, provinces, territories, and Indigenous groups, in shaping the future of pharmacare in Canada. The report provides a comprehensive analysis of the challenges and opportunities associated with implementing a national pharmacare program, offering valuable insights into the complexities of healthcare policy and its impact on the Canadian population.

Running head: IMPLEMENTATION OF A NATIONAL PHARMACARE PROGRAM IN CANADA 1
Implementation of a National PharmaCare Program in Canada.
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IMPLEMENTATION OF A NATIONAL PHARMACARE PROGRAM IN CANADA
Canada's medical system is dynamic. The medical system was founded based on principles of
portability, universality, public administration accessibility, and comprehensiveness and it faces
more challenges due to its expensiveness. The healthcare system is assigned to the provinces,
and the national government only retain the responsibility of members of the state and the armed
forces. It faces a major challenge in terms of access by Canadians. The healthcare system faces a
major challenge in providing access to medicine to Canadians. A suitable solution will be a
universal drug coverage program.
Prescription drugs are not consistently covered across the country and many citizens cannot
afford the prescriptions they need. According to statistics, about $30 billion dollars was spent in
2016 to fill more than 60 million prescriptions (Canada & Hoeppner, 2010). Pharmacare would
be a suitable solution to this. The system would provide a universal insurance coverage for all
prescriptions. Apart from insured health services such as hospital care, pharmacare falls within
that group in many developed countries. Drug prices have continued to rise in making many
Canadian homes have to choose between paying for prescription drugs and paying for other basic
necessities. In 2018, an Advisory Council on the Implementation of National Pharmacare
famously known as the Council was established to provide advice on how to implement national
pharamacare in an affordable manner.
Medicine is an integral part of the healthcare system. Canada's universal health care system is
unique from that of other developed countries such that prescription used outside the hospital is
not covered. From the onset of Medicare in the 1960's, the intention was to eventually cover
medicine. However, a challenge in reaching a consensus presented itself. This was mainly due to

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a variation in public policy and economic as well as fiscal conditions. The absence of coverage
presents a major challenge. Studies conducted note of a major disparity. The Standing
Committee on Health recommended the establishment of a universal single-payer drug
prescription system.
In Canada, basic Medicare covers prescription given only in hospitals. Coverage of medicine
outside hospital varies. For example, many Canadians and their dependents are covered under an
employer-funded private benefit plan. Out-of-pocket pay is very common among low-income,
self-employed and part-time employee Canadians.
Prescription coverage varies depending on the province and territory, across the coverage of the
region depends on age-group and income group. Some combine both. Its organization presents
serious challenges to Canadians, according to the Conference Board of Canada, an estimated
95% of Canadians are qualified for prescription coverage. Affordability presents a serious
challenge due to annual maximums, co-payments and deductibles. This has resulted in
additional doctor visits and admissions (Law, 2018). Furthermore, it has led to more premature
deaths among working-class Canadians (Lopert, Docteur, & Morgan, 2018).
Expenditure on drugs has grown significantly from an estimated $2.6 billion in 1985 to 33.8
billion in 2017 (Canadian Institute for Health Information, 2017). Canada spends more than
almost any other country in the OECD member countries on prescription drugs. The combined
coverage in Canada is not suitable for innovative drugs. A large burden is placed on households,
employers and governments due to increasing costs. According to the Patented Medicine Prices
Review Board, Canadians spend 20% more than the OECD median on innovative medicine. The
Patented Medicine Prices Review Board (PMPRB) allows the federal government to assert price
controls on innovative drugs. The government seeks to give PMPRB the means of protecting

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consumers from hiked brand medicines by amending the Patented Medicines Regulations.
Through the pan-Canadian Pharmaceutical Alliance, the federal government works with the
territories and provinces to reach terms on lower prices for generic drugs as well as innovative
medicines. It is estimated that savings worth $1.28 billion were attained by CPA.
Over a decade, the number of drug products on the Canadian market with an average annual cost
per patient of more than $10,000 has tripled. This necessitates the improvement of affordability
of prescriptions.
As drug costs continue to rise, employer-funded benefit plans encounter a number of challenges.
Some employers may take up the increased costs while others have their employees take up a
greater share through co-payments, deductibles and annual or lifetime plan maximums or may
choose to limit salaries and health benefits. This results in an increase in individual contributions
to their prescription costs (Lopert, Docteur, & Morgan, 2018). As Canada's population continues
to age and chronic health conditions become more pervasive higher costs will be experienced by
the federal, provincial and territorial governments. This will lead to reduced drug coverage as
well as other health and social benefits.
Cooperation among the stakeholders is essential to come up with a more consistent drug
coverage program. Canada can obtain useful lessons from other countries. Some have mandatory
private (regularly not-for-profit) insurance systems that are regulated by the national government
like Germany. Others like the UK have systems that cover prescriptions through taxes. Some
provide prescription at low costs to patients but at a small fee. Each system has its own merits
and demerits and it is essential to evaluate each.

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Some of the issues that may arise include the individuals or groups to be covered. The purpose of
Medicare was to ensure that access to services is based on need not ability to pay for all
Canadians. One of the main aims of the coverage is to ensure that their equity in access to
services.
There are currently different provincial and territorial drug plans providing coverage to millions
of Canadians. While a large number of businesses provide private drug coverage as well to
millions. Both plans have different rules on the eligibility for coverage by individuals, the
amount to be paid by patients for prescription and the drugs covered. For example, in some
jurisdictions seniors pay hundreds of dollars in deductibles and co-payments while in others they
pay a small flat charge for each medication. Affordability of prescription drugs presents a huge
problem for many Canadians. Affordability presents a serious challenge due to annual
maximums, co-payments and deductibles. This presents a huge challenge in the health of many
Canadians. Possible solutions to the challenge include a universal coverage for medication that
would look like that offered for hospital or medical care (Canada & Hoeppner, 2010). This
would result in individuals covered under a private plan being immensely under a public plan.
Another approach would be to provide a basic safety net above a certain threshold such as 5% of
household income. This is to ensure that no Canadian goes into debt or sells his/her property to
pay for medication. The approach would allow for governments to vary the threshold depending
on what the budget allows. However, it would be less effective at reducing costs and improving
equity.
Another approach would be to leave the current public and private plans as they are and placing
more public funding and regulations in place to seal the loopholes in the system. Also, Canadians

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would obtain either public or private coverage. If standards are not developed, the techniques
could lead to the preservation of current inequities and efficiencies.
Another issue is determining what drugs are to be covered. The main idea is to have under
similar terms and conditions, a comparable list of prescription drugs. To enhance effective
management, many drug plans develop a list of drugs that are qualified for reimbursement along
with their criteria for use. Thousands of drugs are in the market and new ones continue to be
availed yearly. Many of them are expensive. Drug plans eventually make the utmost use their
limited budgets to achieve the best possible outcome. The challenge is greater in public drug
programs which are accountable to taxpayers. Private drug plans are more flexible and usually
provide a wide range of prescription drugs.
Public plans rely mainly on the Common Drug Review conducted by the Canadian Agency for
Drugs and Technologies in Health, to decide which drugs are suitable for reimbursement.
Numerous private plans provide reimbursement for most new drugs that arrive in the market
regardless of whether they are proven eligible. This is known as an open formulary. This is due
to employers who mainly sponsor the private plan as a means to attract and keep employees
since they offer more choices. There is a variation across the country in relation to high cost and
specialized medicine. This is becoming very frequent.
Possible solutions include the creation of a national formulary that would have the same effect. It
could be applied to both public and private drug plans. Furthermore, Canadians could also have
access to drugs not approved for reimbursement through national pharmacare.
Another way is to focus on essential medicines. This is especially those in primary health care.
Individual public and private plans could top-up the list of prescription to be availed. This would

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approach would not cover the full basket of prescription drugs regularly covered in a healthcare
system. Moreover, the challenge of newer, high-cost drugs won't be addressed.
Another way would be to concentrate on most frequently prescribed drugs. The allowance could
be made to allow for a top-up on the list of drugs on the national formulary. It would however
not address the challenge of higher cost prescription drugs.
Also, a comprehensive approach could be applied allowing coverage for a larger list of drugs.
This could entail higher costs but ensure higher equity in coverage and ensure a greater
purchasing power across a wide range of drugs.
Another issue would be the payments for the plan.
It is essential to come up with a mechanism of cost-sharing among governments, the private
sector and individuals. A major issue to be ironed out is if Canadian households will pay a share
of the cost of prescriptions through co-payment, deductibles and annual payments. If so, what
would be the cost?
Depending on the design of pharmacare, implementation could represent a major change in drug
spending from the public to private hands. It would also strengthen the buying power allowing
for negotiation of lower drug prices.
Whether by full cost at the pharmacy, taxes that fund the public plan or premiums for a private
plan, many individual Canadians and employers pay high cost for medicine. The contributions
may change depending on the model. Co-payments for prescriptions, either a small flat fee or a
percentage of the cost, is a means of catering for the cost. Numerous employers back drug
coverage for employees and dependents. They could do so by either a public or private plan.

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Impacts on Canada's economy, ability to pay, administrative and compliance costs for taxpayers
and governments together with competitiveness should be considered when deciding a means to
raise revenue.
In the formulation with a national pharmacare system, it is essential to obtain the views of key
stakeholders such as:
Individual Canadians. Patients form a central part of the system. It is important to get their
viewpoints as they experience the healthcare system. The difference in ideas and concerns may
differ depending mainly on income bracket and gender.
Provinces and territories. They have a large experience in providing public-plan drug coverage to
their population. It is essential to obtain a unique point of view from each jurisdiction.
Assessment of different models and options is essential to establish the impact of
implementation.
Indigenous governments and representative organizations. Despite their area of residence or level
of income, over 830, 000 Indigenous clients (First Nations and Inuit) are covered through the
Non-Insured Health Benefits (NIHB) Program. Through a partnership with the Canadian
government, Indigenous people are continuously leading in the formulation and implementation
of their own healthcare system. Aiding in self-determination and improve health results are the
key implementation of a national pharmacare program.
Healthcare providers. Prescription and dispensation of drugs are mainly done by Healthcare
institutions and clinicians. Clinicians such as pharmacists and nurses have a vast knowledge and
experience and thus are essential to the implementation. It should be noted that they may favour

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approaches that improve access to drugs for patients and may repel alterations that infringe on
prescriber autonomy or choice.
References
Canadian Institute for Health Information, (2017). Information Sheet: Drug Spending at a Glance
Canada, & Hoeppner, C. (2010). Federal poverty reduction plan: Working in partnership
towards reducing poverty in Canada : report of the Standing Committee on
Human Resources, Skills and Social Development and the Status of Persons with
Disabilities. Ottawa: Standing Committee on Human Resources, Skills and Social
Development and the Status of Persons with Disabilities.
Conference Board of Canada, (2017). Understanding the Gap: A Pan-Canadian Analysis of
Prescription Drug Insurance Coverage.
Lopert, R., Docteur, E., & Morgan, S. (2018). Body Count: The Human Cost of Financial
Barriers to Prescription Medications.
Morgan, S., Daw, J., & Law, M. R. (2013). Rethinking Pharmacare in Canada. SSRN Electronic
Journal. doi:10.2139/ssrn.2303892
Patented Medicines Prices Review Board, (2017). Alignment Among Public Formularies in
Canada Part 1: General Overview.
Patented Medicines Prices Review Board, (2017). Annual Report: 2016.

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