Thank you to the members of the Standing Committee on Finance for the invitation to speak today. I'm here not only as an executive board member of Canadian Doctors for Medicare, but also as a pediatrician currently training to be a pediatric emergency specialist at the Children's Hospital of Eastern Ontario here in Ottawa.
Founded in 2006, Canadian Doctors for Medicare provides a voice for doctors from coast to coast to coast, advocating for evidence-based, values-driven reforms to our public health care system.
At present, Canada is the only developed nation with universal health care and no corresponding coverage of prescription drugs. Medications administered in hospital are covered, yet once patients are discharged to home, they must deal with a patchwork of systems to obtain their necessary medications. These inefficiencies have contributed to higher drug costs. Canada currently spends $1,012 per capita on prescription medications, the third-highest in the world only after the United States and Switzerland, and well above the OECD average of $709.
In Canada, 36% of drug costs are funded through private insurance plans, 36% through provincial drug plans, and 22% through patients' out-of-pocket funds. This means that many Canadians face financial barriers when trying to access the medications needed to keep them healthy.
Studies have shown that one in 10 Canadians are unable to afford their medications as prescribed. In 2016, about one million Canadians reported cutting back on essentials like food and heating in order to afford their medications. When Canadians cannot afford their medicine, their health suffers. In addition to the very real personal consequences of poor health, cost-related non-adherence can also create wider social and economic burdens. When people cannot take the medicine needed to keep them well, health problems can worsen to the point where more serious and expensive acute care is required.
As a pediatric emergency doctor, I have seen children coming into our department because their parents could not afford their asthma inhalers. Studies have shown that for every 1% increase in the proportion of income spent on asthma medications, children are 14% more likely to present with asthma attacks requiring care in urgent care clinics and emergency departments. This should not be happening in Canada, and we can do better.
This is why Canadian Doctors for Medicare advocates for universal, single-payer public pharmacare to improve access to necessary medications for all Canadians. The June 2019 Hoskins report, “A Prescription for Canada: Achieving Pharmacare for All”, provides a detailed roadmap for how to achieve this vision. The first steps include creating a national, evidence-based formulary of medications that are clinically effective and cost-effective. Provinces and territories could then opt into pharmacare by agreeing to national standards and funding parameters. Hoskins recommended copayments of $2 to $5 per medication, with no household paying more than $100 per year.
Studies have demonstrated that universal public drug coverage in Canada could reduce total spending on prescription drugs by $7.3 billion. Bulk purchasing and thoughtful, evidence-based drug selection would help to reduce costs. Pharmacare could save the private sector an estimated $8.2 billion. Employers and unions that sponsor increasingly expensive and unsustainable private drug coverage plans could benefit and enjoy significant savings for their businesses.
Anticipated costs to government could increase by about $1 billion, with a best-case scenario of actually saving our government $2.9 billion. These estimates do not include other potentially significant cost savings, such as decreased tax subsidies for employers to sponsor private plans, reduced administrative costs and the very promising benefits of a healthier population.
Too often, we need to choose between what is right and what is financially feasible. Pharmacare offers a rare opportunity to do both. We can have a tremendously positive impact on the health and lives of Canadians with the potential for great economic benefit. This is the unfinished business of medicare. It is a rare opportunity to build upon our Canadian legacy.
Thank you very much for your time and consideration. I would love to hear any questions or discussion.