Mr. Chair, thank you for this opportunity to discuss our 2016 spring report on drug benefits for veterans. Joining me today is Casey Thomas, the principal responsible for the audit.
In our audit, we examined three areas. First, we examined the process that Veterans Affairs Canada used to add, remove, or limit access to drug benefits. Second, we looked at the department's cost-effectiveness strategies. And finally, we examined how the department monitored the utilization of drugs by veterans.
We found that decisions about which drugs to cover were poorly documented and not clearly based on evidence such as veterans' needs and clinical research. We also found that timelines had not been established for the implementation of decisions. In one case, a decision to limit access to a narcotic was still not implemented two years after the decision had been made.
We recommended that Veterans Affairs Canada implement a decision-making framework that specifies the type of evidence required and how the evidence should be considered. The department should use this framework in deciding which drugs to pay for and to what extent it would pay for them. We also recommended that the framework contain a requirement for the department to update the drug benefits list on a timely basis.
We found that Veterans Affairs Canada used some cost-effectiveness strategies, such as substituting generics for brand name drugs and negotiating reduced dispensing fees with pharmacies. However, the department did not assess whether these strategies achieved the expected results. The department had also not implemented strategies related to expensive new drugs entering the market.
We recommended that Veterans Affairs Canada periodically review its cost-effectiveness strategies to assess whether they were up to date and leading to reduced costs for drugs and pharmacy services. In addition, we recommended that the department identify other potential cost-effectiveness strategies to pursue on its own or in collaboration with other federal departments.
We found that although the department monitored some high-risk drugs, it had not adequately monitored drug use trends that were important to veterans' health and the management of its program.
We recommended that Veterans Affairs Canada develop a well-defined approach to monitoring drug utilization. This approach should serve the needs of veterans and help the department manage its drug benefits program.
With respect to marijuana for medical purposes, we found that the decision to cover marijuana for medical purposes was made at the senior management level rather than by the department's formulary review committee. We were unable to determine why this decision did not go through the committee's normal review process.
We also found that Veterans Affairs Canada had identified the need to contain the rising cost of marijuana for medical purposes and had therefore limited the coverage to 10 grams per day. This amount, however, was double what was identified as appropriate in the department's consultations with external health professionals and more than three times what Health Canada reported to be the amount most commonly utilized by individuals for medical purposes.
The veterans' primary care physician was not always the physician who authorized the veteran to utilize marijuana for medical purposes. Although the department had concerns about such situations, it had not systematically monitored authorization trends to determine whether they were of concern. In addition, the department had not monitored whether veterans using marijuana were also using drugs prescribed to treat conditions such as depression.
We note that Veterans Affairs Canada agreed with our recommendations and committed to taking corrective action.
Mr. Chair, this concludes my opening remarks. We would be pleased to answer any questions the committee may have. Thank you.