The COVID-19 crisis has resulted in unprecedented job and benefits loss for workers, and its full effect on the economy still remains to be seen. Pharmacare is crucial not only for health and equity in Canada but may also hold promise for economic health. As we slowly move into a post-pandemic economy, the implementation of universal pharmacare could increase labour market mobility, provide significant savings, and boost resources available to workers. This would help our country pull out of what could be the worst recession we have seen in decades.
In Canada, we currently rely on employer-based benefits to provide medication coverage. Wellesley Institute research has found that as a result of this, over 1 in 5 Ontario workers did not have pharma benefits pre-COVID-19, and that the benefit gap hits some of Ontarians harder than others. Part-time, younger, racialized and immigrant workers were all less likely to have benefits.
It is not surprising that when Canadians do not have drug coverage and cannot afford medications, they’re more likely to go without the prescription medications they need. Given that 5.5 million Canadians have since lost their jobs or have had hours reduced due to pandemic, we can expect that many Canadians have also lost their benefits and/or income – making access to medication increasingly difficult in the midst of this crisis.
Now more than ever, pharmacare not only makes sense for health and equity, but it also makes economic sense, and here is why:
Pharmacare would allow workers to change jobs and start small businesses without fear of losing their drug benefits
As our economy restructures going into the recession and recovery, workers must be positioned to be their most efficient and resourceful. New small businesses and workers being in the most productive jobs for them will be key to restarting economic growth. However, this can be hard to do when leaving your job or starting a new small business could mean losing your essential medication benefits. If we want to encourage workers to reach their full potential, and encourage the entrepreneurial spirit of Canadians, pharmacare would be a move in the right direction. With pharmacare covering every worker, business owner and their families, everyone would be able to access the medications they need.
Pharmacare would reduce costs for individuals and businesses of all sizes, in effect giving them an economic boost
Whether it is businesses contributing to employee medication insurance, or workers paying for their own medications, pharmacare would take these costs off of people’s shoulders. This would free both businesses and individuals to put more money towards more productive ends such as business investment and individual education and training. Eliminating the risk of unexpected medication costs for individual workers and their families would be additionally important at a time when many families are facing work interruptions and financial vulnerability. While pharmacare would be a significant increased cost for government, it would save Canadians collectively an estimated $4.2 billion every year.
Pharmacare could help boost workers’ wages, if we mandate that some or all of the savings for businesses get passed along to employees in the form of raises
Wages have stagnated for many workers since the 2008 Financial Crisis. We just lived through the longest bull market in the history of advanced capitalism, and yet the gains of this were highly unequally distributed. Already we’re seeing that this pandemic is widening gaps between workers: low-wage workers have been hit hardest by lost hours and non-unionized women have been most likely to lose their jobs. We must ensure this recovery is better than the last, and a broad wage increase for workers would contribute to this recovery.
A model for cost-sharing
Some or all of the savings for employers could be used to help cover the fiscal cost of universal pharmacare. Employers already contribute to cost-sharing the Canadian Pension Plan and Employment Insurance. Pharmacare could be a new employer contribution along the lines of these programs. It is reasonable that some of the cost of universal public pharmacare should fall on businesses, as businesses would share the benefit of healthier workers that pharmacare helps to provide.
These times of massive job loss and economic uncertainty raise the question: Is it acceptable for Canadians to continue to face financial barriers to essential parts of their health care? This is not limited to medication. Mental health services and therapy, dental care, and vision care, etc. are all necessary parts of health care, that can be inaccessible for laid off workers or those without workplace benefits in the first place.
It is time to start working towards the Great Recovery. Universal pharmacare would be a significant plank in any progressive recovery and stimulus plan. As we have seen massive public resources mobilized to fight the pandemic, making the strategic investment in pharmacare makes economic sense. Pharmacare is a good deal for workers, businesses, and every Canadian.