The Fraser Institute News Release: Canada's Single-Payer Health Care System Not the Best Model for Providing Universal Prescription Drug Insurance

VANCOUVER, BRITISH COLUMBIA--(Marketwired - April 28, 2015) - The experience of other nations shows there are several options for introducing a universal drug insurance program, and it should not be based on the single-payer government-run option currently being debated in Canada, concludes a new study published by the Fraser Institute, an independent, non-partisan think-tank.

"Calls for a national government-run Pharmacare program are often founded on concerns about the affordability of prescription drugs, particularly for low-income Canadians. But expansion of government insurance coverage is not costless and must be judged against the coverage already provided by Canadian governments," said Nadeem Esmail, Fraser Institute senior fellow and co-author of Drug Coverage for Low-Income Families: The Canadian reality and lessons from Switzerland and the Netherlands.

The study is comprised of two essays which seek to inform the debate about prescription drug insurance policy in Canada.

The first essay provides an overview of provincial drug programs and concludes that low-income Canadians already have comprehensive prescription drug insurance coverage. While the levels of coverage vary province by province, lower-income Canadians have access to at least catastrophic insurance for prescription drugs while those on social assistance have coverage at very low or zero cost.

"It is critical to understand current coverage already available to Canadians, particularly those with lower-incomes, to judge whether expansions in government services would be a sound use of taxpayer dollars," Esmail said.

The second essay examines how Switzerland and the Netherlands - two countries often lauded for high performing health care systems - provide universal pharmaceutical coverage to their populations.

Interestingly, neither nation has opted to pursue a government-run insurance scheme, as has been widely-called for in Canada. Instead, both nations provide universal access for all health care services (including pharmaceuticals) through private insurers in schemes which involve health insurance premiums as well as some cost-sharing in the form of co-payments or deductibles. Low-income citizens and those exposed to high drug costs still have access to pharmaceuticals, however, through premium discounts, cost-sharing exemptions, and other public-safety nets.

"Providing additional access to prescription drugs for those in need doesn't require a government-run single payer program. The experience of the Dutch and Swiss systems shows there are other options that have proven themselves markedly superior in terms of cost effectiveness, wait times, and healthcare outcomes," added Bacchus Barua, Fraser Institute senior economist and co-author of the study.

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The Fraser Institute is an independent Canadian public policy research and educational organization with offices in Vancouver, Calgary, Toronto, and Montreal and ties to a global network of think-tanks in 87 countries. Its mission is to improve the quality of life for Canadians, their families and future generations by studying, measuring and broadly communicating the effects of government policies, entrepreneurship and choice on their well-being. To protect the Institute's independence, it does not accept grants from governments or contracts for research. Visit www.fraserinstitute.org.