Hon. Judith G. Seidman: Honourable senators, I will continue to address some of the issues that confront us in this plan and the possible unintended consequences.

The fourth issue I bring to your attention is the national universal pharmacare policy contemplated by Bill C-64. It has no mechanism for exceptions to be made to allow a patient to access a drug that is not on the formulary.

This concern was raised at the House of Commons Standing Committee on Health by John Adams, Chair of the Board of Directors of the Best Medicines Coalition. The Best Medicines Coalition represents 30 patient organizations from Parkinson’s, arthritis, hemophilia and blindness to cancers and other complicated and rare diseases.

He told the House of Commons Health Committee:

. . . not every patient responds in the same way to the same drug. We need some variety and some choice. Quebec has a mechanism where a doctor can apply to a truly independent scientific review committee that is outside of the health bureaucracy for a drug that the doctor knows the patient needs . . . .

It would be a great improvement for national pharmacare, as a concept, to always have that safety valve for the exceptional patient.

Committee hearings should examine the merits and potential mechanisms for exceptions to the formulary.

Fifth, costs for a national universal pharmacare program, as outlined in the principles of Bill C-64, could balloon.

In its report on Bill C-64, published on May 15, the Office of the Parliamentary Budget Officer:

. . . assumes that any medications that are currently covered by provincial and territorial governments, as well as private insurance providers will remain covered on the same terms.

They state, and the language is really important, “. . . The aim of the program is to expand and enhance, rather than replace . . . .”

This assumption informed the PBO’s estimate that universal national pharmacare will increase federal program spending by $1.9 billion over five years.

In my briefing with department officials, I was assured that the government, in its bilateral agreements with the provinces, will negotiate to ensure that the provinces maintain their own current public plan coverage for diabetes and contraception. However, there is no way for the federal government to guarantee that private drug plans will maintain their coverage.

If private drug plans were to cease providing coverage for diabetes and contraception drugs and devices, according to the PBO public program spending would more than double. Instead of costing $1.9 billion over five years, the program would be projected to cost $4.4 billion over five years.

Honourable senators, aside from the stated “universality” principles, the actual propositions in Bill C-64 oblige the Minister of Health to make payments to provinces and territories with which the federal government has made bilateral agreements to provide coverage for specific prescription drugs and related products intended for contraception or the treatment of diabetes.

Clause 6(1) of the bill specifies that the payments are intended to “. . . increase any existing public pharmacare coverage . . . .” The wording of this clause informed the assumptions made in the PBO’s report on Bill C-64.

The wording of clause 6(1) seems to indicate that the coverage for specific prescription drugs and related products intended for contraception or the treatment of diabetes would fill gaps in existing coverage.

This seems to contradict other clauses in the bill. Is it confusing? Indeed it is. As Stephen Frank, the President and Chief Executive Officer of the Canadian Life and Health Insurance Association, told the House of Commons Health Committee:

. . . in Canada there are 27 million Canadians with private drug coverage. It’s very broad coverage, much broader even than that of the best public system available across Canada, and they value that coverage greatly—90% of them value their coverage to a high amount or to a great amount—so they want to protect it and they are very strongly opposed to having it put at risk. Overwhelmingly, if you ask them what their preferred approach is and you give them a choice, they would like government to target their efforts to where the need is.

Colleagues, should we displace the existing coverage that 90% of Canadians value?

Confusion remains regarding how private insurance and this new public plan would be coordinated at the pharmacy counter. If a patient has existing private coverage for 80% of the cost of a medication, will the public plan cover the remaining 20%? Or will 100% of the cost shift to the public plan, thereby shifting costs from the private insurer to taxpayers?

In my briefing with department officials, when asked, they replied that these “back office” details had not yet been worked through. In its study, committee hearings should pursue answers to these foundational questions.

Coverage for specific prescription drugs and related products intended for contraception or the treatment of diabetes will not be administered centrally by the federal government, unlike the new dental benefit. Instead, the new coverage will be administered by the provinces and territories in accordance with forthcoming bilateral agreements.

Bilateral agreements entail myriad challenges. For instance, in March 2023, the government announced an investment, as I already said, of up to $1.5 billion over three years in support of the National Strategy for Drugs for Rare Diseases, which is supposedly part of this plan. This is meant to help increase access to, and affordability of, promising and effective drugs for rare diseases.

It has been more than one year, and those bilateral agreements have not been signed and, as a result, that money has yet to help Canadians with rare diseases.

Dr. Durhane Wong-Rieger, the President and Chief Executive Officer of the Canadian Organization for Rare Disorders, or CORD, told the House of Commons Health Committee:

. . . we’ve seen that the majority of that money, $1.4 billion out of $1.5 billion, is to be allocated through bilateral agreements. . . .

What we know is that, well over a year later, none of these agreements have been put in place. We don’t even know if there have been discussions around them. Whether it’s just bureaucracy, whether it’s just the cumbersome nature of the process, whether it’s really hard to get provinces to agree, I don’t know. However, this is not the way it’s needed to be.

Dr. Wong-Rieger wondered whether other medications would suffer the same tardiness in rollout as the drugs for rare diseases. Committee hearings would benefit from CORD’s lessons learned.

We have heard over the years how very difficult it is for the federal government to get comprehensive and comparable data from the provinces, even if data reporting is a requirement of a bilateral agreement.

For example, late last year when the Social Affairs Committee was studying Bill C-35, An Act respecting early learning and child care in Canada, we heard from Gordon Cleveland, who is the chair of the National Advisory Council on Early Learning and Child Care’s Data Indicators and Research Working Group. He told us:

. . . . the trouble is that the provinces and territories, in many cases — either haven’t been able to —

— improve data collection —

— or it’s not high enough of a priority. They are not reporting in the way the agreements foresaw. They’re not providing information in as timely a way as we thought they would, and even when they do, there will be major problems of lack of comparability.

If, as the minister has indicated, coverage for specific prescription drugs and related products intended for contraception or the treatment of diabetes is to be a pilot project for more universal coverage, then we will need excellent data for evaluation purposes. Colleagues, committee hearings should consider whether bilateral agreements can facilitate such data collection by including data-specific requirements.

The Government of Canada will be launching discussions with provinces and territories based on the list of diabetes drugs attached to a backgrounder published on Health Canada’s website on February 29, 2024. In that backgrounder, the government also announced its intention to establish a fund to enable work with provincial and territorial partners to support Canadians’ access to supplies that diabetics require to manage and monitor their condition and administer their medication, such as syringes and glucose test strips.

Many stakeholders have weighed in on the list provided in the backgrounder. The Association québécoise des pharmaciens propriétaires noted:

If you compare Quebec’s formulary to the one being proposed, even though it’s not final, you can see that several millions of diabetes-related prescriptions would be lost. . . . we manage stock shortages every day in community pharmacies. . . . We really need to ensure that this formulary at least covers Quebec’s formulary, even though the Quebec one is generous.

Broad coverage is needed for diabetes. . . . This wide range of covered drugs is essential in maintaining the health of Canadians.

Furthermore, the proposed fund for medical supplies for diabetics is, at this point, no more than a commitment. It is not included in Bill C-64. Mike Bleskie, an advocate with Type 1 diabetes, told the House of Commons Health Committee that his out-of-pocket costs stand at about $450 per month, mostly from his continuous glucose monitor, which is not covered in Ontario, and his insulin pump supplies. Bill C-64 would not help diabetics with those expenses.

Committee hearings should include the potential consequences of such a limited formulary and should study the formularies of different jurisdictions, both within Canada and internationally.

Colleagues, there are three other overarching problems with Bill C-64 that should be examined at committee. The first is the lack of oversight of the newly created Canadian Drug Agency, or CDA.

Bill C-64 envisions a broad and important role for the Canadian Drug Agency. Part 7 of Bill C-64 explains that the CDA will advise the minister on the clinical effectiveness and cost effectiveness of prescription drugs and related products compared to other treatment options; the prescription drugs and related products that should be included in prescription drug coverage plans in Canada and the conditions of that coverage; the collection and analysis of data on prescription drugs and related products; information and recommendations to be provided to health care practitioners and patients on the appropriate use of prescription drugs and related products; and improvements to be made to the pharmaceutical system, including through greater coordination between health system partners, patients and other stakeholders. It’s a big list.

The Canadian Drug Agency, or CDA, will prepare the national formulary that will inform the Minister of Health’s discussions with the provinces, territories, Indigenous peoples and other partners and stakeholders regarding national universal pharmacare. The CDA will also develop a national bulk purchasing strategy for prescription drugs and related products.

The problem, honourable senators, is that the Canadian Drug Agency was established at the direction of the Minister of Health, not by legislation. Serious questions should be asked as to whether, instead, the CDA should be subject to parliamentary oversight, the Access to Information Act, Auditor General scrutiny and interventions by a patient ombudsperson.

In his testimony at Standing Committee on Health, or HESA, John Adams of Best Medicines Coalition elaborated:

This bill gives the minister substantial new powers. It could be improved by building in various forms of transparency and accountability . . . .

. . . I think it defers too much to the black box called the Canadian drug agency and doesn’t put transparency or accountability mechanisms around what could become a very important role in system reform. . . .

The second overarching problem is that although the CDA will advise the minister on the creation of the national formulary, decisions regarding which drugs will be included will ultimately be made by the minister. This is an extraordinary power.

In her testimony before HESA, Linda Silas, the President of the Canadian Federation of Nurses Unions, said:

. . . when I met the minister yesterday, I said that it wasn’t really up to him to decide what was on the formulary, which diabetic drug, and that a group of experts should deal with it. . . .

Committee hearings should consider whether it is appropriate for the minister on the advice of an agency that is not overseen by Parliament — to decide what drugs and devices will be listed on the national formulary.

The third overarching problem with Bill C-64 is its lack of definitions. This concern was raised by many members of Parliament and stakeholders during HESA’s study.

Clause 6(1) of the bill tasks the minister with making payments to provinces or territories:

. . . in order to increase any existing public pharmacare coverage — and to provide universal, single-payer, first-dollar coverage — for specific prescription drugs and related products intended for contraception or the treatment of diabetes.

But the bill does not define “universal,” “single-payer” or “first dollar.” This has led to unnecessary confusion. Committee hearings should include the consideration of amendments to the bill to introduce definitions.

According to the Canada Health Act:

In order to satisfy the criterion respecting universality, the health care insurance plan of a province must entitle one hundred per cent of the insured persons of the province to the insured health services provided for by the plan on uniform terms and conditions.

This is how Canadians have understood the term “universal” since 1985.

Although Canadians may have an intuition as to what “single-payer” means, the term must be defined. As a 2017 article in the Journal of General Internal Medicine notes:

Single-payer systems are heterogeneous. Acknowledgment of what is considered as single-payer and the characteristics that are variable is important for nuanced policy discussions on specific reform proposals.

The government should be asked to provide a precise definition of “single-payer” so that the term can be defined in Bill C-64.

The term “first dollar” has also caused confusion. At HESA, Michelle Boudreau, the Associate Assistant Deputy Minister in the Strategic Policy Branch of Health Canada, explained that:

. . . “First dollar” means that as soon as an insurable event occurs — in this case, having a prescription filled — the insurance would apply: That is, the coverage would apply before any other payments.

Similarly, the Canadian Medical Association defines “first dollar coverage” as, “Health services covered 100% by public insurance, with no charges to patients seeking care.” This would seem to indicate that there will not be coordination of benefits when a patient has private insurance.

If public coverage will apply before private coverage, the government has underfunded its program:

Budget 2024 proposes to provide $1.5 billion over five years, starting in 2024-25, to Health Canada to support the launch of the National Pharmacare Plan.

The Parliamentary Budget Officer, or PBO, meanwhile:

. . . estimates that the first phase of national universal pharmacare will increase federal program spending by $1.9 billion over five years. . . .

We must remember, however, that the PBO’s estimate:

. . . assumes that any medications that are currently covered by provincial and territorial governments, as well as private insurance providers will remain covered on the same terms.

If medications for contraception and diabetes that are currently covered by private insurance providers are instead covered by the public plan, the PBO estimates that this phase of pharmacare will cost $4.4 billion. There would therefore be a $2.9 billion dollar budget shortfall.

The government must explain what precisely is meant by “first dollar,” and the committee should consider amending the bill to include this definition.

The Hoskins report says:

. . . Canada is the only country in the world with universal health care that does not provide universal coverage for prescription drugs. . . .

However, colleagues, universal coverage need not mean single-payer coverage. We can endorse universal coverage without endorsing a system funded exclusively by the federal government.

In conclusion, honourable senators, when Bill C-64 is sent to committee, there is much to consider — even as for the very essence of what is being proposed in this legislation. Is it indeed a universal system, as we understand the concept, or is it a fill-in-the-gap system? There seems to be confusion even about these very principles.

Colleagues, Canadians are counting on us.

Thank you for your attention. I look forward to study at committee.