Canada among top pharmaceutical spenders on OECD list

Posted on in Health Delivery System

TheGlobeandMail.com – News/National
Nov. 04, 2015.   Elizabeth Church

Canadian spending on drugs continues to top that of most industrialized countries, with one-third of the dollars spent on pharmaceuticals paid for out-of-pocket, according to a new report on international health trends.

The study from the Organization for Economic Co-operation and Development ranks Canada as the fourth-highest spender on pharmaceuticals among 29 countries when measured by population. Pharmaceutical spending in Canada worked out to $713 (U.S.) a person in 2013, well above the OECD average of $515. The highest spender by far was the United States at $1,026, followed by Japan and Greece. Drug costs were lowest in Denmark at $240 a person.

Canada also has one of the lowest percentages of public coverage for pharmaceutical costs, the study found. Government plans covered 36 per cent of costs, with the remainder coming from private insurance plans (30 per cent) and individuals’ own pockets (34 per cent). Only the United States and Poland had a lower percentage of drug costs paid for by public programs.

The new numbers come as pressure is mounting to expand public coverage of prescription drugs in Canada and to address problems with access created by price. It also comes as news of dramatic price hikes by companies that buy up drug rights has prompted threats of a crackdown by U.S. legislators.

In Canada, as many as one in 10 seniors skips buying medications because they can’t afford them, according to a Conference Board of Canada study released this fall, sponsored by the Canadian Medical Association. The CMA has called for catastrophic coverage for prescription drugs that would kick in for those households that spend more than $1,500 a year, or 3 per cent of their income, on prescription medications. Other groups have called for a national pharmacare plan, although only the Green Party made it part of its platform in the recent federal election.

Who is covered by public drug plans in Canada varies from province to province. The incoming Liberal government has pledged to improve access to prescription medications, and to work with provincial and territorial governments to buy drugs in bulk as a way to make them more affordable.

Gaétan Lafortune, a senior economist with the OECD health division in Paris, said the high rate of spending on pharmaceuticals in Canada appears to be linked to pricing, rather than consumption rates, which tend to be close to the OECD average.

As well, he pointed out that because the figures provided by Greece include other costs, it may be more accurate to put Canada in the third-highest spot for drug spending.

The low level of public drug coverage in Canada, he said, is in contrast to the county’s full coverage of doctor and hospital services, something for which many other OECD countries require residents to make a co-payment.

“There is always a trade-off,” Mr. Lafortune said. “Cover 100 per cent of fewer things or a broader range of services at less than 100 per cent.”

The high cost of certain drugs has made headlines recently, but the OECD study finds price increases have slowed in recent years. That’s partly because of the efforts of governments to constrain costs, Mr. Lafortune said, and also because several widely used drugs have come off patent.

He predicted that trend will change as more expensive treatments come to market and the percentage of seniors in the population increases.

The Health at a Glance study is released every two years and provides a report card on a range of measures that compare population health and the performance of health systems in OECD countries. Through a combination of measures, it attempts to rank access and quality of care, as well as health status and health-care resources.

This year, as in the past, Canada performs in the middle of the range on most measures, although there are some notable exceptions.

Smoking rates in Canada continue to be among the lowest in OECD countries, although obesity rates in children and adults are higher.

While Canada scores well on many measures of quality of care, Mr. Lafortune noted that it lags other countries in others, such as treatment of strokes.

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One Response to “Canada among top pharmaceutical spenders on OECD list”

  1. As Canadians we tend to boast about our healthcare system, but we never analyze it to see the amount of flaws there is compared to other countries, for example we are the only developed country that does not have universal prescription coverage. With that I agree with this article, as I am one of those statistics that cannot afford their medications due to the pricing and lack of coverage given by the Government. Also have seen the financial burden that comes along with serious illness, since within the ten years my sister was sick, my parents spent approximately $48,000 on prescriptions. In addition, there has been a rise in hospital visits that could be reduced by implementing universal prescription coverage as people like me would be able to take the preventive measures to keep them out of the hospitals. Although there is constant talk about this issue, the government needs to put their words into action as we see the amount of people needing prescriptions rising and instead ending up in the hospital.

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