Drug Benefits—Veterans Affairs Canada

Opening Statement to the Standing Committee on Health

Drug Benefits—Veterans Affairs Canada

(Report 4—2016 Spring Reports of the Auditor General of Canada)

1 December 2016

Michael Ferguson, CPA, CA
FCA (New Brunswick)
Auditor General of Canada

Mr. Chair, thank you for this opportunity to join representatives of Health Canada and Veterans Affairs Canada to assist you in your study on “Development of a National Pharmacare Program”.

My comments will be based on our 2016 Spring report on drug benefits for veterans. Joining me today is Dawn Campbell, the Director responsible for the audit.

Our audit examined three areas that pertain to any drug program. First, we examined veterans’ access to drug benefits. Second, we looked at the Department’s cost-effectiveness strategies. And finally, we examined how the Department monitored the veterans’ use of drugs covered by the program.

Decisions about which drugs to cover need to be well documented and clearly based on evidence such as clinical research and the needs of beneficiaries. Timelines need to be established for the implementation of decisions. In one case we examined, a decision by Veterans Affairs Canada’s Formulary Review Committee to limit access to a narcotic was still not implemented two years after the decision had been made.

Pharmacare programs need to have a framework that specifies the type of evidence required and how the evidence should be considered in deciding what drugs to cover. The framework would be used to decide which drugs to pay for and how much to pay for them. The framework should require that the drug benefits be kept up to date.

Some cost-effectiveness strategies will always be necessary. These can include substituting generics for brand name drugs and negotiating reduced dispensing fees with pharmacies. These strategies will need to be assessed regularly to determine if they have achieved the expected results, if they are up to date and if they have led to reduced costs for drugs and pharmacy services. Particular attention should be paid to implementing strategies related to expensive new drugs entering the market.

A well-defined approach to monitoring drug utilization is also important. The approach should serve the needs of the beneficiaries and help the program sponsor manage its drug benefits program. Particular attention should be paid to the utilization of some high-risk drugs which need to be adequately monitored in order to understand the trends and their use.

Our findings on the Veterans Affairs Canada’s management of drug benefits for veterans underscores the importance of the points I have outlined above.

In conclusion, as you may know, my 2016 Fall Reports were presented to Parliament earlier this week. I noted recurrent problems with government programs that are not designed to help those who have to navigate them and that focus more on what civil servants are doing than on what citizens are getting. It is critical for the government to understand that its services need to be built around citizens, not process. As such, I encourage the government to think at the design stage about how a Pharmacare program could deliver services that work for Canadians.

Mr. Chair, this concludes my opening remarks. We would be pleased to answer any questions the Committee may have. Thank you.