February 28, 2018

in Government Updates

Federal budget unveils advisory council on implementation of national pharmacare

In Ottawa this week the federal government unveiled the federal budget, along with the creation of an advisory council on the implementation of a national pharmacare strategy intended to address gaps in the system. 

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"Depending on the strategy that is adopted, this could have a impact on private plans, however early indications are that the strategy is intended to fill existing gaps in coverage, not replace the current system." Accompass Vice President Tiina Liivet said.

Former Ontario health minister Eric Hoskins has been pegged to lead the effort. Hoskins was instrumental in introducing OHIP+, Ontario's initiative to subsidize the cost of drugs for children and youth under the age of 25.

The budget also included a new five-week incentive for the second parent to take parental leave, with EI parental benefits increasing from 35 weeks to 40 weeks.

"The 40 weeks can be shared between parents, however one parent cannot take more than 35 weeks," Liivet explained. "So effectively the additional weeks must be used by the second parent, or they lose it." Liivet further noted that this would not impact benefit plans or any parental top ups, since plans are currently written to reflect the 35 week maximum period for one parent, which is not changing.

The federal budget also signalled the end of health and welfare trusts, leading to either a conversion to employee life and health trusts or a full windup by the end of 2020. The government will be seeking stakeholder input in the process.

Another feature of the budget was confirmation that employee contributions to the enhanced portion of the QPP will be treated as tax deductible, similar to the enhanced CPP. Since contributions to the enhanced portion of the QPP will begin to be phased in starting in 2019, this measure will apply to the 2019 and subsequent taxation years.