The number of high-cost prescription drug claims that Canada’s private insurers covered for Canadians with fully insured supplementary health insurance plans doubled in the Canadian Drug Insurance Pooling Corporation’s (CDIPC) first year of operation.
“Without this system, many Canadians would be left without access to the prescription drugs they need to help them deal with rare and often life-threatening conditions,” notes Frank Swedlove, president of the Canadian Life and Health Insurance Association (CLHIA).
In 2013, under the new pooling mechanism, insurers in Canada paid more than 4,000 claims for prescription drugs that cost in excess of $25,000. This was up from 2,000 when the CDIPC was first established in 2012. Several claims exceeded $500,000, including one claim for more than $1.2 million.
In the absence of a catastrophic drug program in Canada, life and health insurers voluntarily established the CDIPC. Under the CDIPC, they share the costs of highly expensive and recurring drug treatments in order to protect fully insured private drug plans from the full financial impact of high-cost drugs.
By pooling these costs, the industry has taken a proactive approach to sheltering employers and, ultimately, employees from the potential devastating financial impacts that even a single ongoing claim for highly expensive drug treatments could have on the sustainability of supplemental drug plans. This has been particularly beneficial to the small and medium-size business community.
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