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’ interest in implementing a pharmacare plan.
The 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.
“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”, explained Yves Giroux, PBO. “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”.
There 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. “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.”