Insurance & Medical Cannabis

65% of Canadians would take cannabis if covered by insurance

Reading Time: 3 minutes
Posted on July 30, 2019
Reading Time: 3 minutes

The conversation about medical cannabis use is changing with the legalization of recreational cannabis under the Cannabis Act. Prior to legalization, our knowledge and research was evolving more slowly than other drugs. However, the evidence that medical cannabis provides health benefits is growing; individuals, employees and employers want to know more about affordable coverage and whether medical cannabis should be covered under their group benefits plan.

Two-thirds of Canadians would take a drug containing cannabis if it were prescribed by a doctor, approved by Health Canada and covered by insurance, according to a recent Ipsos poll. Most Canadians are unaware that medical cannabis has been legal since 2001. Insurance companies have been slow to reimburse the cost because medical cannabis doesn’t have Health Canada’s regulatory approval in the form of a Drug Identification Number (DIN) and private insurers that are offering reimbursement have very strict guidelines patients must meet. This means patients must pay out of pocket, sometimes spending hundreds of dollars every month.

Unlike medical cannabis, recreational cannabis is not considered an eligible medical expense by Canada Revenue Agency (CRA) as defined under the Medical Expense Tax Credit . To obtain cannabis for medical purposes, a patient must get authorization (similar to a prescription) from a doctor or nurse practitioner who have the patient under current treatment.

Once the patient receives authorization and the cannabis must be purchased through a Licensed Producer. The only deduction available is for cannabis products such as fresh or dried cannabis, cannabis oils, and cannabis seeds.

Veterans Affairs was the first Canadian insurance provider to provide medical cannabis insurance. “The health and well-being of Veterans is a top priority for the Government of Canada. This was the fundamental consideration in the development of VAC’s reimbursement policy for cannabis for medical purposes, which was introduced on November 22, 2016. The policy established a reimbursement limit of three grams per day of cannabis for medical purposes sold by licensed producers or its equivalent in fresh cannabis or cannabis oil. In exceptional cases with the appropriate supporting medical documents, the Department will reimburse for more than three grams per day. Reimbursement may be also be approved for more than three grams per day if Veterans are ‘palliative’, or diagnosed with Amyotrophic Lateral Sclerosis (ALS) with a diagnosis from their treating physician. Consistent with how the Department administers its other health care benefits, a maximum rate of up to $8.50 per gram has been established. The rate will ensure that what Veterans are charged, and the Department reimburses, is a fair market value price. As with most medical benefits there is a limit on the cost Veterans Affairs Canada will reimburse per gram of cannabis. A maximum rate of $8.50 per gram of cannabis is covered and medical users must pay the rest out of pocket”.

Unions are also major supporters of providing coverage for medical cannabis to members. In 2017, the Ontario Public Service Employees Union (OPSEU) rolled out a new benefit plan that provided medical cannabis coverage for insured OPSEU staff. Under the new benefit, insured employees and their spouses and dependents can claim up to $3,000 a year for medical cannabis. For claims to be eligible, they must be prescriptions from licensed physicians, and the cannabis must be obtained from organizations legally authorized to produce and sell medical cannabis.

Many Licensed Producer’s offer compassionate pricing to low income individuals as well as people who are on programs such as the Ontario Disability Support Program (ODSP). They also offer additional benefits such as money towards vaporizers.

Medical cannabis users should work with a patient educator who can help them determine if they qualify for compassionate pricing or other benefits. Patient educators are also able to recommend LPs who offer compassionate pricing.

The lack of insurance coverage for medical cannabis keeps patients self-medicating in the grey market because prices are less expensive and the selection in grey market dispensaries is more robust.

Another concern facing insurers is a growing number of doctors who prescribe medical cannabis and then do not follow up with their patients to make sure the medication is working. Insurers feel that there needs to be more adequate medical oversight before they will begin covering medical cannabis. Cannabis clinics should support patients every step of the way. A multidisciplinary team should include doctors, nurses and patient educators who work with patients to understand cannabis products and appropriate dosing to produce the greatest benefits.

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