Employee Benefits

Upcoming Provincial Health Care Changes Affecting Benefit Plans

By Judith Mewhort on November, 19 2019

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The provinces of Ontario and Alberta recently altered their provincial health care plans which will result in changes to your company benefit plan if you have employees residing in either province. Ontario eliminated provincial out-of-country coverage for medical emergencies while travelling, and Alberta changed their prescription drug coverage available under the provincial plan. 

 

Ontario

Effective January 1, 2020, the Ontario Ministry of Health will no longer provide coverage for medical emergencies when an Ontario resident is travelling outside Canada. However, as required under the Canada Health Act, Ontario residents covered by the Ontario Health Insurance Plan (OHIP) will continue to receive coverage when travelling or moving within Canada.

 

Any claims for out of country emergency health services incurred up to and including December 31, 2019 must be submitted no later than the end of the following year, December 31, 2020. Claims occurring after January 1, 2020 will not be eligible for reimbursement.

The impact on Extended Health Care plans offered through employers is expected to be minimal due to the limited nature of the current OHIP coverage. Reimbursement is currently limited to the costs covered if the treatment were rendered in Ontario. Thus, the vast majority of out-of-country claim expenses are currently reimbursed by private insurance and not the provincial plan.

As a result, there should be little to no change in extended healthcare premiums in 2020 as a result of the Ministry’s decision. Administratively, the submission of out-of-country (OCC) claims under an employer-sponsored or individually-owned health plan will now be streamlined. All OCC claims for insured Ontarians will now be submitted directly to the group benefits carrier rather than needing to be sent to OHIP first.

At the same time that coverage for Ontarians experiencing medical emergencies while traveling outside of Canada is being eliminated, a new program to fund out-of-country dialysis services is being implemented. The new program will take effect on January 1, 2020. The addition of out-of-country dialysis coverage does not impact existing Group Benefits Extended Health Care plans, as dialysis is required for an ongoing medical condition and would not be considered a medical emergency under the definitions for out-of-country services.

 

Alberta

 

With the tabling of the 2019 Alberta Budget, the Alberta Finance Minister introduced changes to prescription drug coverage and an increase in the budget for three health initiatives. Alberta is following British Columbia’s lead and expanding its Biosimilars initiative. This change will result in Albertans who are currently receiving treatment for a variety of serious health conditions via Biologic Drugs to be switched to a lower cost Biosimilar Drug in situations where health outcomes will not be impaired. The expected start date for the change is January 2020. 

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In addition to expanding the Biosimilar initiative, up to 1,600 prescription drugs will now be included in the Maximum Allowable Cost (MAC) pricing rules which limits drug benefit coverage to lower-cost alternatives such as generic drugs which provide effective treatment at a lower cost. Where necessary to achieve the best health outcome, allowances will be made for those individuals who require continuation on the higher priced name-brand medication or Biologic.

In another cost saving measure, later this fiscal year the Alberta Seniors Drug Benefit Program will end dependent coverage for partners and other dependents under the age of 65. In addition the province will begin exploring the use of an income means test to determine future annual deductibles for prescription drug coverage rather than providing prescription medications free of charge for all Albertans age 65 and over.

The pricing impact on Group Benefit Health Plans is unknown at this point, but the expectation is that there may be upward pressure on the premiums for employer-sponsored plans as reimbursement for drugs previously covered under the provincial plan will now fall  to the private insurers.

 

Conclusion

For businesses with employees  in those provinces, these changes will have an impact on your benefits plan. Ontario employers will find that the Ontario Ministry of Health will no longer cover the medical expenses of provincial residents travelling outside Canada. The result will be a minor administrative change but should not result in any noticeable premium increase.  In Alberta, the expanded Biosimilar initiative and the changes to the Seniors Drug Benefit Program will reduce costs to the province but will likely result in premium increases for employer-sponsored plans.

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