Social Policy in Ontario

Instead, the seven-member council chaired by former Ontario health minister Eric Hoskins has added its considerable weight to a host of previous studies, all of which have called for the same solution — a national, public, universal program to provide all Canadians with the medical drugs they need.

That some kind of change is needed should be obvious. Prescription drugs are becoming an increasingly necessary part of health care. Yet Canadian medicare covers only drugs that are administered in hospitals. It does not cover the same drugs when taken at home.

To deal with this, Canada has developed a hodgepodge of private and public programs. Some people get drug benefits through their workplace. Others get benefits because they are over 65. Still others get benefits because they are poor.

Some who suffer rare diseases that require expensive medication get government help. Others don’t.

Even so, an estimated 20 per cent of Canadians have inadequate drug coverage or, indeed, no drug coverage at all.

More alarmingly, this hodgepodge is becoming increasingly expensive. In an era of precarious work, fewer get drug coverage through their employers. Those that do face cutbacks and rollbacks as bosses try to deal with rising costs.

Canadians already pay higher prices for brand-name drugs than do residents of almost all 36 nations that constitute the Organization for Economic Co-operation and Development. Only the Swiss and the Americans pay more per capita.

Politically, the easiest solution the advisory council could have suggested would have been a plan to fill the gaps — a scheme similar to the one used in Quebec, whereby government provides a backstop for those who don’t get coverage through work or existing public programs.

That’s the approach Andrew Scheer’s Conservatives favour. It’s also the approach that Liberal Finance Minister Bill Morneau, in a burst of candour, said last year that he preferred.

But as Hoskins and his council point out, attempts to fill the gaps will not solve the fundamental problem of cost. Only a so-called single-pay program will give Canadians the bargaining clout they need to negotiate lower prices from the world’s drug giants.

Which is why countries such as Australia, the United Kingdom and New Zealand already embrace universal pharmacare.

Politically, the tricky part of universal pharmacare is not cost, per se. In terms of cost overall, most experts agree that a universal, single-pay system would save money for Canadians.

The council estimates that these savings would amount to $5 billion a year when national pharmacare is fully implemented.

But a universal public program would also shift costs from individuals and employers to governments. The council estimates governments would pay $15.3 billion a year more when the plan is fully implemented.

In short, Canadians would pay more in taxes for universal drug coverage. But this tax increase would be more than compensated for by the out-of-pocket, administrative and cost savings associated with the move to public pharmacare.

In fact, the economics of pharmacare are rather like the economics of medicare itself — a shift from private to public spending that ultimately saves Canadians money.

In its report, the council hearkens back to medicare. There was the same debate then about whether the new public health insurance scheme should be universal or whether it should be designed to simply fill the gaps left by private insurers.

In the end, the universalists won. In 1966, a minority Liberal government backed by the New Democrats passed into law the bill creating Canadian medicare.

It was controversial at the time. But it proved to be the most popular move any federal government has ever made.

Thomas Walkom is a Toronto-based columnist covering politics.

https://www.thestar.com/opinion/star-columnists/2019/06/13/pharmacare-today-like-medicare-50-years-ago-makes-sense.html