Fair or Not - Pharmacare

February 13, 2003

Fair or Not - Pharmacare

Will the Campbell government take close to $200 million out of the Pharmacare program and then throw a little back to low income people so as to disguise the change? Does it know the difference between what the Throne Speech called new "cost containment strategies" and what everyone will recognize as cost shifting? Is it "fair" that a sick senior who needs drugs should pay more fees and taxes than a healthy neighbour with the same income?

On Throne Speech day government had the Lieutenant Governor say something about "Fair Pharmacare". Will it be "fair" to reduce drug payments for sick seniors? Last year's "service plan" indicated that Pharmacare would be cut by $88 million in 2003-04. Since growth due to price and other factors is usually double digit, that amounts to a real cut close to $200 million. At the staged cabinet meeting, Gary Collins said that the real "service plan" for the Ministry of Health Services won't be tabled in the Legislature for several weeks after budget day. That means it may be several weeks before we know whether "Fair Pharmacare" means less for several hundred thousand people. That would be consistent with "New Speak in the New Era" where "protection" means "cuts" and "fair" means "less".

Most people do not understand the different plans in the current Pharmacare system. Pharmacare for those over age 65 represented $352 million out of Pharmacare's total $657 million budget in 2001. Regardless of income or age, everyone covered by MSP is eligible for Plan E which is described as follows:

"Effective January 1, 2002, under regular Plan E, the current annual deductible is $1,000. When the total expenses for eligible prescription drugs and other benefits for your family reach the annual deductible, Pharmacare automatically covers 70 per cent of the cost of further eligible benefit items for the remainder of the year. Once a family has paid $2,000 in costs recognized by Pharmacare, any further eligible costs are covered 100 per cent."

Plan E, sometimes called "universal Pharmacare", paid $117 million to British Columbians in 2001. Other Pharmacare plans include provisions for people on welfare, for people in long term care facilities, for those with Cystic Fibrosis, for those in mental health facilities and for children in care of the Ministry of Children and Family Development.

It is expected that government will change eligibility and base it on income, thereby reducing its payout while saying that it is fairer because some low income people will then qualify before they reach $1,000 in family expenditures, as is now required for universal Pharmacare, Plan E. An alternative would be to say that healthy people should pay through their income taxes which vary by income level so Pharmacare can make payments to sick people of any income level. When you consider people in Plan E, which covers most people not on welfare and under age 65, an argument can be made that it is not fair that a person making $30,000 a year has the same coverage as someone making $90,000 per year. Those considerations didn't trouble the Campbell government when it came to giving high income earners the largest percentage of the tax benefits, or when it came to increasing MSP premiums equally for both groups, but now it is convenient to play the working poor off against low income seniors.

When "Fair Pharmacare" is introduced, look to see whether government pays tens of millions of dollars less. Will a little money be given to low to middle income families and individuals at the expense of middle income seniors, so as to justify government shifting tens of millions in drug costs onto sick seniors? That is what the 2002 "service plan" for the Ministry of Health Services suggested. Only time will tell, but those who are hurt will have more than two years of experience with the "Fair" system before they decide how they will cast their vote on May 17, 2005.