While advisors might consider escalating medical prices out of their control there are some things that can be done to help clients cope
Drug prices for badly needed drug treatments in Canada are clearly on the rise; advisors and non-advisors alike are well aware of this unfortunate trend and seemingly there’s nothing that can be done.
Recently the Canadian Drug Insurance Pooling Corporation (CDIPC) issued a press release stating that the cost of covering highly expensive and recurring drug treatments increased by 45% over 2013 for life and health insurance industry benefit plans.
But before we just throw up our hands it’s best to consider this subject in its entirety. Solutions, in addition to CDIPC do exist.
“A single government monopoly is not needed," Frank Swedlove, President and CEO of the CLHIA remarked about a national pharmacare plan in early 2015. "Bulk purchasing of drugs will lead to major savings. These savings can be achieved through greater cooperation between the public and private sectors.”
As it stands now there is a patchwork of prescription drug coverage in this country that results in higher costs for drugs than is necessary.
A big problem according to Stephen Frank, CLHIA’s vice president of policy development and health, is that any pricing power extracted through the Pan-Canadian Pharmaceutical Alliance have not trickled down to employer plans and individuals.
So, while it appears the answer lies with the insurance industry, others believe entrepreneurial small businesses operating in group benefits might be better served in figuring out how to bring those costs lower.
“Having been in the business for over 36 years, the one thing that has remained a dominant constant, is the inability of the insurance industry to innovate on any product or service,” wrote Jack Kennedy in LHP. “The industry takes a "wait and see" approach to innovation, allowing the small business sector to foray into the area of development and innovation.”
Sure, the CDIPC does its bit, but on the group front, which many Canadians use to pay for drugs, innovation can make a difference.
In 2016, we’re sure to hear more on this front.
