Generics approved by Health Canada are an effective alternative to brand-name drugs. But there will be exceptions under the new PSHCP for those who don’t tolerate them.
Following nearly 15 years of status quo and several years of negotiations to move the plan orward, the Public Service Health Care Plan (PSHCP) was finally updated when Canada’s Treasury Board approved recommendations submitted by the PSHCP Partners Committee, which is a collaborative body that develops joint recommendations to ensure the plan remains effective and sustainable. It had a pensioner representative who worked closely with the Association and its staff to ensure retired plan members’ needs were reflected in the new PSHCP.
In 2017, the Association surveyed approximately 19,000 members about the PSHCP and received nearly 9,000 responses. Members’ top priorities were vision care, the elimination of barriers to accessing physiotherapy and massage therapy, better paramedical and hearing aid coverage and improved hospital and emergency travel coverage. The renewed PSHCP delivers on each of those priorities.
Starting July 1, 2023, plan members will have access to many new coverage enhancements, such as vision care, mental health and paramedical coverage. Members will also have an easier time accessing their benefits because many paramedical services will no longer require a prescription for coverage. There will be some new features, such as prior authorization, mandatory generic substitution and some limits on pharmacy fees and how often those are eligible for reimbursement. For more details on how the plan will change, visit www.federalretirees.ca/pshcprenewal.
Mandatory generic substitution
While the numerous benefit improvements are good news, some aspects of the renewed plan are new and members have questions. One example of that is mandatory generic substitution.
In the simplest terms, plans with mandatory generic substitution reimburse drug claims up to the generic price, rather than the price of the brand-name drug. Generic drugs are usually a fraction of the cost of brand-name drugs. Drug co-payments still apply, whereby the plan covers 80 per cent.
Plans are taking steps to address drug costs, which have exploded over the past decade, and there are a few reasons for the increases many plans, including the PSHCP, have seen. For one thing, most newly approved drugs are in the “specialty” or biologic category, and are very costly. Plans are also identifying where their policies can encourage better spending decisions, such as through the use of cost-effective generics, or visiting pharmacies every three months for some drugs rather than monthly. After all, escalating drug costs mean escalating contribution rates for pensioners.
The widely held view that generic drugs are less effective must be debunked. Generic drugs approved by Health Canada are equivalent to brand-name drugs. They are required to be the same in terms of dosage of the active ingredient, safety, effectiveness, strength, stability, quality and how they’re taken.
Some plan members can have an intolerance for the non-active ingredients in generics, such as dyes and fillers, or the drug may not have the desired impact because of those products. That’s why we fought for and won an exception process based on medical necessity.
All plan members will have 180 days to make the transition from brand-name drugs. Members who need to continue with brand-name drugs will have their prescribing physician complete and submit a form to the insurance carrier to ensure coverage for the brand-name drug continues. Detailed information will be provided to plan members over the coming months.
What about the PDSP?
With the PSHCP renewed, Federal Retirees is turning its attention to the Pensioners Dental Services Plan (PDSP), which hasn’t seen significant improvements since its inception more than 20 years ago. Stay tuned for an updated survey on the PDSP — your input guides pensioner representatives and ensures your concerns are brought forward.
For any questions about changes to the PSHCP starting July 1, 2023, please write to pshcp@federalretirees.ca.