Federal Framework for National Pharmacare

Summary#

This bill creates a federal framework for a national pharmacare program. It sets conditions that provincial public drug plans must meet to receive federal cash contributions. The conditions mirror the Canada Health Act principles: public administration, comprehensiveness, universality, portability, and accessibility. The bill also allows creation of an independent drug agency and a national list of insured drugs, set by regulation.

• Provinces that run a non‑profit, publicly administered drug plan meeting five criteria can receive federal funds (Bill ss. 5, 7‑11).
• Coverage must pay the full cost of listed (“insured”) prescription drugs and related dispensing fees, with no point‑of‑sale charges to patients (s. 8; s. 11(a)).
• Coverage must be universal for provincial residents, portable across provinces, and available after a waiting period no longer than 3 months (ss. 9‑10).
• The federal government may reduce or withhold contributions if a province does not comply, after a consultation process (ss. 13‑15).
• The Minister may help set up an independent drug agency to assess drugs, advise on the formulary, negotiate prices, and monitor safety (s. 16); the Governor in Council may set the list of insured drugs by regulation (s. 18).

What it means for you#

• Households

  • If your province opts in and qualifies, you would pay $0 at the pharmacy for drugs on the insured list and related dispensing fees (s. 8).
  • Everyone who is a resident is eligible on the same terms, with at most a 3‑month waiting period for new residents (s. 9; s. 10(a)).
  • Your coverage would travel with you. While temporarily in another province, your drugs would be paid at the host province’s approved rate; outside Canada, payment would match what your home province would have covered (s. 10(b)‑(c)).
  • Members of the Canadian Forces and federal inmates are excluded because they are covered under federal systems; their coverage would not change (Definitions “insured person”).

• Workers and people with private drug plans

  • The bill does not cancel private insurance. But for drugs on the insured list, provincial public plans would provide full coverage if your province participates (ss. 8‑9). Private plans could still cover non‑listed drugs or extras. Timing and details depend on provincial implementation and federal regulations.

• Businesses and private insurers

  • Employer plans may face reduced demand for drugs that become fully covered by public plans. The bill does not regulate employer plans directly. Impacts depend on which drugs are listed and how provinces redesign benefits (ss. 8, 18).

• Pharmacies and prescribers

  • Pharmacies would be paid under a provincially authorized tariff or payment system and may be subject to audits by the public authority (ss. 7, 11(b)).
  • Prescribers could receive guidance from a new drug agency on the most effective and cost‑effective use of medicines (s. 16).

• Provinces and territories

  • To receive federal cash contributions each fiscal year, a province must maintain a publicly administered, non‑profit plan that meets all five criteria and provide required information to the federal Minister (ss. 7‑12).
  • If a province does not comply, the federal government can reduce or withhold its cash contribution after notice and consultation (ss. 13‑15).
  • Key details—such as which drugs must be insured—would come later by federal regulation and advice from the drug agency (ss. 16, 18).

• Timing

  • The bill sets an annual reporting cycle but no start date for payments or coverage. Changes for residents would occur only after regulations are made and provinces implement compliant plans (ss. 5, 18‑19).

Expenses#

Estimated net cost: Data unavailable.

• The bill authorizes federal cash contributions to provinces but sets no dollar amount, formula, or appropriation (s. 5). Data unavailable.
• It creates an option to establish an independent drug agency but does not mandate it or fund it in statute (s. 16). Data unavailable.
• It allows reductions or withholdings of contributions for non‑compliance but does not specify amounts (ss. 14‑15). Data unavailable.
• No official fiscal note was published with this bill. Data unavailable.

Proponents' View#

• Improves access by requiring full public coverage at the point of care for insured drugs and dispensing fees, with no charges that impede reasonable access (s. 8; s. 11(a)).
• Ensures equal treatment across residents through universal, uniform conditions, and portability when people travel or move (ss. 9‑10).
• Promotes better value through a public, non‑profit payer, a national formulary set by regulation, and an independent drug agency to assess effectiveness and negotiate lower prices (ss. 16, 18).
• Points to potential system‑wide savings from bulk purchasing and a single‑payer approach. The Parliamentary Budget Officer (PBO) estimated that a national pharmacare model could lower total Canadian spending on prescription drugs by about CAD $4.2 billion per year, assuming 25% price reductions and a national formulary, though federal program costs would rise correspondingly (PBO, 2017).
• Adds transparency and accountability through required provincial reporting and an annual federal report to Parliament on compliance (ss. 12, 19).

Opponents' View#

• Fiscal risk and uncertainty: The bill sets no funding levels or formula. If implemented at scale, a federal pharmacare program could require large, ongoing federal outlays; PBO modeling of a comprehensive national plan projected gross federal costs of about CAD $19.3 billion (2015‑16 parameters), with results sensitive to the formulary and price assumptions (PBO, 2017). This bill does not define those parameters (ss. 5, 18).
• Provincial flexibility concerns: Federal conditions and the threat of withheld funds may constrain provincial policy choices or lead to disputes; enforcement actions could indirectly affect patients if funding is reduced (ss. 13‑15).
• Coverage trade‑offs: “Insured drugs” would be set by federal regulation. Drugs not on the list would not be covered under the public plan, which could limit access compared to some existing private plans (s. 18).
• Transition and implementation challenges: Provinces that rely on mixed public‑private coverage would need to build or expand public administration, payment systems, and data reporting, which could be complex and costly to implement (ss. 7, 12).
• Impact on private insurance and employment: A shift to public coverage for listed drugs could reduce the role of private drug insurance and affect related jobs and business lines. The bill provides no transition plan. Data unavailable.