Canada’s publicly funded universal Medicare system is often a source of national pride. Most Canadian healthcare services are publicly funded. There is no universal publicly funded prescription drug plan in Canada.
Pursuant to the Canada Health Act, all drugs administered in hospitals are fully funded by the Medicare system. Public outpatient drug coverage is offered at both federal and provincial or territorial levels.
At the Federal level, various drug plans available to certain regulated groups: veterans, native Canadians, Royal Canadian Mounted Police and members of the armed forces. Meanwhile, all provinces and territories have implemented publicly funded drug plans for specific subpopulations.
Provincial and territorial plans focus on containing costs and offering benefits primarily to individuals over the age of 65, individuals receiving social assistance or disability benefits and individuals with catastrophic drug needs (defined as high drug cost in relation to income).
Given the absence of a national insurance plan for outpatient prescription drugs, many employers provide private drug insurance for employees and their dependants.
The federal government reviews the safety and efficacy of drugs and approves them for sale through Health Canada’s Therapeutic Products Directorate. It also monitors the safety of drugs on the market. Manufacturers can begin to sell new drugs as soon as they receive marketing approval, known as a “Notice of Compliance” (NOC) or “Notice of Compliance with Conditions.”
After a new drug receives marketing approval, decisions are made about public funding. Under the terms of the Canada Health Act, all drugs administered in hospitals are fully funded by the public health care system for all Canadians with no co-payments. Hospital Pharmacy and Therapeutics Committees make decisions about which new drugs should be added to their formularies. Global hospital budgets are set by the provincial governments through their Ministries of Health.
Each province defines which new and generic drugs are eligible and the conditions for reimbursement, as provincial governments determine drug plan budgets.
Moreover, each province has its own drug plan formulary, which lists drugs that are reimbursed by the public plan. Usually hospital-only drugs (such as IV cancer drugs) are not included. Formularies also set reimbursement levels (e.g. criteria for reimbursement).
Source: S BONNER – Ogilvy Renault LLP
JILL M DALEY – Ogilvy Renault LLP