Setting the Context
As health issues become more frequent as one ages, the ability to access medically necessary and appropriate medications becomes increasingly important. The majority of Canadians 65 years and over are currently living with at least one chronic disease, while a growing number are living with multiple.[1] In fact, a recent report found that 1 in 4 older Canadians in 2016 were prescribed medications belonging to 10 or more medication classes.[2]
Older Canadians typically receive some level of provincial or territorial support for access to prescription medications. But the provincial and territorial drug programs for older adults vary across Canada. In most cases, co-pays and deductibles are still in place, which can reduce access.[3] While older adults account for only 17.5% of the Canadian population, they account for 57.4% of the total spending within the provincial and territorial medication programs.[4] With the number of older Canadians set to significantly increase in the coming decades, it is clear that this will place greater funding pressures on the publicly funded prescription medication coverage programs.
The Government of Canada announced in Budget 2018 that the Advisory Council on the Implementation of National Pharmacare would lead a national dialogue on how to implement pharma care.[5] It released its final report in June 2019, calling upon the federal government to work with provincial and territorial governments, and stakeholders, to establish a universal, single-payer, public pharmacare program in Canada.[6] In Budget 2019, the government accepted and agreed to fund the Advisory Council’s recommendations to establish a national formulary, a common list of drugs at a common price, and to establish a national agency to coordinate efforts amongst the provinces and territories.[7]
What Are the Issues?
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Deductibles and Co-Payments Limit Access to Important Medication
Despite having access to publicly funded prescription medication coverage programs, minimum income requirements, deductibles, co-payments, and prescription medications covered vary by province and territory. In some regions, low-income older adults are still required to pay a co-payment or deductible for their prescription medications (see Table 7). However, there is widespread consensus from policy and research evidence that an individual’s access to prescription medications is directly influenced by factors related to their ability to pay, such as their income and ability to pay out-of-pocket costs like co-pays and deductibles. Specifically, co-payments in prescription medication coverage plans has consistently been found to lead to a decreased utilization of prescribed medications; whereas the reduction or elimination of co-pays and deductibles has consistently resulted in increased adherence.[8],[9],[10],[11],[12]
It also well recognized that the inability to access essential prescription medications often has far more severe health implications for older adults than for other populations, and significantly contributes to increased hospitalizations, re-hospitalizations, as well as premature nursing home placements[13]. The negative impact of co-pays and deductibles on prescription medication access has been recognized and addressed in other universal health care systems such as the National Health Service in the United Kingdom, where individuals over 60 years of age do not pay out-of-pocket for their medications.[14]
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Better Procurement Practices Could Help Manage the Costs of the Publicly Funded Prescription Medication Coverage Programs.
In 2018, Canadians spent about $33.4 billion, 15.3% of total health spending, on prescription medication.[15] Prescription drug expenditures are now higher than physician fees with the main cost drivers being the overall use of prescription drugs and the use of newer more costly drugs.[16] Canada’s drug prices are the third highest among OECD countries and are approximately 22% above the OECD average.[17] Currently, the vast majority of the prescription medications covered by publicly funded programs are purchased from pharmaceutical manufacturers at the provincial or territorial level. In negotiating at a provincial or territorial level, the current evidence shows that the prices publicly funded programs pay for the medications they cover are significantly higher than other jurisdictions around the world who negotiate their prices at the national level. Evidence suggests that if nationally coordinated procurement approach for medications was implemented, provinces and territories could collectively save billions of dollars.[18]
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Costs Related to the Inappropriate Prescribing of Medications to Older Canadians
Ensuring older Canadians are taking the correct medications is not only important to ensuring their overall health, but also helps to manage health care expenditures[19]. Indeed, the use of inappropriate prescription medications among older adults is correlated with avoidable hospitalization and hospital readmissions due to adverse drug events (ADE).[20] Furthermore, while evidence-based lists of inappropriate medications for older adults, such as the Beers List, are widely accepted, published, and accessible, nearly 50% of older Canadians are currently taking at least one inappropriate medication with an additional 18% taking multiple inappropriate medications. [21] Mounting evidence supported by the Canadian Geriatrics Society suggests that discontinuing certain potentially inappropriate medications among older Canadians will not lead to adverse health outcomes and will reduce costs associated with ADEs.[22] In fact, older Canadians account for 57% of all hospitalizations due to ADEs; representing approximately $35.7 million (over 80% of costs related to hospitalization).[23] Importantly, with proper oversight, it is estimated that 40% of ADEs are preventable.[24] To address this, health professionals should be trained in how to ensure the proper prescription and monitoring of appropriate medications for older adults will be vital to promoting their health as well as better addressing the avoidable related costs of ADRs.
Table 7. Current Prescription Medication Coverage by Province for Older Canadians
Province |
Coverage |
British Columbia[25] |
Individuals pay their full prescription costs until they reach a threshold level known as their deductible. Once their deductible level is reached, BC PharmaCare begins assisting them with their eligible prescription medication costs for the rest of the year.
N.B This program applies for all individuals in BC and not just older adults. To ensure annual drug costs do not exceed one’s ability to pay, families are also assigned a family maximum, based on a % of one’s net income. If an individual reaches their maximum, BC Pharmacare covers 100% of their eligible drug costs for the rest of the year. For individuals born before 1940, their family deductible is waived if their net annual family income is less than $33,000. BC Pharmacare then covers 75% of eligible prescription medication costs beyond the level of the deductible. For individuals born before 1940 with family income less than $14,000, BC PharmaCare pays for 100% of their eligible prescription costs.[26] Despite the universal nature of the BC Pharmacare Program, mounting evidence is showing that it now routinely achieves the lowest adherence rates of older adults towards filling their prescriptions due to the associated out-of-pocket expenses related to required deductibles and co-payments. |
Alberta[27] |
Older Albertans and their dependents are automatically provided with premium-free drug coverage. Under this program, older adults pay only 30% of the cost of prescriptions up to a maximum of $25 per prescription. |
Saskatchewan[28],[29] |
Under the Saskatchewan Seniors’ Drug Plan, eligible adults 65 years and over pay up to $25 per prescription for medications listed on the Saskatchewan Formulary and those approved under Exception Drug Status claims. The cost of a prescription was increased from $15 to $20 in March 2012, and from $20 to $25 on June 1st, 2019. |
Manitoba[30] |
Manitoba’s pharmacare coverage is income based and is calculated using Canada Revenue Agency information. The minimum deductible for the Manitoba Pharmacare program is $100, with no maximum deductible. Eligible applicants must reapply every year for pharma care coverage. |
Ontario[31] |
Ontario’s Drug Benefit Program employs a co-payment system. Single older Ontarians with an income of more than $19,300 a year, or individuals who are part of a couple with a combined income of more than $32,300 a year, pay a $100 deductible every year for prescriptions filled per person. After that, older adults pay up to $6.11 towards the dispensing fee for each prescription depending on their income levels. Older Ontarians whose incomes fall below the above thresholds pay up to $2 for each prescription filled and no deductible. |
Quebec[32] |
In Quebec, the Public Prescription Drug Insurance Plan is administered by the Régie de l’assurance maladie du Québec and is intended for persons who are not eligible for a private group insurance plan covering prescription drugs, for persons age 65 or older, and for recipients of last-resort financial assistance and other holders of a claim slip (carnet de réclamation). Children of persons registered for the public plan are also covered by that plan.
All persons covered by the public plan must pay an annual premium of between $0 and $616, based on net family income, whether or not they purchase prescription medications under the plan. Older individuals receiving 94% to 100% of the Guaranteed Income Supplement are exempt from paying the annual premium. |
New Brunswick[33] |
Older beneficiaries receiving the Guaranteed Income Supplement are required to pay a co-payment of $9.05 for each prescription, up to a maximum of $500 in one calendar year. Older adults in New Brunswick otherwise have 2 options, they can either enroll in New Brunswick’s Drug Plan and pay a premium and a 30% copayment up to a maximum per prescription based on income levels or enroll in the Medavie Blue Cross Seniors Prescription Drug Program where they pay a monthly premium of $115 and $15 co-pay per prescription. |
Nova Scotia[34] |
Older adults contribute to Nova Scotia’s Seniors’ Pharmacare Program through premiums and co-payments. Older adults must pay a premium each year to join the Seniors’ Pharmacare Program which is calculated based on one’s income and the number of months remaining in the program year. Currently, the maximum annual premium for an older adult is $424.
For single older adults with an annual income below $22,986 or receiving the Guaranteed Income Supplement, there is no premium. If the annual income is between $22,986 and $35,000, the premium will be reduced from the annual maximum. For couples, if the joint annual income is below $26,817, there is no premium. If the joint annual income is between $26,817 and $40,000, the premium will be reduced from the maximum. Everyone has to pay a co-payment of 30% of the total cost of each prescription. Currently, the annual maximum co-payment an older adult would pay is capped at $382. |
Newfoundland[35] |
In Newfoundland, under the 65 Plus Plan, costs of prescription drugs are paid for by the province while the charge for dispensing fee is paid by the older adult. The maximum dispensing fee is $6. Individuals over 65 who receive Old Age Security and the Guaranteed Income Supplement are eligible for coverage. |
Prince Edward Island[36] |
In Prince Edward Island, at the age of 65, all older adults are automatically enrolled in the province’s pharmacare program that only requires them to pay the first $8.25 of the cost of their prescription medication plus $7.69 of the pharmacy professional fee. |
Yukon[37] |
Yukon residents at least 65 years of age or aged 60 and married to a Yukon resident who is at least 65 years of age, are eligible for Yukon Pharmacare benefits through the Yukon Health Care Insurance Plan (YHCIP). The Yukon Pharmacare program pays the total costs of the lowest priced generics of all prescription drugs listed in the Yukon Pharmacare Formulary, including the dispensing fee. |
Northwest Territories[38] |
Residents of the Northwest Territories (NWT) aged 60 or over are provided pharmacare coverage through Alberta Blue Cross which administers benefits for older adults on behalf of the NWT government.
This program provides older adults with 100% coverage for eligible prescription drug products as defined in Health Canada’s Non-Insured Health Benefit (NIHB) Drug Benefit List, when the drug is prescribed by a recognized health care professional and dispensed by a licensed pharmacist. |
Nunavut[39] |
All individuals over 65 are eligible to apply for the Nunavut Seniors’ Coverage Plan under the Extended Health Benefits Full Coverage Plan (EHB). The EHB pays the full costs of approved prescription drugs. |
Evidence-Informed Policy Options
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Improve Access to Medically Necessary Medications for Older Canadians
Older Canadians should never have to make choices about taking necessary prescription medications based on their ability to pay. With the evidence clearly demonstrating a negative relationship between co-payments and deductibles to overall medication adherence, the federal government should provide leadership in partnership with its provincial and territorial counterparts to ensure that that older Canadians, or at least low-income older Canadians as a start, do not need to pay out-of-pocket for their necessary medications.
The federal government’s recently announced commitment to national formulary – a common list of drugs at a common price – and a national agency to coordinate efforts amongst the provinces and territories should enable this overall agenda.[40] Indeed, savings that could be achieved through a national prescription medication purchasing program – and avoidable health care costs related to prescription medication non-adherence – could more than offset the costs related to eliminating current out-of-pocket payments within provincial and territorial plans.[41]
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Ensure Appropriate Prescribing of Necessary Medications for Older Canadians
Older Canadians should not be prescribed medications that are known to be potentially harmful to their health, when safer alternatives exist. The federal government should provide leadership in partnership with its provincial and territorial counterparts to address this issue in two ways. First, the creation of standardized and evidence-based prescribing policies around common provincial and territorial formulary medications could influence overall prescribing practices. Second, ensuring that national curriculum guidelines for both entry-to-practice and currently practicing health care professionals, such as doctors, nurses and pharmacists who prescribe and dispense prescription medications are strengthened to include comprehensive training in medically appropriate and inappropriate prescribing, as well as the related principles on de-prescribing medications for older adults. With the availability of more evidence-based prescribing information and training, health care professionals across Canada will be able to contribute to better patient and system outcomes.
References
[1] Statistics Canada (2016). Research Highlights on Health and Aging Available at: https://www150.statcan.gc.ca/n1/pub/11-631-x/11-631-x2016001-eng.htm
[2] Canadian Institute for Health Information. (2016). Drug Use Among Seniors in Canada, Ottawa, ON: CIHI; 2018. Available at: https://www.cihi.ca/sites/default/files/document/drug-use-among-seniors-2016-en-web.pdf
[3] Government of Canada (2019). A Prescription for Canada: Achieving Pharmacare for All, from https://www.canada.ca/en/health-canada/corporate/about-health-canada/public-engagement/external-advisory-bodies/implementation-national-pharmacare/final-report.html
[4] Canadian Institute for Health Information. (2019). Prescribed Drug Spending in Canada 2019: A Focus on Public Drug Programs. Available at: https://www.cihi.ca/sites/default/files/document/pdex-report-2019-en-web.pdf
[5] Government of Canada. (2018, November 11). Advisory Council on the Implementation of National Pharmacare. Retrieved January 20, 2019, from https://www.canada.ca/en/health-canada/corporate/about-health-canada/public-engagement/external-advisory-bodies/implementation-national-pharmacare.html#2
[6] Government of Canada (2019). A Prescription for Canada: Achieving Pharmacare for All, from https://www.canada.ca/en/health-canada/corporate/about-health-canada/public-engagement/external-advisory-bodies/implementation-national-pharmacare/final-report.html
[7] Government of Canada. (2019). Budget 2019: Investing in the Middle Class. Retrieved April 14, 2019, from https://www.budget.gc.ca/2019/docs/plan/budget-2019-en.pdf
[8] Harris, Stergachis & Ried. (1990). The effect of drug co-payments on utilization and cost of pharmaceuticals in a health maintenance organization. Medical Care, 28(10), pp. 907-17.
[9] Gibson et al. (2006) Impact of statin copayments on adherence and medical care utilization and expenditures. The American Journal of Managed Care, 12 Spec no.: SP11-9.
[10] Choudhry et al. (2010). At Pitney Bowes, value-based insurance design cut copayments and increased drug adherence. Health Affairs, 29(11), pp. 1995-2001.
[11] Chernew et al. (2008). Impact of decreasing copayments on medication adherence within a disease management environment. Health Affairs, 27(1), pp. 103-112.
[12] MacLaughlin, E. J. et al. (2005). Assessing medication adherence in the elderly: Which tools to use in clinical practice? Drugs and Aging, 22(3), pp. 231-55. Available at: http://www.dhcs.ca.gov/services/ltc/Documents/Medication%20Noncompliance%20Research%20-%20Highlighted%20Studies%20B.pdf
[13] MacLaughlin, E. J. et al. (2005). Assessing medication adherence in the elderly: Which tools to use in clinical practice? Drugs and Aging, 22(3), pp. 231-55. Available at: http://www.dhcs.ca.gov/services/ltc/Documents/Medication%20Noncompliance%20Research%20-%20Highlighted%20Studies%20B.pdf
[14] NHS. (2015). Help with health costs. Available at: http://www.nhs.uk/nhsengland/healthcosts/pages/prescriptioncosts.aspx.
[15] Canadian Institute for Health Information. (2019). Prescribed Drug Spending in Canada 2019: A Focus on Public Drug Programs. Available at: https://www.cihi.ca/sites/default/files/document/pdex-report-2019-en-web.pdf
[16] Government of Canada. (2018, June 22). Prescription drug pricing and costs. Retrieved January 20, 2019, from https://www.canada.ca/en/health-canada/services/health-care-system/pharmaceuticals/costs-prices.html
[17] Government of Canada. (2018, June 22). Prescription drug pricing and costs. Retrieved January 20, 2019, from https://www.canada.ca/en/health-canada/services/health-care-system/pharmaceuticals/costs-prices.html
[18] Morgan, Law, Daw, Abraham & Martin (2015). Estimated cost of universal public coverage of prescription drugs in Canada. CMAJ, doi: 10.1503/cmaj.141564.
[19] Sehgal et al. (2013). Polypharmacy and potentially inappropriate medication use as the precipitating factor in readmission to hospital. J Family Med Prim Care, 2(2) Apr-Jun: 194–199. Available at: http://www.ncbi.nlm.nih. gov/pmc/articles/PMC3894035/.
[20] Sehgal et al. (2013). Polypharmacy and potentially inappropriate medication use as the precipitating factor in readmission to hospital. J Family Med Prim Care, 2(2) Apr-Jun: 194–199. Available at: http://www.ncbi.nlm.nih.
[21] Canadian Institute for Health Information. Drug Use Among Seniors in Canada, 2016. Ottawa, ON: CIHI; 2018. Available at: https://www.cihi.ca/sites/default/files/document/drug-use-among-seniors-2016-en-web.pdf
[22] Lemay & Dalziel. (2012). Better prescribing in the elderly. CGS Journal of the CME, 2(3), pp. 20-26. Available at: http://www.canadiangeriatrics.ca/default/index.cfm/linkservid/86F27E6A-B4AE-C03B-7BC1839EF84D70A1/showMeta/0/
[23] Tannenbaum, C. (2013). First do no harm: Reducing morbidity and mortality from polypharmacy in modern medicine. [Presentation] Available at: http://www.medicine.med.ualberta.ca/en/~/media/deptmed/Presentations/2013-05-31-MGR.pdf
[24] Tannenbaum, C. (2013). First do no harm: Reducing morbidity and mortality from polypharmacy in modern medicine. [Presentation] Available at: http://www.medicine.med.ualberta.ca/en/~/media/deptmed/Presentations/2013-05-31-MGR.pdf
[25] Government of British Columbia. (2015). PharmaCare for B.C. Residents. Available at: http://www2.gov.bc.ca/gov/content/health/health-drug-coverage/pharmacare-for-bc-residents
[26] Government of British Columbia (2019). Fair PharmaCare Changes in 2019. Available at: https://www2.gov.bc.ca/gov/content/health/health-drug-coverage/pharmacare-for-bc-residents/who-we-cover/fair-pharmacare-plan/fair-pharmacare-changes-in-2019#FairPharmaCareChanges
[27] Government of Alberta. (2019). Coverage for Seniors benefit. Retrieved February 6, 2019, from http://www.health.alberta.ca/services/drugs-seniors.html
[28] Government of Saskatchewan. (2018, March). Seniors’ Drug Plan. Retrieved January 20, 2019, from https://www.saskatchewan.ca/residents/health/accessing-health-care-services/seniors-drug-plan
[29] Government of Saskatchewan. (2016 -2017). Ministry of Health Drug Plan and Extended Benefits Branch. Retrieved January 20, 2019, from http://formulary.drugplan.health.gov.sk.ca/Publns/2016-2017_Annual_Report.pdf
[30] Government of Manitoba. (2015). Manitoba Pharmacare Program: General pharmacare questions. Available at: http://www.gov.mb.ca/health/pharmacare/general.html.
[31] Government of Ontario. (2019, January 21). Get coverage for prescription drugs. Retrieved January 21, 2019, from https://www.ontario.ca/page/get-coverage-prescription-drugs#section-0
[32] Government of Quebec. (2019). Prescription drug insurance. Available at: http://www.ramq.gouv.qc.ca/en/citizens/prescription-drug-insurance/Pages/annual-premium.aspx
[33] Government of New Brunswick. (2018, December). Turning 65? You can receive Drug and Health Coverage. Retrieved January 20, 2019, from https://www2.gnb.ca/content/dam/gnb/Departments/h-s/pdf/en/NBDrugPlan/SeniorsKit.pdf
[34]Government of Nova Scotia. (2018, April 1). Nova Scotia Seniors’ Pharmacare Programs. Retrieved January 20, 2019, from https://novascotia.ca/dhw/pharmacare/documents/seniors-pharmacare-program-booklet.pdf
[35] Government of Newfoundland and Labrador. (2015). Prescription drug program: Plan overview. Available at: http://www.health.gov.nl.ca/health/prescription/nlpdp_plan_overview.html.
[36] Government of Prince Edward Island. (2019). Seniors’ Drug Program. Retrieved January 21, 2019, from https://www.princeedwardisland.ca/en/information/sante-i-p-e/seniors-drug-program
[37] Yukon Health and Social Services. (2015). Pharmacare. Available at: http://www.hss.gov.yk.ca/pharmacare.php
[38] Northwest Territories Health and Social Services. (2019). Extended health benefits seniors’ program. Available at: http://www.hss.gov.nt.ca/health/nwt-health-care-plan/extended-health-benefits-seniors-program
[39] Nunavut Department of Health. (2015). Seniors full coverage plan. Available at: http://gov.nu.ca/health/information/seniors-full-coverage-plan.
[40] Government of Canada. (2019). Budget 2019: Investing in the Middle Class. Retrieved April 14, 2019, from https://www.budget.gc.ca/2019/docs/plan/budget-2019-en.pdf
[41] Government of Canada. (2019). A Prescription for Canada: Achieving Pharmacare for All, from https://www.canada.ca/en/health-canada/corporate/about-health-canada/public-engagement/external-advisory-bodies/implementation-national-pharmacare/final-report.html