The Canadian Drug Insurance Pooling Corporation (CDIPC) has extended a vital safety net to thousands of Canadians grappling with the financial burden of high-cost medications.
Through its network of 22 insurance companies, the CDIPC’s high-cost drug framework has provided coverage to over 15,000 Canadian employers and more than 32,000 individuals and families whose annual drug expenses surpassed $10,000.
Although individuals and families benefiting from these high-cost drugs represented merely 1.6% of insured persons, the expenses associated with their medications accounted for a staggering 36% of all drugs paid.
In 2022, member insurance companies reimbursed 38 new drugs, a decrease from the 48 reimbursed in the previous year.
Despite the reduction in the number of new drugs, the average annual reimbursement for these medications surged by 36%, from $44,700 in 2021 to $60,900 in 2022.
Dan Berty, executive director of CDIPC, highlighted the profound impact of the framework: “The increase in the average cost for new drugs in 2022 was the most significant year-over-year jump that CDIPC member companies have seen since its inception in 2012.
“Because it takes two to three years to see the full uptake of new drugs by patients and their effect on the pool, we expect the drugs first claimed in 2022 to have already had a very material impact on 2023’s high-cost drug experience.”
The CDIPC’s pooling framework has helped maintain the affordability of insurance plans amidst escalating drug costs, particularly for rare diseases.
The framework shields employers from direct premium increases stemming from high-cost or rare disease drug treatments claimed by employees.
“While year-over-year growth of the number of plan members dipped in 2021, we saw it increase again in 2022. This is a trend we expect to continue and is reflected in pooling premiums from insurers,” Berty said.
“Despite this trend and related pooling charge pressures, CDIPC’s EP3 pooling continues to shield small, mid-size, and some larger employers from the full impact of high-cost drug claims.”
Established in 2012, the CDIPC is a not-for-profit corporation that aims to help maintain drug coverage for Canadians and their employers through pooling the claims stemming from recurring high-cost drugs.
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