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Letter to The Honourable Ron Lemieux Re: Greater transparency of pharmacy fees in Manitoba


Release Date: 03/13/2014
Staff Reference: Stephen Frank

March 13, 2014


The Honourable Ron Lemieux
Minister of Tourism, Culture, Heritage,
Sport and Consumer Protection
118 Legislative Building
450 Broadway
Winnipeg, MB R3C 0V8


Dear Minister Lemieux:

I am writing to indicate the Canadian life and health insurance industry's support for requiring greater transparency of pharmacy fees in Manitoba in order to incent and facilitate informed consumer choice within the province.

The CLHIA is a voluntary association whose member companies account for 99 per cent of Canada’s life and health insurance business. At the end of 2012, private insurance plans in Manitoba provided some 830,000 people with supplementary health benefit coverage, including prescription drug benefits. During 2012, life and health insurers reimbursed about $249 million in prescription drug costs to policyholders and beneficiaries in Manitoba under these plans.

As you may be aware, the CLHIA released the attached prescription drug policy paper in June of 2013. It makes a number of important recommendations to improve the prescription drug system in Canada. One of the key recommendations in our paper relates to the need for more disclosure of pharmacy fees to allow consumers to make informed decisions about where to purchase their prescription drugs.

The paper notes that pharmacists play an important role in both patient care and helping to manage costs. With respect to the latter point, pharmacists' mark-ups and dispensing fees, along with their ability to influence generic and therapeutic substitution, are key drivers of costs. There are differing practices with respect to both mark-ups and dispensing fees by pharmacy across the province that can result in significantly different prices for consumers at the counter. In many cases, the higher prices are charged to those paying out-of-pocket or to employers who are providing drug coverage to their employees. This creates inequities in the system and undermines the financial sustainability of private coverage in the province.

The Canadian life and health insurance industry believes that it is important to empower consumers with greater information about pharmacy pricing in order to allow them to make informed decisions regarding where to purchase their prescription medication. In order for this to occur, however, consumers need to have visibility into these costs. Accordingly, Canada's life and health insurers believe that all receipts at the pharmacy should clearly disclose the dispensing fee charged, as well as the pharmacy mark-up.

Thank you for your attention to this important matter. We would be pleased to provide any additional information as you continue your deliberations.

Yours sincerely,

Original signed by

Frank Swedlove

c. The Honourable Erin Selby, Minister of Health