Health plans to benefit from generic drug changes: Minister

“All employees should be well aware that their premiums should come down…or the range of services expanded,” Matthews told the Star, adding that prescription drugs typically account for 85% of health plan costs and that employers and insurance companies should not be pocketing the savings.

“There will be substantial savings,” said Matthews. “There is no question that people who have their drugs paid for through an employer plan will benefit from this.”

However, she admitted that the government has no power to ensure that savings are passed on to workers, and employees will have to be vigilant to ensure that they receive the government’s intended benefit.

Ontario opposition leaders Tim Hudak (PC) and Andrea Horwath (NDP) have called the government’s hard line against the pharmacy industry into question and have suggested that the plan has not been completely thought through.

Battle of the airwaves
On Monday, Ontario’s pharmacy industry went on the offensive with an ad campaign warning consumers that “Dalton McGuinty is trying to cut front-line healthcare at your local pharmacy.” The radio and newspaper ads ask the public to contact their MPPs to stop the proposed cuts from happening.

In response, the Ontario government has launched an online campaign of its own through YouTube with videos featuring Minister Matthews, CARP’s Susan Eng and acting CEO of the Canadian Cancer Society, Rick Perciante.

“Ontarians pay way too much for drugs,” explains Matthews in a video. “I don’t think Ontarians understand how much more they’re paying than people in other countries. We need to bring the price of drugs down in this province.”

Matthews also refers to the system of professional allowances as unaccountable and lacking transparency, and says she wants to pay pharmacists directly for the services they provide. “These changes will allow us to treat the professional pharmacists as the healthcare providers that they are.”

More info can be found at http://www.youtube.com/user/ontariomohltc and http://www.health.gov.on.ca/en/public/programs/drugreforms/.

The Ontario government announced sweeping new regulations on April 8 aimed at lowering costs for generic drugs and pharmacy services, including the elimination of up to $750 million in professional allowances paid to pharmacists by generic drug manufacturers. Pharmacists contend that the allowances are crucial to their business model and that both large and small pharmacies will have to cut staff, reduce operating hours and limit services currently available to consumers.

The changes are expected to bring about savings for plan sponsors. According to Hewitt Associates, employers can expect the Ontario portion of their prescription drug plan costs to drop by approximately 8% immediately, and by 16% within two years.

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