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Free Prescription Drugs Could Reduce Overall Healthcare Costs in Canada: Study

Overall health care costs could be reduced in Canada by providing free prescription drugs to patients, according to a new study.

Led by a University of Toronto medical school researcher, the three-year study aimed to see how eliminating out-of-pocket costs for drugs would impact healthcare system spending, particularly for patients who reported delaying or not taking prescribed medications due to costs.

“There are millions of Canadians who report not taking medications because of the cost,” lead author and University of Toronto associate professor Dr. Nav Persaud told CTVNews.ca. “We were trying to measure the effects of providing people with free access to medicines, as would be the case in a national pharmaceutical program.”

The study tracked 786 adult patients in nine primary care centers in Ontario who were taking 128 different essential medications covering everything from diabetes to depression. In addition to prescriptions, the total cost of health care calculation included emergency room trips, hospitalizations, home care, and visits with doctors and specialists.

Over three years, the study found that average total health care spending was reduced by $4,465 per patient, or $1,488 per person per year.

“If you multiply that by the population, the savings would be much more than $1 billion a year in Canada, because there are estimates of between two and four million people who go off medication because of the cost,” Persaud, who is also the Canada’s Chair of Research in Health Justice and a staff physician and scientist at St. Michael’s Hospital in Toronto, he said.

Hospitalizations and intensive care unit stays accounted for the largest costs in the study.

“Could you imagine patients being better able to access their asthma or [chronic obstructive pulmonary disease] treatments are less likely to go to the emergency room or be hospitalized,” Persaud explained. , that stay might cost $10,000, and then they’re discharged with a box of insulin, but it only lasts about a month, and then they’re back in the hospital or the ICU.

The peer-reviewed study was published Friday by the American Medical Association’s Journal of Health Forum.

“These results suggest that directly eliminating drug costs for patients could reduce overall health care costs,” the study concluded. “This randomized clinical trial of an intervention has clear policy implications and provides insight into total health care costs using routinely collected administrative data.”

Canada is the only country in the world that has a universal healthcare system without universal coverage for prescription drugs. Known as pharmacare, such schemes pay for or subsidize the purchase of prescription drugs. Although Prime Minister Justin Trudeau and the Liberal Party included universal medicine in their 2019 federal election platform, they have yet to fully implement the campaign promise.

Trudeau, who currently heads a minority government, has relied on the support of the NDP to pass key legislation in what is known as the Confidence and Supply Agreement. One of the NDP’s conditions for the March 2022 deal was the introduction of a legislative framework for pharmacare by the end of 2023. However, there was no mention of pharmacare in the Liberals’ 2023 federal budget, released in March.

“What we were able to force the government to do is what we could negotiate,” NDP federal leader Jagmeet Singh said at the time. “Liberals don’t seem to be that busy.”

Persaud says that while the benefits to the health system are supported by a “mountain of evidence”, pharmaceutical care should also be seen as “a human right”.

“People who can’t afford life-saving treatments are going to bed tonight without these drugs,” Persaud said. “I think the main reason is lobbying by the pharmaceutical industry and the private insurance industry. For them, every dollar saved from pharmacare is a dollar less in revenue.”

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