GroupNews – June 2019

Eckler’s GroupNews monthly newsletter provides commentary on the issues affecting Canadian group benefit plans.

In this edition:

• BC government expands use of biosimilar drugs
• Update on employment leave changes in Canadian jurisdictions
• Legislative round-up
• Highlights of the 2019 Sanofi Canada Healthcare Survey

Benefit plan management

BC government expands use of biosimilar drugs

The government of British Columbia has announced plans to expand the use of biosimilar drugs (biosimilars). The move is expected to create opportunities for new drug listings and improve existing coverage for patients in the province.

According to 2018 data from the Canadian Institute of Health Information, nearly 43% of prescribed drug spending was financed by the public sector (such as plans provided by provinces, territories, the federal government, etc.). Given that biologics are now commonly used to treat chronic conditions such as diabetes, arthritis and Crohn’s disease, they account for the highest proportion of public drug spending at over 8%.

The transition to biosimilars is expected to save close to $100 million over the first three years of the initiative, and will begin immediately. The first phase will require patients living with ankylosing spondylitis, diabetes, plaque psoriasis, psoriatic arthritis or rheumatoid arthritis to transition by November 25, 2019 and will focus on the following specific drug transitions:

• Rheumatology patients will transition from the biologic Enbrel to biosimilars such as Brenzys or Erelzi;
• Dermatology and rheumatology patients will transition from Remicade to Inflectra or Renflexis;
• Endocrinology patients will transition from Lantus to Basaglar; and
• Gastrointestinal patients will transition from Remicade to Inflectra or Reflexis.

While consultation with a physician is required to adapt a prescription for a biologic drug to its biosimilar, the province expects pharmacists to play a key role in the success of the biosimilar initiative and will provide a fee to pharmacists who notify patients that they may be affected by the initiative. Pharmacare coverage will cease for the original biologics for these indications as of November 25, 2019. The government has also announced patient support programs in conjunction with biosimilar manufacturers to minimize the impact of the biosimilars initiative. Exceptions may be granted for patients who are medically unable to transition to a biosimilar drug. Exceptional coverage will be reviewed by Pharmacare on a case-by-case basis, in consultation with physician-led advisory committees as needed. Transition periods for Crohn’s and ulcerative colitis patients will be announced in the coming months.

It should be noted that BC PharmaCare introduced a biosimilar policy in 2016, whereby new patients with certain conditions were approved for biosimilars only. Patients who were approved for the biologic prior to prescribed deadlines were eligible to continue with the original medication.

Impact: The BC government anticipates that transitioning to biosimilars will save $96.6 million over the first three years of the initiative, which is expected to be redirected to support additional drug listings and improved patient coverage. The impact on private plans will depend on what prescription drug plan strategies they have already implemented, and how effective their insurance or third-party provider is at integrating with the provincial pharmacare program – and what changes that provider will make in response to the provincial initiative.

For example, if a plan sponsor has implemented the BC PharmaCare formulary and the requirement to apply for Special Authority coverage where applicable, there may not be a material impact to the plan. However, if an open formulary is in place, the potential exists for increased costs to the private plan should members continue to claim for biologics that would no longer be partially paid for by BC PharmaCare. Plan sponsors with members in BC should request information from their provider on the approach they are taking in response to this initiative and the options available, and then communicate accordingly with their members.

As BC is the first province to initiate a transition to biosimilars for patients currently using biologics, GroupNews will continue to closely monitor the issue across the country.

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Legal and legislative updates

Update on employment leave changes in Canadian jurisdictions

Saskatchewan

Amendments to the Saskatchewan Employment Act introducing changes to maternity, parental, adoption and interpersonal violence leaves, and new legislation regarding critically ill adult leave have come into force. With changes originally introduced in November 2018, Bill 153, An Act to amend The Saskatchewan Employment Act respecting Leaves (Bill 153), received Royal Assent on May 15, 2019. Changes include:

• An expanded definition of interpersonal violence leave that includes sexual violence;
• Increases to maternity and adoption leave from 18 to 19 weeks;
• Increases to parental leave from 34 weeks to 59 weeks for the parent who gives birth, and up to 63 weeks for another parent (up from 37); and
• The addition of a leave for critically ill adults, allowing for 17 weeks of job-protected leave to care for a critically ill adult family member.

The government also announced that Bill 172, The Saskatchewan Employment (Paid Interpersonal Violence and Sexual Violence Leave) Amendment Act, 2019 (Bill 172), has come into force on May 15, 2019. Bill 172 allows employees who are survivors of interpersonal and sexual violence to take five paid and five unpaid days to seek medical attention, access support or relocate.

British Columbia

BC’s Bill 8, The Employment Standards Amendment Act (Bill 8), has received Royal Assent on May 30, 2019. Bill 8 introduces new job-protected leaves for critical illness or injury and domestic violence.

Employees will now be eligible for up to 36 weeks of unpaid leave to provide care or support to family members under the age of 19, and up to 16 weeks of unpaid leave for family members 19 or older who are diagnosed with a critical illness or injury. Employees must provide a certificate from a medical practitioner or nurse practitioner before commencing the leave.

Employees who experience domestic violence are now entitled to request up to 10 days of unpaid leave to seek medical attention, obtain victim or social services, obtain psychological or other professional counselling, seek legal or law enforcement assistance, or temporarily or permanently relocate. Employees are also entitled to request an additional 15 weeks of unpaid leave time.

Impact: As Canadian jurisdictions continue to enhance leave provisions to reflect the needs of Canadians, it is imperative that plan sponsors review their HR policies and benefit programs to ensure that they remain compliant with legislative requirements.

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Legislative news and updates

Legislative round-up

British Columbia

Bill 20, the Medicare Protection Amendment Act, 2019 (Bill 20), received Royal Assent on May 16, 2019. As discussed previously, Bill 20 eliminates the premiums under the province’s health insurance program, the Medical Services Plan. Premiums will be eliminated effective January 1, 2020.

Manitoba

Bill 16, The Budget Implementation and Tax Statutes Amendment Act, 2019, received Royal Assent on
June 3, 2019. The bill reduces the Manitoba Retail Sales Tax from 8% to 7% and will result in a corresponding reduction in plan expenditures for plan sponsors. The reduction will take effect on July 1, 2019.

Canada Revenue Agency

The Canada Revenue Agency has issued notices on three items introduced in the March 19, 2019 Federal Budget:

• Notice 313: Proposed Change for the Purpose of Zero-rating Certain Foot Care Devices;
• Notice 312: Proposed GST/HST Treatment of Supplies of Human Ova and In Vitro Embryos; and
• Notice 311: Proposed Exemption of Multidisciplinary Health Care Services from GST/HST.

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Research

Highlights of the 2019 Sanofi Canada Healthcare Survey

Released in June 2019, the 22^nd annual Sanofi Canada Healthcare Survey asked 1,505 plan members and 403 plan sponsors for their opinion on “closing knowledge gaps” in their health benefit plan knowledge. The survey aims to address knowledge gaps in order to identify issues to improve on health plan communication and implementation.

This year’s survey revealed gaps in knowledge in a number of areas, including:

• Plan members and plan sponsors significantly underestimate the number of drugs covered by their workplace prescription drug plans;
• Plan sponsors continue to underestimate the presence of chronic disease or conditions in the workplace;
• Plan members consider improved physical fitness a priority, while plan sponsors consider improved mental health a priority when investing in wellness initiatives; and
• Four out of five plan sponsors would like to have a better understanding of absenteeism in their workforce.

The survey discusses knowledge gaps in greater detail under the following headings:

• Health and Chronic Disease: Multiple facets of health, the importance of workplace wellness, and being mindful about safety and health;
• Understanding Health Benefit Plans: Quality assessments, how benefit plans work, and how private drug plans are misunderstood;
• Looking Ahead at Benefits: Taking aim at engagement, the changing menu for health benefits, and holistic approaches to wellness; and
• Analysis and Decision-Making: Better analysis for better health, a closer look at drug plan costs, and steps for a healthier health benefit plan.

Impact: The survey results also cover a range of other topics, such as the funding of health benefits plans, responses to plan changes, and possible scenarios for national pharmacare. The survey serves as a useful tool to encourage discussion and provide guidance to stakeholders on decisions to be made about the future of health plans.

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