Yahoo Finance Loblaw's medical marijuana coverage sets precedent for insurance industry
Marijuana law reform is set to get a boost this week with the Federal government releasing the official legislation on recreational use but the medicinal side got a lift of its own with Loblaw’s announcement to cover prescription cannabis through the employee health benefits plan.
The move could trickle down to other Canadian employers and their benefit plans and even set a precedent, says Paul Grootendorst, an expert on insurance and reimbursement and director of the division of social and administrative pharmacy in the Leslie Dan Faculty of Pharmacy at the University of Toronto.
“If other companies are followers and they want to make sure the benefits package is competitive with a rival, they may themselves elect to start covering this,” he says. “This could be a pretty big deal in terms of getting the ball rolling.”
Both the grocery giant Loblaws and pharmacy chain Shoppers Drug Mart have begun to accept claims for marijuana prescriptions “to treat spasticity and neuropathic pain associated with multiple sclerosis and nausea and vomiting in chemotherapy for cancer patients” Basil Rowe, senior vice-president of human resources at Loblaw Companies Ltd., said in an internal memo.
About 45,000 employees between Shoppers, Loblaw’s and Weston Foods – both corporate and store staff – will be eligible up to a maximum of $1,500 per year.
From outlaw to prescription
While insurers BMO and Sun Life changed their stance on marijuana smokers last June, no longer assessing them at smoker rates, covering the cost of marijuana is a whole new territory, one that is still rare for the insurance industry, says Grootendorst.
“I think it’s so new they don’t really know anything about it, companies just don’t really know what they’re dealing with here,” he says. “My sense is that if a company sees Shopper’s and Loblaws… companies with operations of that size doing it, they must think, well, if they’re doing it, marijuana must be good for those indications (conditions) at least and we’ll consider it.”
Currently, medicinal marijuana laws are a complicated matter – Canadians can both claim cannabis for medicinal use on their tax returns and legally travel with it on federal flights. But when it comes to the insurance side of things, cannabis has yet to be assigned a drug identification number by Health Canada meaning employers like Loblaw’s need to ask insurers for “extra-contractual provisions” in order to administer coverage.
He suspects companies like Loblaw will keep an eye on the latest studies to decide which prescription claims they’re willing to accept.
“(Cannabis) for musculoskeletal pain doesn’t have much effect apparently, neuropathic pain is good,” he says. “High cannabidiol extracts are good for relieving or reducing symptoms seizure-severity amongst kids and hence you’re seeing a bunch of those in the market now.”
But with its ownership of Shoppers, Grootendorst notes that Loblaw is in a good position to conduct its own research.
“Presumably, Shoppers has their own team of pharmacists… I suspect in this case it was Shoppers themselves that made the call on cancer and MS indications,” he says.
But even with the federal government’s recreational legislation to be tabled this week, on the medicinal side, it’s still a bit of a wild west.
“There are no constraints there are no official indications, Health Canada has not approved it so it’s kind of whatever you think it works for,” says Grootendorst.
