Thank you to the committee for the opportunity to appear today.
The Smart Health Benefits Coalition is a united advocate for smart, innovative solutions that result in timely and positive change for Canadians. Through our seven member organizations, our on-the-ground advisers support and advise more than 65,000 plan sponsors with their employee drug plans, including over 4,800 union plans. Together, our thousands of advisers across Canada support robust benefit plans for 10 million Canadians and their families.
Let me summarize our top-line perspective on pharmacare.
We fully agree that it is unacceptable that Canadians are currently living with little or no coverage for essential medications, stuck in the gaps between public and workplace systems. Even though 97% have some drug coverage, nearly one in five Canadians still report having some difficulty affording out-of-pocket drug expenses. We recognize that this is an affordability and access challenge that needs smart solutions.
Canada can work with provinces to better solve these challenges faster and more cost-effectively by focusing net new public resources and policy energy on filling the gaps and by taking a progressive approach to affordability.
We believe that universal pharmacare can be done with less money spent, with better and quicker access to drugs, and with less disruption to Canadians' health care treatment plans if the government does it through a targeted, multi-payer system rather than on its own.
We believe that there are a few critical considerations that need attention.
A universal, single-payer, first-dollar coverage model will require taxpayers to carry the whole cost of drugs and fees. Currently, employer plans pay over $20 billion in drug claims, providing medications to Canadian families every year as a well-functioning part of our comprehensive health care system. When looking at the challenges facing Canadians, spending precious new health care dollars where workplace coverage already exists is an expensive, missed opportunity.
The biggest cost pressure and pain point for any Canadian, whether they have coverage or not, lies in high-cost therapies associated with conditions such as cancer, Crohn's disease, cystic fibrosis and many more chronic and rare health conditions that have innovative, life-changing drugs. These cost pressures are potentially devastating and deserve a higher priority within the pharmacare discussion.
We've recently been very concerned to see comments by the government stating that Canadians would retain their ability to choose a new public plan or their existing workplace plan. Like other stakeholders, we are seeking clarity on what universal, single-payer, first-dollar coverage means. This is important. From our industry perspective, this term means that if the public system pays for a certain list of drugs under the Canada Health Act, then employer plans are not permitted to pay for those drugs. The result would appear to have the unintended consequence of impacting the PBO's estimates, which currently assume continued employer coverage, resulting in a savings of $4 billion per year.
This is critical to resolve. If the intent is, in fact, to permit Canadians to choose where they get their coverage from, then we believe this part of the bill needs to be written with clarity and with no room for assumptions.
Let's go over some smart solutions we're proposing.
Let's use net new taxpayer funding in a way that gets coverage and cost relief to those in need, absolutely. Let's require a common, minimal formulary for all employer-sponsored and provincial drug plans to create predictability and a floor of coverage, work with provinces to create a coordinated national system of rare disease and high-cost drug coverage, update the Canada Health Act and work with provinces to include common out-of-hospital therapies, for example, cancer treatments.
Now, specifically, we have proposals to strengthen the bill and framework.
First, ensure that coverage is available to Canadians regardless of province. Without intervening in the core aims of the bill, we propose an amendment that would provide for the Minister of Health to enter into secondary negotiations with a province in the event that a province formally rejects the single-payer pharmacare. This should allow for Canada to negotiate and enter into an agreement with a province where universal, no-cost treatments are made available without the restriction of a single-payer, first-dollar model.
Second, examine opportunities to explore pricing reductions.
Third, provide Canadians with a cost-benefit analysis prior to further steps. We propose an amendment that would ensure that public accounting and cost-benefit analysis be prepared and released prior to any consideration of an expanded single-payer system. Canadians deserve to know the facts and costs before governments take further steps that may irrevocably impact their ability to access and afford the wider range of medications currently provided under workplace plans.
In closing, I want to thank the committee for the opportunity to appear today, and I'm happy to answer members' questions.