Health Committee on Oct. 19th, 2017

[Ron McKinnon, Liberal, Coquitlam—Port Coquitlam, BC]

We're talking pharmacare here, but there's still room for private plans for things like dental coverage and eyeglasses and that sort of thing. Do you think that's a place where you could then specialize?

[Stephen Frank]

Absolutely.

Employers are going to presumably continue to want to offer health benefits to their employees. In every province where we operate in Canada, our business is slightly different. Every public program is different in every province. We adapt to that. We supplement what is there on the public side.

Decisions around what's going to be provided publicly will decide where and how we structure our offer to employers. It's a bit hypothetical. I don't know what the model would look like, but we would take stock of it and we'd see what the opportunities were to provide supplemental coverage on top of that, beside that, or whatever the case may be.

[Prof. Steven Morgan]

Can I quickly comment?

I think this committee also heard from the CEO of the Surrey Board of Trade, a board of trade in my province that brought up to our provincial chamber of commerce a motion in favour of a universal public pharmacare plan, which was passed.

One of the arguments that was made in moving that up to a formal policy or request of that organization was that a public pharmacare program makes extended health insurance more affordable to more small employers. Small businesses in Canada, which are the driving force of the modern economy, are having a hard time continuing to sustain extended health benefits against the high cost of pharmaceuticals, which can be in the order of tens of thousands of dollars if you have an individual patient with a particular need.

If you got that off the books, there would be more opportunity for employers to start investing better in mental health services, dental care, vision care, and so on.

[Ron McKinnon, Liberal, Coquitlam—Port Coquitlam, BC]

Professor Morgan, you mentioned the creation of a Canada pharmacare plan as opposed to expanding or enhancing the Canada Health Act. Would you expand a bit on why you would see us doing that?

[Prof. Steven Morgan]

The principles of the Canada Health Act, particularly as they relate to accessibility, actually forbid there being extra billing or user charges of any kind for what are called “insured services under the act”. The insured services, if you were to add pharmaceuticals, would have to be defined in relation to some sort of national formulary, which would be the minimum package of drugs available to Canadians.

The terms of the act would preclude you from having a copayment on those drugs, and in many cases you probably would want what's again referred to as a value-based copayment that says if the drug is preventative and best value for money in our health system, it's free for patients. If it's more discretionary and perhaps a second- or third-tier drug, value-based formularies internationally might see a patient pay $50 or even $100 for a prescription if it's not a first-line therapy.

The Canada Health Act would preclude you from doing that unless you had specific carve-outs in the act. I don't mean to dissuade you from going down that path in terms of making a recommendation; it's just that you could have a parallel act that had much the same intent, purpose, and outcome as the Canada Health Act, but didn't hold pharmacare to the exact standards of the CHA.

[Ron McKinnon, Liberal, Coquitlam—Port Coquitlam, BC]

Thank you.

[The Chair, Liberal, Bill Casey]

Now we'll go to Mr. Van Kesteren.

[Dave Van Kesteren, Conservative, Chatham-Kent—Leamington, ON]

Thank you, Chair, and thank you all for being here.

Could anybody tell me what the five top drugs administered are? Does anybody know? If we had a health care system, what would be the top five? Maybe, Mr. Frank, you would know that from the insurance industry.

[Stephen Frank]

Do you want to know by drug or by category?

[Dave Van Kesteren, Conservative, Chatham-Kent—Leamington, ON]

Somebody mentioned heartburn medicine. You don't have to name the product line, but what would it be? Would it be drugs for high blood pressure?

[Prof. Steven Morgan]

The leading therapeutic categories are drugs to treat cardiovascular risks, drugs to treat anxiety and depression, drugs for diabetes management, and drugs for asthma and COPD, or airway diseases. There are a handful of therapeutic categories that dominate.

[Dave Van Kesteren, Conservative, Chatham-Kent—Leamington, ON]

What are the ones that dominate? Doctor, you must know. What are the ones that dominate in your practice?

[Dr. Danyaal Raza]

I can only tell you from my own experience. I can't tell you what the top five definitely are.

[Dave Van Kesteren, Conservative, Chatham-Kent—Leamington, ON]

What about the top three?

[Dr. Danyaal Raza]

What I will say is that the way people get sick has changed. When medicare was founded and prescription drugs weren't included, people were breaking their bones, having heart attacks, going to hospitals, being patched up and sent home. A lot has happened since the late 1960s and the 1970s. Now when Canadians get sick, they get sick with chronic diseases like cardiovascular disease, high cholesterol, diabetes, high blood pressure, rheumatoid arthritis, osteoarthritis.

All of these chronic conditions require chronic medications. Rather than just taking antibiotics for seven to 10 days, people are now using prescriptions in other ways. Many people need medications every single day. My patients and patients across the country are facing bigger cost issues and more medically necessary prescriptions. Our insurance system needs to evolve to capture these changes in the way Canadians are getting ill.

[Dave Van Kesteren, Conservative, Chatham-Kent—Leamington, ON]

I would agree with you when you say that things have changed. We used to hear that an ounce of prevention is worth a pound of cure. It wasn't the other way around. What would you think if we had better control over sugar, if we had a better grasp on the effects of processed foods? I've talked about alcohol abuse, lack of exercise, smoking. What effect do you think it would have on the drug industry if we had a better grip on these things?

[Dr. Danyaal Raza]

I don't know what specific effect it would have on the drug industry, but one thing you have hit on is that there are many things that influence people's health, such as their social determinants, their income, and their employment status. It's the employment status that I think is having the biggest impact on people's access to insurance.

[Dave Van Kesteren, Conservative, Chatham-Kent—Leamington, ON]

That's your opinion. We need a study.

[Stephen Frank]

One of the reasons people value their private insurance coverage so highly is that we focus on wellness, which is now the biggest trend and driver in a lot of employment plans. Pilots studies on better treatment of diabetes, better treatment of hypertension, better treatment of mental health issues, health coaches and other types of supports—these are the kinds of things we need to be doing more of. When you look at some of the innovation on the private payer side, you see a lot of really exciting things.

[Dave Van Kesteren, Conservative, Chatham-Kent—Leamington, ON]

I used to be on the finance committee and we used to hear a lot of presentations. There were always recommendations made when the finance minister was going to prepare his budget. In the Conservative Party, we used to ask how we were planning to pay for all these wonderful things. Were we going to cut something out of the budget, and if so, what? How were we going to pay for it all?

Go ahead, Mr. Morgan.

[Prof. Steven Morgan]

We're already paying for it. In fact, we're already paying billions of dollars more than—

[Dave Van Kesteren, Conservative, Chatham-Kent—Leamington, ON]

If it's going to be billions more, how do you propose we pay for these things?

[Prof. Steven Morgan]

This program will cost billions of dollars less than Canadians are already paying for prescription drugs. What we need is to find a revenue tool to move some of the money that is in the private sector—some of the money for publicly financed private drug benefits for people like me, a public employee—into the system. We don't need new money in Canada to run a pharmacare system; we just need a new tool to move the money we're already spending into the system so that it functions more equitably and efficiently.

[Dave Van Kesteren, Conservative, Chatham-Kent—Leamington, ON]

Everybody wants that, and it's all wonderful, but I'm a speaking as a Conservative. This is what I've been entrusted to do. I would recommend that all of us look at what we're really called to do, and that's to balance the books.

Are you suggesting that if we have a pharmacare program, we'll actually save money in this country? Is that what you're suggesting?

[Prof. Steven Morgan]

There's no doubt it will save Canadians money at the end of the day, because there's only one taxpayer. Only one source of money goes into buying drugs today.

In the provinces there has been talk about catastrophic drug coverage as being at least a minimum safety net. That requires that every year people with chronic illnesses pay 3% to 10% of their household income on prescription drugs before benefits kick in.

The cost of a public pharmacare system, in moving money around into such a system by way of federal funding, would be approximately the equivalent of less than one-half of one per cent of taxable income, one-sixth the amount that we think of as a reasonable deductible under a public drug plan. It wouldn't be that dramatic as a way to move money around.