Public-private partnership alternative for a national pharmacare program in Canada

Recently, the government and an opposition party cut a deal that involved a promise to consider implementing a single-payer pharmacare scheme in Canada in exchange for supporting the current minority government. There have been political headwinds from the private extended health insurance industry, the provinces of Ontario and Quebec, as well as the pharmaceutical industry. We suggest a new multiple-payer of mixed-resort framework that achieves both the goal of universal coverage and preserves the private extended health insurance industry through a scheme based on the current coordination of benefits between private payers in this sector.

We employ game theory to better understand the dynamics within a market that involves multiple payers. In particular, we use the game of Collective Action to help illustrate the problems of free-ridership.

An analysis of the dynamics of this market suggests that ex-ante agreements need to be struck between all payers in a multi-payer marketplace to achieve both stability and sustainability of such a framework.

We show that universal coverage is still possible while leveraging the existing system of private extended health insurance so long as a well-established system for coordinating benefits between public and private payers is established. A stable public/private partnership can achieve universal coverage so long as a system for coordinating benefits is instituted. The proposed alternative will achieve the same goals, but maintain a niche for the private sector thereby maintaining therapeutic variety in the marketplace.