In its 2020 budget submission to the Ontario government, the Canadian Life and Health Insurance Association is highlighting a lack of access to affordable prescription drugs and inflexible pension plans.
With respect to prescription drugs, the CLHIA noted it supports the federal Patented Medicine Prices Review Board reforms, which were introduced on Friday. “It is crucial that the federal government move ahead with these reforms to achieve affordability for consumers.”
It also said any reform of the prescription drug system should include protecting and enhancing existing benefits plans. “Ontarians value their benefits plans that provide them with access to a wide variety of health services, including prescription medicines, vision care, dental care and mental-health supports.
“These services both treat illness and contribute to overall wellness for the residents of Ontario. With COVID-19, employers have faced increasing pressure and life and health insurers have stepped up to help them maintain — and, in some cases, augment — their health benefits programs through premium reductions and deferrals.
“Working together with all levels of government, we will continue to help maintain benefits for workers in Ontario and across the country. Workplace plans have shown remarkable resilience, with industry-wide data collected by the CLHIA showing 98.5 per cent of the 26 million Canadians who had extended health benefits at the beginning of March continued to have coverage in mid-September.”
The CLHIA also recommended that federal, provincial and territorial governments and private insurers work together to develop a standard list of medicines that all Canadians can access regardless of where they live or whether they have workplace benefits. It noted private insurers want to work with governments to ensure access across the country, not only to the standard list of medicines, but also to high-cost medicines used to treat chronic and rare diseases.
“Governments should work together to make sure anyone who needs coverage can get it while ensuring that out-of-pocket costs are not a barrier,” said the submission. “Canadians need to be better able to navigate existing public plans so that they can access the coverage they are entitled to. One approach might be to ensure all Canadians are covered through a plan offered either by an employer or the government.”
With regards to pension plans, the CLHIA’s submission advocated for broader options for pooling individuals’ longevity risks, including variable payment life annuities and advanced life deferred annuities, both proposed in the federal government’s 2019 budget.
“Stand-alone VPLAs should be permitted to provide the broadest possible access for Canadians,” noted the submission. “In order to provide sustainable, affordable retirement income arrangements for older Ontarians, we encourage the government to monitor and parallel forthcoming federal measures to introduce ALDAs and VPLAs as new income options.”
Noting the significant savings shortfall and declining pension coverage for employees in the province, the CLHIA also recommended the Ontario government enable automatic pension plan participation.
“Even when employees do opt to join their workplace savings plans, many struggle with selecting the appropriate contribution level and investments for their needs,” stated the submission. “Many employees do not take full advantage of these plans, missing out on billions of dollars of potential matching contributions by their employers.”
Automatic features, which include automatic plan participation at a pre-set (or starter) contribution rate, automatic annual contribution increases and automatic investment in a default investment option, have all proven to be effective in increasing participation in workplace savings plans and the rate of savings in several countries, it noted.
“Such solutions remain rare in Canada, however, due mainly to legislative restrictions.”