Pharmacare Bill
Second Reading--Debate Continued
June 11, 2024
Honourable senators, I would like to begin by recognizing that we are gathered on the traditional and unceded territory of the Algonquin Anishinaabe people, who have lived on this land since time immemorial.
I rise today to support the principle of Bill C-64.
My speech today will have three parts: first, a short background on the Canada Health Act and how that framework relates to the current gap of national pharmacare in Canada; then an outline of how access to contraception improves health; and finally, I will touch on a few areas of Bill C-64 where I believe further scrutiny is required.
To start, it is important to understand the Canada Health Act in relation to this piece of legislation. Bill C-64 states that the minister is to consider the Canada Health Act along with the principles of accessibility, affordability, appropriate use and universal coverage when collaborating with provinces, territories, Indigenous peoples and other partners and stakeholders toward national universal pharmacare.
Consideration of a national prescription drug plan is not new. In 1961, the Royal Commission on Health Services, also known as the Hall commission, recommended a national health policy and a comprehensive health care program, thus laying the foundation for the Canada Health Act. One recommendation from the Hall commission was that prescription drugs be included as a benefit of the proposed health system.
Fast-forward to 1984 and the enactment of the Canada Health Act, which established the funding framework from the federal government to the provinces and territories, as well as the principle of single-payer health care. It also set out the criteria and conditions that the provinces and territories must fulfill to receive their full federal cash contribution available under the Canada Health Transfer. Keep that phrase in mind — “criteria and conditions” — as I will elaborate later.
Under the Canada Health Act, insured health services include medically necessary hospital, physician and certain surgical-dental services, but not prescription drugs, hence the gap that Bill C-64 is attempting to fill. Some of you are likely familiar with the 2019 report of the Advisory Council on the Implementation of National Pharmacare, better known as the Hoskins report. It emphasizes that:
We are the only country in the world with universal health care that does not provide universal coverage for prescription drugs.
While the latter half of that statement is true in that Canada does not have universal coverage for prescription drugs, it is important to note that Canada does not have a universal health care system.
And this is from the Government of Canada website:
Canada does not have a single national health insurance plan. Rather, the 13 provinces and territories have their own health insurance plans, which share certain common features and basic standards of coverage defined by the Canada Health Act . . . .
Furthermore, alongside the 13 provincial and territorial health insurance plans, the federal government provides funding and some direct health care services to certain population groups, including First Nations people living on reserves, Inuit, serving members of the Canadian Forces, eligible veterans, inmates in federal penitentiaries and some groups of refugee claimants. Again, keep those groups in mind.
Now, moving on to the second part of my speech on how access to contraception improves health. Contraception saves the lives of women and babies by reducing both maternal mortality and infant mortality.
To start, contraceptive use reduces the number of abortions, especially those that are unsafe and lead to maternal deaths. Nearly one quarter of Canadians are of reproductive age, and nearly half of all pregnancies in Canada are unintended. Seventy per cent of people seeking abortions report no insurance coverage for contraception.
Although many Canadians have some form of insurance coverage, incomplete coverage impacts access. Requiring insurance companies to cover a 12-month supply of a contraceptive prescription has been associated with a 30% reduction of unintended pregnancies.
Additionally, data from the United States shows that even small out-of-pocket costs reduce the use of contraceptive services and medication, especially among low-income and uninsured women.
Family planning has contributed to substantial declines in global maternal and infant mortality. The ability to plan and time pregnancies provides health benefits for both mothers and babies.
Several studies show that both maternal and infant mortality risks increase with short birth intervals. For instance, beginning a pregnancy within six months of a live birth is associated with an increased risk of premature birth and low birth weight for the newborn.
Family planning reduces maternal mortality by reducing parity — that means the number of births — which then decreases the number of times a woman faces the morbidity and mortality risks associated with childbirth.
Finally, a few words on the economic benefits of contraception. A report by the Institute for Women’s Policy Research lists the economic effects of contraceptive access. The report is based on research that identifies causal impacts on educational attainment, labour force participation, career outcomes, earnings, poverty and effects on the next generation.
In the 1960s, expanded contraceptive access for women led to increased women’s college enrollment by an estimated 12 to 20%. Access to the birth control pill allowed women to delay childbirth, boosting their investment in education and careers.
Contraceptive access accounted for 15% of the increases in women’s labour force participation and nearly one third of the rise in women entering professional fields like medicine and law from 1970 to 1990.
Now, moving on to the third part of my speech, allow me to highlight two reasons why I look forward to studying this bill in committee.
First, the projected cost and lack of a compliance and enforcement mechanism in Bill C-64 should undergo further scrutiny. The Parliamentary Budget Officer has estimated that the first phase of national universal pharmacare will increase federal spending by $1.9 billion over five years. Yet, despite the almost $2 billion increase in federal spending, I find accountability lacking in Bill C-64 as it does not contain language on compliance and enforcement.
Recall earlier how the Canada Health Act sets out the criteria and conditions that the provinces and territories must fulfill to receive their full Canada Health Transfer. The Canada Health Act lists five criteria of public administration: comprehensiveness, universality, portability, accessibility and two conditions on information and recognition.
If the federal minister of health is of the opinion that a province or territory’s health care insurance plan does not meet one of the five criteria or does not meet the two conditions, the minister may refer the matter to the Governor-in-Council. If the Governor-in-Council agrees, they may direct that any cash contribution to that province or territory for a fiscal year be reduced or direct that the whole of any cash contribution to that province or territory for a fiscal year be withheld.
In short, if a province or territory does not fulfill the Canada Health Act’s criteria or conditions, the federal government may reduce or withhold their Canada Health Transfer.
Furthermore, the Canada Health Act provides that a provincial or territorial health care insurance plan must not permit extra billing or user charges by health facilities or health care practitioners. Amounts charged to patients in the form of either extra billing or user charges must be deducted from the cash contribution made under the Canada Health Transfer.
Bill C-64 aims to provide universal, single-payer, first-dollar coverage. Unlike the Canada Health Act, however, Bill C-64 does not contain language on compliance and enforcement.
I question how the provinces and territories will be held accountable. What recourse does the federal government have if a province or territory fails to uphold the principles set out in clause 4 of the bill? What will happen if patients continue to have upfront, out-of-pocket expenses like an insurance co-pay or a pharmacy dispensing fee?
One would assume that co-pays and dispensing fees will be included in the discussions held between the federal minister of health and provinces, territories, Indigenous peoples and other partners and stakeholders.
But as parliamentarians, we cannot make assumptions when it comes to passing legislation. This leads to the second reason I look forward to the committee study on this legislation — to gain more information from the minister and government officials on the future bilateral discussions.
As mentioned earlier, the federal government provides funding and some direct health care services to certain populations including First Nations people living on reserves, Inuit, serving members of the Canadian Armed Forces, eligible veterans, inmates in federal penitentiaries and some groups of refugee claimants.
Clause 5 of Bill C-64 outlines the funding commitment in which the Government of Canada commits to maintaining long‑term funding for the provinces, territories and Indigenous peoples, with funding for the provinces and territories provided primarily through agreements with their respective governments. But other than Indigenous peoples, Bill C-64 does not detail a commitment to long-term funding for the other federal populations. Perhaps these groups are the “other partners and stakeholders” referred to in clause 4, but coverage for federally funded populations should be further explored in committee.
To conclude, I support improving health through better access to affordable medications. But with Bill C-64 in its current form, questions remain. How will provinces and territories be held accountable for the federal funds transferred to them? What will the compliance and enforcement mechanisms be, especially if they are not entrenched in legislation? Will all federal populations have a commitment from the Government of Canada to improve access and affordability of prescription drugs and related products?
Honourable colleagues, I hope you join me in supporting Bill C-64.
Thank you. Meegwetch.
Honourable senators, I rise to speak to Bill C-64, An Act respecting pharmacare.
I want to thank Senator Pate for her work as sponsor of this bill and for the valuable overview of the topic and the bill she has given us.
My goal today will be to provide insights that I hope will be helpful as we continue to study this bill, especially when it comes to the Standing Committee on Social Affairs, Science and Technology.
Honourable colleagues, you will know that Canada is the only country in the world with universal health care that does not include coverage for prescription drugs. Senator Pate highlighted the ways in which pharmaceutical products have become a necessary part of health care. Yet, we have not evolved medicare to respond to the need to ensure that Canadians have the drugs they need.
Access to drugs that are effective is not a “nice-to-have.” Colleagues, let’s be clear: We should consider this a human right.
In Canada, a patchwork system has evolved through hundreds of thousands of private insurance plans and public plans over the past many decades. Insurance companies, industry and others will tell you that 97% of Canadians are covered by insurance plans. I would urge you, colleagues, to view those numbers with much skepticism.
The truth is that one in five Canadians is effectively uninsured, and there are a number of reasons why. Although some may have some insurance, the copays they are required to pay limit their access; the coverage they have is insufficient for a full year of prescriptions; or, as we heard is the case with contraceptives, drug coverage is impacted by a parent or other family member. This leads to cost-related non-adherence — or, to put it differently, the inability to take the drugs you need because you can’t afford to do so.
No Canadian should be faced with this challenge. No Canadian should have to choose between taking medicine for their heart disease and buying groceries for their family. The fact that millions of Canadians do face this challenge tells us that our large patchwork of private and public schemes is failing us.
Not only does this patchwork fail to provide access to drugs for many Canadians, it also provides inadequate access for those who do have some form of coverage. For example, someone in a management position will have better coverage than someone on the factory floor because, in our current setting, prescription drug coverage is sometimes treated as an employee benefit, rather than the provision of access to vital drugs.
Frankly, colleagues, the system that we have today is not meeting the needs of Canadians. All Canadians should have access to the drugs they need.
This patchwork system is not only failing to provide access to some and providing unequal access for others; it has also resulted in Canada spending far more on drugs than we should have to.
Colleagues, it may surprise you to learn that we spend more on drugs than countries like Australia, the United Kingdom and the Netherlands. In fact, according to the Canadian Institute for Health Information, or CIHI, drugs are the second most expensive part of our health care system, after hospitals. In 2023, almost 14% of health spending in Canada was on drugs. Public drug systems spent a total of $17.2 billion in 2022.
Why is this? A primary reason is that public-private mixed systems like those we see in the United States, Germany and Switzerland cost more.
Another reason is that insurance companies negotiate confidential reimbursements with manufacturers to recuperate funds when drugs are expensive, effectively de-incentivizing them from negotiating lower prices. Whatever the reason, it is clear that we are spending too much on the drugs that we can access, while many Canadians continue to have little or uneven access to the drugs they need.
Colleagues, the reality as I have described it has been the status quo in Canada for many years. How do we move forward from these issues and build a system where every Canadian can access the drugs they need?
I would refer to the first recommendation of the Hoskins report, which states:
The council recommends the federal government work with provincial and territorial governments to establish a universal, single-payer, public system of prescription drug coverage in Canada.
The council proposes the five fundamental principles of medicare, embodied in the Canada Health Act, be applied to national pharmacare
Universal: all residents of Canada should have equal access to a national pharmacare system;
Comprehensive: pharmacare should provide a broad range of safe, effective, evidence-based treatments;
Accessible: access to prescription drugs should be based on medical need, not ability to pay;
Portable: pharmacare benefits should be portable across provinces and territories when people travel or move; and
Public: a national pharmacare system should be publicly funded and administered.
Honourable senators, with Bill C-64, Canada is taking a step toward what the Hoskins report proposed. Nevertheless, I want to be clear that we should not proceed down the road of strengthening the patchwork model, as some have proposed. This would only lead to poorer and more uneven access at higher costs for Canadians. In fact, public systems stepping in to cover the cracks and pay for more expensive drugs amounts to expecting the public to take on a greater financial burden while private insurers continue to draw profits. Why should Canadians accept this approach?
I wish to draw from the example of the U.K. There, outpatient prescriptions come with a copay of about US$13, while hospital prescriptions are entirely free. There are also mechanisms to keep costs low for those who have a heavy burden of prescription, and many don’t have to pay at all, such as children, seniors and those with disabilities.
This system is a strong example of a universal, single-payer, publicly administered system and provides much greater overall value. In fact, in 2021, the U.K. system spent US$517 per capita, while the Canadian system spent US$865 per capita. This example demonstrates that including national pharmacare as part of our health care system can provide access to medicines while lowering overall costs.
Colleagues, this brings us to Bill C-64. In some senses, it is an underwhelming bill that leaves us with questions.
I would describe Bill C-64 as effectively doing several things. First, it provides the guidelines to build a national pharmacare system. This includes, for example, important conditions such as working with provinces, territories and Indigenous peoples; and considering principles such as accessibility, affordability and appropriate use. It also gives the minister authority to enter into agreements for “. . . related products intended for contraception or the treatment of diabetes . . .” and the responsibility to consult with the Canadian Drug Agency.
The minister is given many responsibilities in this bill, but it should be noted that the minister does not have to wait for the mandate given to him by Bill C-64 to begin discussions with key parties.
Second, Bill C-64 lays out certain key principles for pharmacare — namely, that it should be a universal, single-payer, first-dollar program.
Finally, Bill C-64 puts forward contraceptives and diabetes-related medication as the pilot project for pharmacare, the first items of what should become an expanding formulary.
Colleagues, this is promising in some respects, but I have many hesitations about whether this bill truly puts us on the road toward universal pharmacare.
The first is the significant ambiguity in the bill. It is not immediately clear whether Bill C-64 will lead to a truly single‑payer, publicly administered system or simply fill in the gaps so that “universal access” becomes an umbrella term incorporating both public and private plans.
The Parliamentary Budget Officer, in his March review of the bill, stated that:
The new program will cover 100% of the expense on diabetes and contraception medication for those who currently do not have public or private drug plan coverage and for those who currently do not fill their prescriptions due to cost related reasons. The latter group is assumed to be 14% of total prescriptions. The program will also cover the out-of-pocket portion of prescription costs for those who have public or private drug plan coverage.
Is this the case? Is the plan to fill in gaps or to provide universal coverage to all, regardless of whether they have an existing private plan?
The technical briefing held last week with government officials raised even more questions for me. It is not clear whether or not the government plans to bring in the needed overhaul, versus simply expanding what the provinces are already doing. The briefing has led me to question whether the government is, in fact, committed to a specific direction or whether it may choose to change course and apply different principles sometime down the road. This, for me, is very concerning. I look forward to asking the minister and his officials more questions at committee.
Building on this ambiguity, I would question the government’s commitment to public administration of pharmacare. Colleagues, I cannot overemphasize that public administration of pharmacare is an essential principle and is key to ensuring access to drugs for all Canadians.
Private insurers are not incentivized to work toward lower costs, minimize administrative fees or challenge manufacturers on the cost-effectiveness of drugs in the same way that public plans do.
To be clear, this is not to demonize private insurers by any means, but it is to highlight that as businesses, their interests are markedly different than the public’s interests.
Having said this, I strongly urge us to ensure public administration is and remains a keystone of pharmacare.
Honourable colleagues, I support universal pharmacare and the intentions of Bill C-64. I believe this bill should become law, but we have important work to do to make sure that the bill is as strong and as clear as it can be so that universal pharmacare can become reality.
I look forward to seeing this bill before the Social Affairs Committee, and I welcome senators interested in this bill who are not on the committee to join us so that together we can strengthen this bill for all Canadians. Thank you, meegwetch.
Would Senator Moodie take a question?
I want to thank both Senator Osler and Senator Moodie for their speeches. I won’t pretend for a moment to have the experience that both of you have in health care, but I am always concerned about the delivery of health care and the announcement of plans, the announcement of programs. And I’ll talk about the dental program for one moment. I have had a half dozen calls to my office in the last month from seniors who cannot participate in the program for lack of insurance or even from some who have some insurance, but that it is not covered by their insurance, and now we’re talking about a pharmacare program.
I want to know if you feel confident that Bill C-64 will give to vulnerable Canadians — seniors in many cases — the opportunity to participate in the pharmacare program because it sounds wonderful at the outset sometimes, but the reality of what happens down the line is concerning for me. I just want to know what you think about that. Thanks.
Thank you, Senator Manning. I think there is a lot of potential in Bill C-64. I think it can deliver on exactly what you speak about, but we have to be very clear in the language of the bill that there can be no exceptions taken, that in fact the approach is going to be a consistent one, in principle at least, across provinces.
The provinces will negotiate how they deliver their health care, so how they actually end up in terms of delivery is going to perhaps look differently, but I think that if we are strong with the bill —
Thank you. The time for debate has expired.
