Government-sanctioned price gouging
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Hey there, time traveller!
This article was published 16/04/2020 (1142 days ago), so information in it may no longer be current.
Karen Alexander’s April 13 letter to the editor regarding the harmful effects of limiting prescriptions from three months to one month is right on. I add my voice to her concern.
This recommendation was proposed by the Canadian Pharmacists Association (CPhA) and the government consented, resulting in a de facto policy. There is a link on the CPhA website to a one-minute PowerPoint presentation intended to support the association’s position for this recommendation. It is self-emulating and disingenuous.
The chief justification for the position is that COVID-19 results in “increased demands for medication.” This is probably so for select over-the-counter drugs such as fever reducers; indeed, these are the only drugs recommended in a CPhA patient handout. However, the claim of increased demand is not applicable to drugs prescribed for the treatment of chronic conditions such as asthma, epilepsy and hypertension, to list but a few.
The pharmacists cite altruistic motivation — to prevent hoarding and drug shortages. Hoarding is the accumulation of a commodity beyond one’s needs (think toilet paper). This cannot occur for prescription drugs, because the amounts are capped by the licensed prescriber. This prevents an individual from accumulating an amount of a prescribed drug greater than his or her needs.
Furthermore, the amount dispensed is monitored by Manitoba’s DPIN (Drug Program Information Network), an electronic online point-of-sale program that requires entry of each dispensed prescription by the pharmacist. It immediately identifies “hoarders,” thus enabling front-line pharmacists to employ preventive strategies.
Our pharmacare program uses this this tool to deny coverage for early requests of refills, proof that the system works.
There are no pandemic-induced drug shortages (other than that due to the hydroxychloroquine hysteria). Rationing all medications to prevent shortages of specific drugs is akin to using a sledgehammer to deal with a mosquito. There are systems that identify evolving shortages for particular medications; hospitals utilize these routinely to initiate mitigation strategies on a drug by drug basis, so if a particular asthma, epilepsy or hypertension medication is in short supply, focused interventions are initiated.
The downsides of this policy are obvious: increased cost to consumers (a 300 per cent increase in dispensing fees) and an increased requirement for social interaction.
Dispensing fees in Manitoba are capped at $30 (the highest in Canada) but competitive pressure results in the range of $11-13 charged by most members of the pharmacy chains. It is not uncommon for a senior to depend upon 10 or more prescriptions; at $12 each, this amounts to an increase in excess of $1,080 per year, and a minimum of a 300 per cent increase of social interactions (assuming the unlikely situation of refilling all prescriptions on the same day).
Whether or not it was the intention, this change has the effect of price gouging. It is cartel-like behaviour. In principle it is no different than well-documented incidents of industry collusion on the price of bread or the price of gasoline. What makes this more odious is that it is foisted upon us under the mirage of altruism — prevention of hoarding and shortages.
If pharmacists truly wish to be altruistic, they should forgo their 300 per cent increase by charging one dispensing fee rather than three. Moreover, a professional association has recommended a change in policy, citing ostensible benefit to society; however, it results in financial benefit for its members, thus placing the CPhA in a conflict of interest.
This illusion of altruism made it an easy sell to government. Likely, the toilet paper hysteria contributed to a climate of acceptance. Sadly, the downside has a greater impact upon a vulnerable segment of the population — our seniors. Many routinely face economic challenges, and all are continuously advised to practise social isolation.
My title for this op-ed is intentionally provocative, an obvious attention-grabber. Now is the time for my apology to our policy-makers: in this time of crises with so many more pressing issues, I cannot find fault with the powers that be for not drilling down on this recommendation. Hopefully, with more light shed on this issue, our government will correct this harmful injustice.
Milton Tenenbein is a professor at the Max Rady College of Medicine, University of Manitoba. The opinions expressed are the author’s own and do not reflect the view of the University of Manitoba.