The federal auditor general is urging Veterans Affairs Canada to step up efforts to secure lower drug prices and look for ways to control spending on medical marijuana.
The auditor general’s latest report, tabled Tuesday in the House of Commons, found the department doesn’t have an adequate process in place for making evidence-based decisions related to its drug benefits list, nor does it have procedures in place to help ensure its formulary review committee systematically reviews evidence to support decisions about changes to the list.
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The report set out four recommendations. The first is that the department explore ways to contain the costs of medical marijuana because Veterans Affairs’ expenditures have risen significantly since new regulations by Health Canada took effect in 2013.
Medical marijuana has become the highest-cost item paid for under the drug component of Veteran Affairs’ benefits program, according to the report, and the department expects expenditures could reach $25 million in the 2016-17 fiscal year — almost a third of the drug costs under the plan.
The department has been covering the costs of medical marijuana for the past seven years and advised the auditor general that it covered only the amount recommended by a physician or medical professional. More specifically, it has approved coverage for 10 grams per day, per veteran, which the auditor general says is double the amount identified as being appropriate in Veterans Affairs’ consultations with external health professionals, and three-times the amount Health Canada has reported as being commonly used by individuals for medical purposes.
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The department has agreed to implementing a policy to contain the costs. In fact, Veterans Affairs Minister Kent Hehr said in a statement he requested a departmental review about six weeks ago to assess how the department provides marijuana for medical purposes as a benefit to veterans.
“We will use the results of the review, as well as information gathered from our consultations, to provide options which will ensure the ongoing health, safety and well-being of our veterans,” he added. “I look forward to providing an update on the review in the coming months.”
In relation to the auditor general’s findings on medical marijuana, Mike Blais, president and founder of Canadian Veterans Advocacy, calls the report “a generalized statement that affects doctor-client confidentiality. [It] doesn’t know why they are being prescribed or what they’re being prescribed.
“When we talk to cost, where was the government when [it] initiated this program, when it said it was OK for these growers to start production in Canada for medical marijuana? Every other pharmaceutical product that Canadians are provided has some form of regulatory control on it and a reference price.
“This is a viable, non-narcotic alternative that has worked very effectively on a scientific-test base, that is uncontaminated by politics and not contaminated by an illegal market. It’s disingenuous for us to be victims of this when the government should have been front and centre when [it] brought this in in 2008, defining what the cost would be.”
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Another recommendation is that Veterans Affairs should periodically review whether strategies are leading to reduced costs for drugs and pharmacy services. The auditor general found that despite Veterans Affairs Canada’s entry into agreements with pharmacy associations in British Columbia and Saskatchewan, it continued to benefit from the agreed-upon reductions even through its deal with B.C. had expired in 2012.
In response, Veterans Affairs says it will bring in regular assessments and reviews of its formulary in addition to looking at strategies used by other drug plans. It also said it has begun working with other federal organizations and the pan-Canadian Pharmaceutical Alliance to explore opportunities.
The auditor general is also recommending that Veterans Affairs develop a well-defined approach to drug-use monitoring to help it manage its drug benefits program.
The report said the department had directed its provider, Medavie Blue Cross, to monitor claims data for high-risk use patterns for some drugs, such as narcotics and sedatives. However, the auditor general found the department hadn’t documented the direction it provided to Medavie. It also hadn’t directed Medavie Blue Cross to monitor and report regularly on trends in the drugs that veterans commonly use, such as antidepressants and non-steroidal anti-inflammatory drugs.
Veterans Affairs has agreed to enhancing its drug-use monitoring process. “Accordingly, the department intends to develop an efficient approach, governance structure and oversight to establish safeguards, monitor trends and determine potential risks that could affect the health and well-being of its veteran population,” according to the report.
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The final recommendation from the auditor general is for Veterans Affairs Canada to implement a decision-making framework to decide which drugs to pay for and to what extent.
In response, Veterans Affairs has said it will implement the recommendations by May 2017. “We will act to implement each of these recommendations to make sure the health-care benefits program is efficient and effective for those using it,” said Hehr in a statement.
“We will also work to improve the delivery system in our department, across the government, and in partnership with the regulated health professionals who provide direct care to our veterans.”
Veterans Affairs Canada’s health-care benefits program provides drug benefits for eligible veterans, some of whom have complex health needs such as mental-health conditions, according to the report. In the 2014-15 fiscal year, the drug component of the benefits program covered drugs for roughly 51,000 veterans at a cost of $80 million.
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