What Proposed Universal Pharmacare and Dental Mean For Small Business
One of the hot topics of this upcoming provincial election is the inclusion of a Universal Pharmacare and/or Universal Dental Plan plan for all Ontario residents. Many small business owners and employees with private plans may be wondering, “how this will affect me and my business?”
Well to put it simply, you may see the cost of already expensive drug and dental costs go down. But there is still a cost associated with this.
The NDP party claims one in five Canadians can’t afford prescription drugs, which is why businesses who offer this coverage generally attract better employees. This election, three parties (NDP, Liberal and Green) are all suggesting changes to the way prescription drugs currently operate.
Universal Pharmacare = Cheaper Prescriptions
Just this year in Ontario, the Liberal government started offering OHIP+, which covers pharmacare for people under 25. However, this plan only covers prescription drugs and not other medical or dental expenses. This is only the first step toward health coverage, and as it stands now, businesses aren’t saving a great deal as most people under 25 don’t require expensive drugs.
But on the horizon is likely a plan that covers all Ontario residents would be a large undertaking and potentially save individuals and businesses billions of dollars.
A government has more pull to negotiate less expensive drug prices with pharmaceutical companies than private plan providers do. A recent parliamentary committee report stated Canadians can save up to $4.6 billion on drugs than with current private plans.
More to that point, an alternative to private coverage will create more competition. With more competition comes more competitive rates, and it may be easier to find better deals in the private sector, which is more good news for your bottom line.
What Does that Mean for Small Businesses?
The government likely won’t force you to use their plan. Essentially, what private coverage means is more choice in the hands of a small business. It’s likely a universal government-funded plan will stick to cost-saving measures like a formulary (a list of approved drugs), so there is potential some drugs covered on private plans won’t be covered on a government one.
If you and employees are happy with a government plan coverage, that may free up some of your benefits budget to invest in “next-level” benefits like paramedical (massage, chiropractic, etc.), wellness, or mental health services that won’t be covered in the government’s plan.
The Added Cost
While research has been put into finding out the drugs will cost less, it’s still a question of exactly how things will be paid for. The report above suggests a split between federal and provincial government – but exactly who pays for what, and how drugs will be paid for remains unclear.
It’s likely the case that pharma coverage would be covered by some sort of tax hike, but whether that burden falls on individuals, businesses or both is yet to be determined.
At the end of the day, you should ask yourself, “if drugs under a universal plan are cheaper overall, is a hike in taxes justified?”
Surely 20% of Canadians who are hoping to have cheaper drugs and longer lives would agree with a universal plan. But whether that decision is right for your business lies in your hands!
If you have any questions about private pharmacare or dental coverage, and possible changes coming your way, we’re always happy to have a chat. Feel free to reach out. We would love to hear from you!