© Copyright 2006 Rogers Publishing Ltd. The following article first appeared in the June 2005 edition of BENEFITS CANADA magazine.
Plan sponsors are unhappy about their absence from the Politique du médicament, a government white paper that proposes changes to Quebec’s drug industry.

A WHITE PAPER THAT PROPOSES TO REFORM QUEBEC’S DRUG industry has plan sponsors seeing red. The Politique du médicament—the first government drug reform proposal since 1997—sounds good. Its four key aims: more accessibility to drugs, fairer drug pricing, optimal drug utilization programs and the maintenance of a healthy pharmaceutical industry in Quebec. “This drug policy…it really makes sense,” says Francois Picard, a managing partner with Morneau Sobeco’s benefits practice in Montreal.

So why has it touched off a firestorm among employers?

The answer, says Johanne Brosseau, a senior consultant with Aon Consulting in Montreal, is that it’s “craftily” written. Plan sponsors will find that although they’re not mentioned in the text, they’re the unwitting recipients of more cost-shifting. “Sponsors say(to the government): ‘You never mention us, you never talked to us, you never included us in the decision- making process and yet RAMQ(La Régie de l’assurance maladie du Québec, which administers Quebec’s Health Insurance Plan and the Public Prescription Drug Insurance Plan)which is responsible for [fewer] Quebeckers than us, is part of that decision- making,’” she says. Brosseau adds there are three areas of concern for Quebec sponsors of private plans:

1. Transfer of costs. The Politique indicates that drugs currently administered to ambulatory patients in hospitals(except cancer patients)will be offloaded to the private sector. This means costs will be higher for sponsors and plan members, as they will now have to pay deductibles and coinsurance for drugs. Sponsors want a mechanism put in place that ensures prices of drugs are capped at the pharmacy level and through tendering processes such as those afforded to hospitals. “[Hospitals] pay for these drugs a lower price than we would in the private or the public sector because we don’t go for tender,” says Brosseau. That means that a given drug in a private plan—already more expensive—will have a pharmacist fee added to it and will cost more.

2. Drugs under prior authorization. According to Brosseau, too many unnecessary drugs have been added to the prior authorization list. While more employers recognize the need to submit costly medications for prior approval, they want the government to pull drugs that have no financial risk for insureds but are costly for sponsors to administer and prone to claimant abuse.

As well, though the white paper promises the province will pay for medication taken by patients with inherited metabolic diseases that can often total $300,000 per year, there is no mention of privatelyinsured individuals being entitled to coverage.

3. The maintenance of a 15-year drug price. Under current law, RAMQ will limit the reimbursement of brand name drugs to the best available price of a generic only when the brand name drug has been listed on the formulary for 15 years, even if the federal patent has expired. This approach, called BAP+15, does not apply to private plans. But because it is mandatory to reimburse at least 71.5% of the amount claimed for a brand name drug, sponsors cannot realize the full savings resulting from generic substitution. “We say: do whatever you want to help the pharma industry with the public plan but allow us some leeway to promote generic substitution and eliminate the iniquities between the public plan and the private plans,” says Brosseau.

There is concern change could come swiftly. The white paper is soon to be introduced in parliament as a bill and will probably be adopted by the end of the year. Picard advises sponsors gird themselves. “They should apply best practices in the way they manage their current benefits plan and their current drug plan.”

At press time, Brosseau had been invited to a public hearing with government officials. But she’s still frustrated with the marked absence of the of private sector in the Politique. “If you want to keep our money,” she says to the government, “then maybe you should give us a say—because we’re pretty fed up.”

Anna Sharratt is managing editor of BENEFITS CANADA.

For a PDF version of this article, click here.