Health Committee on Sept. 29th, 2016

[Colin Carrie, Conservative, Oshawa, ON]

In Canada.

[Jean-Denis Fréchette]

Yes. As you know, we appear twice a year before the Standing Committee on Finance with the economic fiscal outlook. We update the outlook twice a year. It's going to be in October. We're scheduled to appear the third week of October with our EFO. That will provide you with some kind of a snapshot of the situation.

[Colin Carrie, Conservative, Oshawa, ON]

That's the fiscal side of things, but what I was talking about is a snapshot—and I believe Mostafa said you could get this—for Canada to help define what the problem is. What would things look like moving forward? Who would have coverage now in Canada, and where are the gaps? Are those without coverage low-income Canadians for whom this is a problem? Is it more some higher-income Canadians, so it may not be as much of a problem to have access? How big of a problem is it for people who don't have insurance?

I see from many witnesses that we need to target in on the people who don't have any coverage and who can't afford the coverage. As my colleague here was saying earlier, we would like to see all Canadians have the necessary coverage they need. Defining the issue now would give us a better idea on moving forward and directing you on policy and on information that would help us develop policy. That's all I'm asking.

[Jean-Denis Fréchette]

Okay, I'm sorry; I thought the snapshot was of the economic situation, but you're talking about the situation of pharmacare—

[Colin Carrie, Conservative, Oshawa, ON]

Yes, the situation we have now.

[Jean-Denis Fréchette]

—and the coverage situation. It would certainly be part of a study, but I'm not sure we can have a snapshot that quickly. It would depend on the availability of the data.

[Colin Carrie, Conservative, Oshawa, ON]

My question is, could you do it? Maybe I should ask Mostafa about that, because I thought in his last answer he said that you could do it.

[Mostafa Askari]

Let me clarify. If it would the wish of the committee for us to do two separate reports, the first one will be the status—

[Colin Carrie, Conservative, Oshawa, ON]

What we have today.

[Mostafa Askari]

—today. If that's the request from the committee, then we'll have to go and look at the data and see what we can do in that area. That will be our first report. Then the committee can, on that basis, give us instructions as to whatever they want us to study around a pharmacare model, and then we'll go and do the second report.

[Colin Carrie, Conservative, Oshawa, ON]

I think it would be irresponsible to jump into something that could be this huge without getting a good idea of the snapshot for today, how we define the problem, and what the best ways are to go about fixing it, so I would definitely appreciate that.

[The Chair, Liberal, Bill Casey]

Thank you, Mr. Carrie.

Mr. Oliver is next.

[John Oliver, Liberal, Oakville, ON]

Thanks very much.

I want to be clear on what I've heard from you, because it has been helpful to have you come back and give us some feedback.

We've heard three potential models here. There's the comprehensive pharmacare program across Canada from the Morgan group. There is another extreme, which is simply that the government provides coverage to uninsured Canadians and the system stays the same otherwise, with all the inefficiencies and cost issues that are locked into it. The third one is more the government providing insurance, but then there's a managed competition model that's layered in to try to improve the efficiency of the system.

What I've heard from you is that you want us as a committee to give you one direction. You want to cost one, or else you'll be costing for the rest of your days, and I'm sure you have other important things to be doing.

Is that a yes? Would you like us to come forward with one model?

[Jean-Denis Fréchette]

Yes. We need direction from this committee saying you want this model.

[John Oliver, Liberal, Oakville, ON]

Okay.

[Jean-Denis Fréchette]

We'll develop terms of reference, we'll come back to your committee, and then we can establish a working plan.

[John Oliver, Liberal, Oakville, ON]

For the private sector spin, the graphs were interesting. You can see that when the pan-Canadian pharmaceutical negotiations started, on the public sector side the expenditure begins ro drop or slow down, whereas the private sector expenditure continues to grow. I think the understanding of how the negotiation of pricing happens in Canada, and how we are situated...I think we're second right now in the G7 for the cost of drugs.

You could look at the G7 costing and move us more to the median or average pricing. Are there similar models you could use to arrive at a target cost of a national pharmaceutical program?

[Mostafa Askari]

That's a very good question, but as I said, we have to go back and do some work and look at these things and see what is available out there and what we can say about them. Again, this is quite a new area for us, so we have to educate ourselves a bit on what's on the line with all these things, and then we can provide some assistance.

[John Oliver, Liberal, Oakville, ON]

You'd look at our initial motion and then come back with questions of clarification and look for direction and suggestions to help narrow down the study and be more focused.

In response to Mr. Carrie's comments, people are paying for those drugs right now on the private sector side. They're paying through employer-based plans or they're paying through their own private insurance that they're purchasing. If we move to a national formulary without increasing costs to private employers or increasing costs to the people who are currently buying private insurance, we would be able to transfer some of that spending to offset the cost of this program to government. Is that spend something you can estimate and collect data on?

We wouldn't increase costs to employers, but at the same time we recognize that they're already paying something here that can be captured and used to sponsor a national program.

[Mostafa Askari]

Well....

[John Oliver, Liberal, Oakville, ON]

A quick example would be a hospital in the MUSH sector. There are already transfers going in to cover the costs of benefits, so governments would be able to recover that.

[Mostafa Askari]

I'm not 100% sure exactly what the question is, but again all these have to be part—

[John Oliver, Liberal, Oakville, ON]

I'm addressing the question of the $16 billion in the private sector, which doesn't necessarily transfer across to the government to sponsor it, because there are already payments being made, so without increasing costs on the private sector, we could recover some of that spend and use it to make this a more affordable program.

[Mostafa Askari]

Certainly that would be the case. There will still be a private sector payment for prescription drugs even after pharmacare, because pharmacare obviously is not going to cover everything. There will be a division between the costs in terms of what the public sector is paying and what the private sector is paying. Whether there will be some kind of savings here in that process that can be used by the federal government is a question that has to be asked.

[John Oliver, Liberal, Oakville, ON]

But the necessary drugs and those in the second tier would be transferable spends, however the government manages it, to help cover the pharmacare program.