The problem with this new test, particularly for PHSP sponsors and administrators (e.g., insurers, third-party administrators), is the lack of consistency across Canada regarding which OTCs are located behind the counter in pharmacies. The National Association of Pharmacy Regulatory Authorities manual, Canada’s National Drug Scheduling System classifies drugs according to three schedules.
| Requirements | METC/PHSP Eligible? | |
| Schedule I | Available only by prescription and are provided by a pharmacist | Yes |
| Schedule II | No prescription required, but only available from pharmacist | Yes |
| Schedule III | No prescription required and are available without intervention of a pharmacist | No |
However, drug classification is a provincial responsibility, and not all provinces have adopted the Manual. While Manitoba, New Brunswick, Nova Scotia, Ontario and Prince Edward Island reference the Manual in their regulations, Alberta, British Columbia, Newfoundland and Labrador, Quebec and Saskatchewan have their own drug schedules. While Finance considered developing a schedule of OTCs that were eligible for the METC, they were not able to formulate one due to provincial differences.
Administrators of PHSPs with members in more than one province will therefore need to keep abreast of multiple drug schedules to determine whether an OTC can be covered by their plan. Although these plans may experience a decline in the number of claims filed for OTCs, depending on plan wording, any savings will likely be offset by the increase in the complexity and costs of administering such plans. Plan sponsors with employees in multiple jurisdictions will also need to ensure that the differences in coverage, and the reasons for them, are communicated clearly and consistently to all members.
There are additional problems faced by sponsors and administrators of PHSPs with members in Quebec. Quebec actually requires coverage of specific OTCs included on the provincial drug plan formulary, and PHSPs that do not provide coverage for listed drugs for Quebec members could be deemed illegal pursuant to the province’s prescription drug insurance legislation. A review of the drug schedules used by the RAMQ and the Ordre des pharmaciens du Québec (OPQ) indicates that a number of Schedule III drugs, such as acetaminophen and nicotine, are covered by the RAMQ. Based on the wording of the federal draft legislative provisions, this will put administrators and sponsors of PHSPs with Quebec members in a position where it appears they cannot comply with both CRA and RAMQ requirements.
Implications for Employers
If the proposals are enacted in their current form, the METC provisions will be effective retroactive to February 27, 2008. While it is unlikely that the CRA will audit PHSPs based on their treatment of OTCs between that date and the date the legislative proposals become final, plan sponsors should prepare to comply with the new METC rules by:
• Reviewing their plan text to determine what OTCs, if any, it covers; and
• Reviewing collective agreement provisions regarding PHSPs.
If the draft legislative proposals are adopted in their current form, sponsors and administrators of PHSPs will need to:
• Determine whether the OTCs are Schedule II Drugs in all jurisdictions where the plan has members, or whether any changes to OTC coverage are required;
• Amend the PHSP to remove or restrict coverage for any OTCs that do not require the intervention of a physician, pharmacist or other medical practitioner in one or more jurisdictions; and
• Develop a communications strategy to advise PHSP members of any changes to their plan.
Karen DeBortoli is director with the Canadian Research & Innovation Centre of Watson Wyatt and François Poirier is senior consultant, Group & Health Care, Central Canada with Watson Wyatt. They can be reached at: Karen.DeBortoli@watsonwyatt.com /Francois.Poirier@watsonwyatt.com
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