People in Canada have long prided themselves on the country’s healthcare system. It’s a reflection of a belief in egalitarianism and compassion for one another. Yet, despite this pride, we know there are gaps in how healthcare is provided. Specifically, the system routinely fails the most vulnerable in society, as it does not currently contain a universal coverage of prescription drugs, commonly referred to as “pharmacare”. The simple fact is that Canada needs a pharmacare plan. This would not only improve the health of those within the country and uphold their right to health, but it would also make more fiscal sense.
It is crucial to understand and look at health as a right, with healthcare as the means to exercise and fulfill this right. Such an idea isn’t simply talk; Canada is a signatory to the Covenant on Economic, Social, and Cultural Rights, which under section 12 explicitly guarantees the right to “the highest attainable standard of physical and mental health.” As a result, the Canadian government has acknowledged and is consequently obligated to uphold this right. For this reason, the Dignity for All campaign model national anti-poverty plan recommended in 2015 the development of a universal, publicly funded National Pharmacare Program to be included in a national strategy to end poverty.
Compared to the general population, those living in poverty in Canada, which is around 5.8 million people or 1 in every 6 people in Canada, have a lower life expectancy, higher cases of mental illness, higher rates of hospitalization for these illnesses, and a higher prevalence of chronic diseases such as arthritis, asthma, and obesity, according to a report by the Public Health Agency of Canada. The connection between poverty and poor health doesn’t just end there. Individuals may experience poverty as a result of having illnesses which can prevent them from working. This then traps them in a downward spiral of poor health and poverty.
Many of the conditions that are caused and exacerbated by living in poverty require prescription medicine as treatment. Yet, while some coverage programs for these prescription medicines exist, such as OHIP+ in Ontario, eligibility varies from province to province and not everyone is included. This means that people are forced to pay out of pocket for them. While receiving coverage through employment is a possibility, currently one-third of those working in Canada don’t receive employer-funded prescription drug coverage, many of whom are women and young workers in particular. Additionally, those stuck in precarious or part-time employment, or those who are unemployed, are often left in situations where private insurance and prescription medicine is unaffordable.
On the other hand, as a report by the Canadian Centre for Policy Alternatives illustrates, private insurance companies currently receive government subsidies of 10 per cent on all of their expenditures relating to prescription medicines, which in 2008 alone accounted for $933 million dollars. Yet, despite receiving this much money in subsidies, the cost of drugs has continued to rise at a rate higher than 10 per cent a year since 1985 and remains further inflated by administrative costs, which add approximately 6 per cent to the sale cost. This can be attributed to the fact that administrative costs in the private industry have shown to be 10 times higher than that in the public sector. As well, although the price of drugs has continued to rise, in 2011, the gap between premiums collected by patients and benefits paid was $6.8 billion, meaning that, for every dollar that patients spend on insurance, they receive $0.74 in return.
The consequences of this system are that 24 per cent of Canadians have no drug coverage, while 8 per cent of Canadians admit to not filling their prescription in the last 12 months due to costs. Such inadequate coverage is especially impactful when it comes to illnesses such as diabetes, where prescription medicine can be the difference between life and death. Yet, 57 per cent of Canadians with diabetes say that they do not take their medication as needed because they cannot afford it. As well, under this system, Canadians are the third-highest spenders on drugs in the world, at an average of $1,100 yearly per person. Ironically, this ends up incurring greater costs on the healthcare system; when individuals are unable to take prescribed medicine, more frequent hospital visits are often the result.
A pharmacare program would resolve many of these issues. As taken from the World Health Organization, if a pharmacare program in Canada were to cover 117 essential medicines that would account for 44 per cent of prescriptions in Canada, and 30 per cent of total drug expenditures in 2015 alone. As well, such a program would reclaim the $560 million that Canadians are spending on administrative fees and save Canadians money by lowering the total expenditure on prescription drugs by 9 to 13 per cent nationwide; this would mean savings of $4.27 billion for patients, while only incurring a $1.23 billion cost for the government. Canada currently spends around $253.5 billion on healthcare, so this increase would only constitute around a 0.5 per cent increase in spending.
The facts are clear, Canada needs a pharmacare program. Not only would it help the most vulnerable in society, but it would end up saving people money.
