Every province and territory in Canada has a prescription drug benefit plan, with these plans varying in terms of the drugs that are covered, the population that they serve, deductibles, co-payments and maximums for coverage. However, many people are faced with high prescription costs, which they cannot afford. Newfoundland and Labrador has found a way to make drugs affordable for people with low incomes. While a step in the right direction, the Health Council has called for catastrophic drug coverage to help all Canadians, regardless of where they live, pay for expensive drugs to cover serious health conditions.

In April of this year, the Government of Newfoundland and Labrador announced plans to make medicine more affordable for individuals and families struggling with high drug costs through a new program enhancement to the Newfoundland and Labrador Prescription Drug Program (NLPDP). When fully implemented in October 2007, the program enhancement will benefit approximately 14,400 additional families at a cost of approximately $17.5 million annually.

The goal of the program enhancement is to protect any individual or family whose drug costs are consuming an unreasonable share of their income, whether it’s from a combined cost of using drugs for several common diseases, or one extremely high-cost drug for a less common or rare disease. This would include such diseases as arthritis, cancer, diabetes and multiple sclerosis.

The NLPDP comprises four programs:

1. Senior Citizens Drug Subsidy Program
2. Special Needs Program
3. Low Income Drug Program (LIPD)
4. Income Support Drug Program

The program enhancement is not based on age or disease, but is designed instead to assist people based on the cost of their drugs and their ability to pay. It is consistent with the approach taken by other provinces in the country, where residents are required to pay a portion of their drug costs usually based on their level of income. It is also consistent with the discussions occurring nationally regarding catastrophic drug coverage.

Through this enhancement to the NLPDP, individual families will have their annual out-of-pocket drug costs capped at an amount not exceeding 10% of their net family income. People at net incomes up to, but not including, $40,000 will pay a maximum of 5% of their net income. People with net incomes of $40,000 to under $75,000 will pay a maximum of 7.5%, and people earning $75,000 to under $150,000 will pay a maximum of 10%.

As an example, a couple without children with a net family income of $45,000 and annual drug costs of $12,000 is currently not eligible under the NLPDP. Under this new enhancement, their new drug costs would be capped at 7.5% of their net income, or $3,375 a year. Government would pay the remaining $8,625.

The Government of Newfoundland and Labrador has increased the annual investment in the NLPDP by almost 55%, from $97.5 million spent in 2003 to $151 million budgeted for 2007. This includes the introduction of the LIDP in January 2007, which represented the first expansion to the program since 1980.