Inconsistency in the Cost of and Accessibility to Prescription Medications Drugs

Canada’s health care system faces some daunting challenges. One of the crucial inconsistencies is the variation of access to prescription medications across the country.

Like all other health-care services and products, prescription medications have a monetary value and are subject to inflation and the effects of Canada’s changing demographics. Let us begin with the demographics. Recent data from Statistics Canada reveals that baby boomers (those born between 1946 and 1962) currently make up about
33 per cent of the Canadian population while seniors (those who are 65 years of age or older) account for 14 per cent of the population. However, as baby boomers continue to age, the number of seniors will increase by roughly
10 per cent and by 2036, about 25 per cent of all Canadians will be over the age of 65. But what will the shifting demographics mean for the high costs of prescription medication in Canada?

An aging population is likely to raise the costs of all health-care services and products for the following reasons. Canadians enjoying a longer old age will require more medical services and products. And, as a greater percentage of Canadians enter old age, the costs of those services and products (prescription medications included) will increase substantially because there will be a much smaller pool of working-age taxpayers to fund the Canadian health care system. In addition, prescription medications remain relatively expensive in Canada due to inflation.

Canadians are also saddled with inconsistent access to, and affordability of, prescription medications often because of simple geography. The price of the same prescription medication varies from one province to the next because each province is responsible for developing and implementing its own prescription medication program. What this means is that the price that the Canadian consumer pays out of pocket for a given prescription medication is not the same in any two provinces and the same medication can often cost a consumer substantially more money in one province than in another. Consumers in every province other than Quebec must pay for their prescription medication themselves or go through their private insurance provider. Quebec is the only province that currently offers blanket prescription drug coverage to all its citizens even if they do not have private health insurance.

Demographics come into the equation once again but this time to determine who gets access to prescription medication and at what cost. Low-income seniors and those depending on social assistance programs receive prescription medication regardless of their province of residence. However, at the other end of the spectrum, low-income individuals who do not rely on social assistance programs and who are not seniors can fall through the cracks. These individuals often must pay close to the full cost of prescription medication, unless they live in Quebec or their employer offers a private health insurance plan. In fact, there are also close to 3.5 million Canadians who lack any drug coverage at all.

Although the price of different prescription medications varies among the provinces and territories, it is important to remember that there are existing government mechanisms in place to monitor and compensate consumers for these price discrepancies. The most important of these is the Patent Medicine Prices Review Board (PMPRB) – a quasi-judicial body that “is responsible for regulating the prices that patentees charge – the factory-gate price – for prescription and non-prescription patented drugs sold in Canada, to wholesalers, hospitals or pharmacies, for human and veterinary use to ensure that they are not excessive.” And, if the PMPRB finds that “after a public hearing, a price is excessive in any market, it may order the patentee to reduce the price and take measures to offset any excess revenues it may have received.” However, it should be noted that the PMPRB cannot regulate the prices of generic drugs.

Nevertheless, the reasoning for the existing variable pricing of, and accessibility to, prescription medications in Canada stems from the Canada Health Act (CHA) which was signed into law in 1984. The CHA establishes the guidelines that the provinces and territories must follow to ensure that they receive their full allotment of federal money which they can then allocate within their own boundaries for the health care of their citizens. What this means is that the provinces and territories, and not the federal government, are responsible for the delivery of health-care services and products throughout the nation. But it is the lack of a national prescription drug coverage plan that plays a crucial role in the varying cost of prescription medications in Canada.

The high costs and inconsistencies of access to prescription medications should be at the top of the list when it comes to making the health-care system work better for all Canadians. However, since health-care delivery is constitutionally the prerogative of the provincial and territorial governments, any meaningful discussion or plan to correct these two deficiencies must occur at the provincial and territorial levels