To be clear, as a financial planner and believer in financial prudence I am not in support of anything that increases the budget burden significantly on either the provinces or the feds. That said, without doing so, can a pharmacare system be productive and cost effective? Absolutely.
The issue itself is very complex and more so than the general public would be able to envision on a day to day basis. What is needed first and foremost and before we get into huge expenses other than negotiators and administration costs is a national drug buying program. Bulk buying and capping what we will pay for drugs in of itself could save the network billions of dollars regardless of whether the payor is the government, an employer sponsored plan or an individual regardless of income. This has the most impact at by far the lowest costs and is the most urgent piece required.
It would be a horrific concept to flat out provide drug benefits to those without an employer plan. Employee sponsors would immediately cancel their coverage so we’d need to plan to pay for drugs for everyone. The cost of this would be far too invasive on a budget that is already running huge deficits both federally and in some provinces depending on the share. Employers should be urged and assisted to continue to provide employee programs and a smart program would help them manage costs and lower their risks. By putting limits on new high priced drugs, low enough the system can bear them but high enough to support the R&D required to develop the drug you could further help them manage their plan inflations. Thought could go into which drugs get approved based on them proving to have a better result or lower cost base for similar drugs with similar results. We could very easily eliminate a large number of DINs that are pharma promoted but not cost effective or better results oriented.
Being a very socially conscious nation we could still aid those without access to a benefit plan or lower incomes. By enhancing programs like Ontario’s Trillium to aid in the costs of drugs above a certain threshold like the current 4% of household income which seems to be fairly reasonable we could support those who need more help. Using those types of programs also allows the government to ensure that only cost effective drugs with proven results are used, with an exception access program continued as a backdrop to support other situations. These networks are mostly already in place and tweaking them would be far more affordable than creating something new.
It’s really time for common sense to prevail and this is a fix that I could foresee all levels of government supporting without partisan borders. Using it as an election cookie and overpromising an increase in budget that may not be necessary is problematic for me, particularly when the most cost effective solution doesn’t require more than some regulations and a good negotiating team. Still a lot of dollars but the savings would be significantly more than the cost and it would be a drop in the bucket to what they are looking to do.