Canada will study national pharmacare. Here’s how other jurisdictions do it.

Click to play video: 'Federal Budget 2018:  Government announces national pharmacare council'
Federal Budget 2018: Government announces national pharmacare council
Finance Minister Bill Morneau announced the government will pursue a national pharmacare council to study the cost of prescription drugs, to be headed by former Ontario Health Minister Eric Hoskins – Feb 27, 2018

The federal government is going to study how to implement national pharmacare, it announced in its budget on Tuesday.

The advisory council, chaired by former Ontario health minister Eric Hoskins, is going to study domestic and international pharmacare programs and recommend ways to move forward with implementing it nationally.

But what that will look like remains to be seen.

WATCH: NDP Leader Jagmeet Singh said Tuesday that he was encouraged by pay equity being looked at in Federal Budget 2018, but said he had concerns over funding for income equality and the pharmacare plan.

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Federal Budget 2018: NDP concerned over income equality, pharmacare

Finance minister Bill Morneau appears to be leaving the government’s options open. In an appearance at the Economic Club of Canada on Wednesday morning, he said they were looking at ways to ensure that people who can’t currently afford their medication will be able to get it, but suggested that this wouldn’t necessarily require a complete revision of the current system.

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“We need to do it in a way that’s responsible, that deals with the gaps, but doesn’t throw out the system that we currently have. That will require some study,” he said.

There are lots of examples for the advisory council to look at.

The starting point

Canadians have medically-necessary hospital and medical care covered by public insurance, but prescription medication is covered by a mishmash of private, public and out-of-pocket charges, depending on a person’s circumstances. This is pretty unique internationally.

“If you look at the countries that provide universal hospital and physician coverage like we do, by and large, they will also include pharmaceuticals as part of that benefit package,” said Michael Law, the Canada Research Chair in Access to Medicines at the University of British Columbia.

WATCH: NDP slam Liberals over pharmacare advisory council

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NDP slam Liberals over pharmacare advisory council

In a recent paper that he co-authored, researchers found that about 5.5 per cent of Canadians reported being unable to afford one or more drugs in the prior year. An estimated 730,000 people had to cut back on food costs to pay for their medication.

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“There’s all sorts of reasons why you might want to see people stop taking a drug,” he said. “It doesn’t work, or the side effects are bad. But it would be my argument that cost would not be one of the things you’d like to see.”

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WATCH: Canadian doctor, medical, union and retiree groups called on the federal government to design and fund a universal prescription drug plan that would help provide affordable medication to more Canadians.

Click to play video: 'Universal pharmacare would provide more access to affordable drugs'
Universal pharmacare would provide more access to affordable drugs

According to data from the Canadian Institute for Health Information, Canadians spend more on prescription drugs through private insurance and out-of-pocket expenses than what comes from the government.

On a per-capita basis:

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  • $395 comes from the public sector
  • $329 comes from private insurance
  • $202 is an out-of-pocket expense.

Provincial programs

All provinces in Canada have drug programs for seniors and people on social assistance, according to a 2016 survey prepared for Alberta Health. Law said that all provinces also have some kind of program to help people when their drug costs are excessively high relative to their income. Ontario also recently started covering prescription medication for people under 25 years old.

WATCH: Ontario’s Minister of Health Eric Hoskins tells Focus Ontario host Alan Carter the Liberal government is looking at expanding pharmacare in the 2018 budget.

Click to play video: 'Ontario eyes an expansion to Pharmacare program'
Ontario eyes an expansion to Pharmacare program

“Quebec is the province that stands out as being the most different,” he said. “They have a system where employers cover people and people can also buy into the public program. So Quebec has much more of a universal type of insurance than other provinces.”

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But if 5.5 per cent of Canadians still can’t afford their medication, then these provincial programs aren’t addressing all the needs out there.

Other countries

Law suggested that the researchers look at other countries similar to Canada for ideas, like Western Europe and Australia.

OECD data from 2015 shows Canada near the bottom of 28 countries when it comes the percentage of spending on drugs that is covered by the public sector.

In the United Kingdom, the public sector accounts for 67 per cent of pharmaceutical spending. In Australia, it was 48 per cent in 2014. In Canada, it’s around 36 per cent.

Currently, if you want to fill a drug prescription under England’s public health system, you pay a flat fee of 8.60 pounds (about $15.19 Canadian). If you have a lot of prescriptions, you can buy a pre-paid certificate that will cover you for a set amount of time. It’s a bit like a transit pass: you can pay individually for each bus ride, or buy a pass for a higher price but get unlimited rides for the duration.

A lot of people are exempt from paying at all: people over 60 or under 16, pregnant women and women who have recently given birth, people with some listed medical conditions, and people on a number of social assistance programs. Prescriptions in Northern Ireland, Scotland and Wales are generally free.

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Similarly, in New Zealand, people pay NZ$5 ($4.63 Canadian) per prescription for fully-subsidized medicines. If a family has more than 20 prescriptions in a year, they won’t have to pay for any more until Feb. 1 the following year.

Children under 13 don’t have to pay fees.

In Australia, a member of the general public will spend a maximum of A$39.50 ($39.36 Canadian) to get most prescriptions filled, though many items might cost less. If a family spends more than A$1,521 on prescriptions in a year, they don’t have to pay any more that year.

Significant discounts are given to many seniors, people on social assistance and a number of other groups.

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