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Cost Estimate of a Single-payer Universal Drug Plan

Published on October 12, 2023 PDF(opens a new window)

This report estimates the total and incremental public cost of a single-payer universal drug plan— “Pharmacare”—over 2023-24 to 2027-28. The estimated cost reflects a national application of Quebec’s Régie de l’assurance maladie du Québec (RAMQ) formulary with universal access and a copayment scheme.

Communications

Quotes

  • Our report is based on a national application of the Régie de l'assurance maladie du Québec (RAMQ) drug formulary, with universal access and a standardized copayment scheme implemented by a single payer. According to our estimates, the additional cost to the public sector is estimated to be $11.2 billion in 2024-2025, increasing to $13.4 billion in 2027-2028.

  • The economy-wide savings on drug expenses generated by a single-payer plan would amount to $1.4 billion in 2024-2025, rising to $2.2 billion in 2027-28.

Yves Giroux
Parliamentary Budget Officer

News Release

{"id":54,"created_at":"2023-10-11T08:51:59-04:00","updated_at":"2023-10-13T11:17:22-04:00","slug":"despite-increased-incremental-cost-to-the-public-payer-economy-wide-savings-can-be-achieved-under-a-single-payer-universal-drug-plan-new-pbo-report-finds-malgre-un-cout-differentiel-accru-pour-le-payeur-public-des-economies-generalisees-peuvent-etre-realisees-dans-le-cadre-dun-regime-dassurance-medicaments-universel-a-payeur-unique-selon-un-nouveau-rapport-du-dpb","title_en":"Despite increased incremental cost to the public payer, economy-wide savings can be achieved under a single-payer universal drug plan, new PBO report finds","title_fr":"Malgr\u00e9 un co\u00fbt diff\u00e9rentiel accru pour le payeur public, des \u00e9conomies g\u00e9n\u00e9ralis\u00e9es peuvent \u00eatre r\u00e9alis\u00e9es dans le cadre d\u2019un r\u00e9gime d\u2019assurance-m\u00e9dicaments universel \u00e0 payeur unique, selon un nouveau rapport du DPB","body_en":"The Parliamentary Budget Officer (PBO) today released his estimate of the cost to the public sector (federal and provincial governments combined) for a single-payer universal drug plan over a five-year period effective January 1st, 2024 in response to Parliamentarians\u2019 interest in implementing a pharmacare plan.\n\nThe report, Cost Estimate of a Single-payer Universal Drug Plan, is an update of the first estimate, Federal Cost of a National Pharmacare Program, which was published in 2017. \n\n\u201cOur report is based on a national application of the R\u00e9gie de l\u0027assurance maladie du Qu\u00e9bec (RAMQ) drug formulary, with universal access and a standardized copayment scheme implemented by a single payer\u201d, explained Yves Giroux, PBO. \u201cAccording to our estimates, the additional cost to the public sector is estimated to be $11.2 billion in 2024-2025, increasing to $13.4 billion in 2027-2028\u201d.\n\nThere are incremental costs to the public sector resulting from expanding public expenditures to cover the private insurance and out-of-pocket market shares. However, as a result of the increased negotiating power of a single payer, economy-wide savings are expected. \u201cThe economy-wide savings on drug expenses generated by a single-payer plan would amount to $1.4 billion in 2024-2025, rising to $2.2 billion in 2027-28.\u201d","body_fr":"Le directeur parlementaire du budget (DPB) a publi\u00e9 aujourd\u2019hui son estimation du co\u00fbt pour le secteur public (gouvernements f\u00e9d\u00e9ral et provinciaux combin\u00e9s) d\u2019un r\u00e9gime universel d\u2019assurance-m\u00e9dicaments \u00e0 payeur unique sur une p\u00e9riode de cinq ans \u00e0 compter du 1er janvier 2024, en r\u00e9ponse \u00e0 l\u2019int\u00e9r\u00eat des parlementaires pour la mise en \u0153uvre d\u2019un tel r\u00e9gime.\n\nLe rapport, intitul\u00e9 Estimation des co\u00fbts d\u2019un r\u00e9gime d\u2019assurance-m\u00e9dicaments universel \u00e0 payeur unique, est une mise \u00e0 jour de la premi\u00e8re estimation, Co\u00fbts pour le gouvernement f\u00e9d\u00e9ral d\u2019un programme national d\u2019assurance-m\u00e9dicaments, publi\u00e9e en 2017. \n\n\u00ab Notre rapport est bas\u00e9 sur une application nationale de la liste de m\u00e9dicaments de la R\u00e9gie de l\u2019assurance maladie du Qu\u00e9bec (RAMQ), avec un acc\u00e8s universel et un syst\u00e8me de copaiement standardis\u00e9 mis en \u0153uvre par un payeur unique \u00bb, a expliqu\u00e9 Yves Giroux, DPB. \u00ab Selon nos estimations, le co\u00fbt additionnel pour le secteur public est estim\u00e9 \u00e0 11,2 milliards de dollars en 2024-2025 et augmentera pour s\u0027\u00e9tablir \u00e0 13,4 milliards de dollars en 2027-2028 \u00bb.\n\nL\u2019augmentation des d\u00e9penses publiques d\u00e9coule en bonne partie du transfert vers les gouvernements des co\u00fbts pr\u00e9sentement assum\u00e9s par les assureurs priv\u00e9s. En raison du pouvoir de n\u00e9gociation d\u2019un payeur unique, on s\u2019attend toutefois \u00e0 des \u00e9conomies pour les d\u00e9penses globales en m\u00e9dicaments. \u00ab Les \u00e9conomies sur l\u2019ensemble des d\u00e9penses de m\u00e9dicaments g\u00e9n\u00e9r\u00e9es par un r\u00e9gime \u00e0 payeur unique s\u2019\u00e9l\u00e8veraient \u00e0 1,4 milliard de dollars en 2024-2025, puis \u00e0 2,2 milliards de dollars en 2027-2028 \u00bb.","release_date":"2023-10-12T09:00:00-04:00","is_published":"2023-10-12T08:57:06-04:00","internal_id":"COM-2324-054","permalinks":{"en":{"website":"https:\/\/www.pbo-dpb.ca\/en\/blog\/news-releases--communiques-de-presse\/despite-increased-incremental-cost-to-the-public-payer-economy-wide-savings-can-be-achieved-under-a-single-payer-universal-drug-plan-new-pbo-report-finds-malgre-un-cout-differentiel-accru-pour-le-payeur-public-des-economies-generalisees-peuvent-etre-realisees-dans-le-cadre-dun-regime-dassurance-medicaments-universel-a-payeur-unique-selon-un-nouveau-rapport-du-dpb"},"fr":{"website":"https:\/\/www.pbo-dpb.ca\/fr\/blog\/news-releases--communiques-de-presse\/despite-increased-incremental-cost-to-the-public-payer-economy-wide-savings-can-be-achieved-under-a-single-payer-universal-drug-plan-new-pbo-report-finds-malgre-un-cout-differentiel-accru-pour-le-payeur-public-des-economies-generalisees-peuvent-etre-realisees-dans-le-cadre-dun-regime-dassurance-medicaments-universel-a-payeur-unique-selon-un-nouveau-rapport-du-dpb"}},"pivot":{"publication_id":763,"news_release_id":54}}
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