TORONTO — Sun Life Financial Inc. is adding medical marijuana coverage as an option for its group benefits plans, signalling an insurance industry shift and growing acceptance of the drug that bodes well for Canada’s burgeoning cannabis sector.
The Toronto-based insurer’s president and chief executive Dean Connor said the move was influenced by rising interest from Sun Life’s employer clients.
“Medical marijuana has become a very important part of their treatment program and pain management program,” said Connor, referring to patients who have cancer, multiple sclerosis, rheumatoid arthritis, or those requiring palliative care.
Currently, the vast majority of registered patients must pay for medical marijuana out of their own pockets. But the move by Sun Life, which provides health benefits coverage to more than three million Canadians and their families, or one-in-six Canadians, could set a precedent for other insurers.
The new offering comes as the country moves to legalize cannabis for recreational use later this year and as the number of registered medical marijuana patients grows. There were more than 235,000 medical marijuana patients in the system across Canada at the end of September 2017 — the most recent date for which data is available — more than double the roughly 98,500 a year earlier, noted Vahan Ajamian, a Beacon Securities Ltd. research analyst.
“The insurance companies have been getting pressure to cover this as a regular medicine,” he said.
Meanwhile, pharmacists and pharmacies have also been warming up to cannabis.
Shoppers Drug Mart has lined up supply agreements with licensed producers, conditional upon Health Canada’s approval of its application to dispense the drug. The Canadian Pharmacists Association and two Quebec groups representing the industry have also said that pharmacies should play a leading role in medical marijuana’s distribution.
Jonathan Zaid, the executive director of patient advocacy group Canadians for Fair Access to Medical Marijuana, said Sun Life’s enhanced coverage comes after years of litigation to gain acceptance for medical marijuana.
“Although there may not be immediate benefit for patients as specific plan sponsors will need to purchase the coverage, this move will make covering medical cannabis simpler than today’s exception process and speaks volumes to the broader acceptance and legitimacy of medical cannabis,” he said.
A number of plan sponsors have moved to cover medical cannabis costs over the years, Zaid noted, including the University of Waterloo’s student union, the Arthritis Society, Loblaw Companies Ltd., the Ontario Public Service Employees Union (OPSEU), and the Labourers’ International Union of North America. Those plans have varying eligibility criteria and levels of coverage, he added.
Starting March 1, plan sponsors with Sun Life will have the option to add medical cannabis coverage to extended health-care plans, ranging from $1,500 to $6,000 per covered person per year.
Medical cannabis coverage will be available for specific conditions and symptoms associated with cancer, rheumatoid arthritis, multiple sclerosis, HIV-AIDS, and palliative care.
In order to qualify for coverage, Sun Life plan members must meet specific criteria including an authorization letter from a physician and registration with a medical marijuana producer licensed with Health Canada.
Sun Life will also conduct periodic reviews of the growing body of clinical research supporting the use of medical cannabis for other conditions, and update its criteria if necessary, the company said in a document updating their client base of 22,300 plan sponsors.
Although this coverage does not encompass the full range of conditions and it is unclear how many businesses will use it, the insurer’s new offering is a positive development for Canada’s licensed medical marijuana producers, said Ajamian.
“Anything that makes it easier/cheaper for patients to get access should result in more patients, more volume, and (especially if it’s free) potentially more pricing power for producers,” he said in an email.
Manulife Financial Corp., one of Canada’s biggest insurers, offers medical cannabis coverage to clients on a selective basis, a spokesperson said.
“Manulife is supportive of clients that want to consider introducing medical cannabis as an option,” the spokesperson said in an emailed statement. “We also recommend that clients put limits and some management controls in place as this is an emerging market that is quickly evolving.”
As acceptance among insurers and employers appears to grow, a landmark battle over coverage of medical marijuana that helped add to the public conversation remains in the hands of the Nova Scotia Court of Appeal.
In October 2016, ThyssenKrupp Elevator Canada elevator mechanic Gordon Skinner went before the province’s Human Rights Tribunal over his union’s denial of coverage for his prescribed medical marijuana. The Nova Scotia man was injured in a motor vehicle accident in August 2010 while working, and was later prescribed medical cannabis to help with chronic pain. In January 2017, the tribunal ruled that the Board of Trustees of the Canadian Elevator Industry Welfare Trust Fund discriminated against Skinner, and ruled that his employer must cover medical marijuana.
The union took the case to the Nova Scotia Court of Appeal last fall, and Skinner is now awaiting the final ruling, said his counsel Hugh Scher.
Scher is optimistic about the outcome and noted Sun Life’s new offering is “a very positive development in the sense of recognizing the efficacy of medical marijuana, and attempting to provide for a means of enabling employers and insurers to address that need.”
Companies in this story: (TSX:SLF, TSX:MFC)
Armina Ligaya, The Canadian Press, Feb. 15, 2018.
‘We are going to see more of that’: Insurer must cover man’s medical marijuana, human rights board says
Keith Doucette, The Canadian Press | February 3, 2017 10:01 AM ET
A human rights board has determined a Nova Scotia man’s prescribed medical marijuana must be covered by his employee insurance plan, a ruling that advocates say will likely have impact nationwide.
Gordon “Wayne” Skinner, of Head of Chezzetcook, suffers from chronic pain following an on-the-job motor vehicle accident, and argued that he faced discrimination when he was denied coverage.
In a decision Thursday, inquiry board chair Benjamin Perryman concluded that since medical marijuana requires a prescription by law, it doesn’t fall within the exclusions of Skinner’s insurance plan.
Perryman ruled the Canadian Elevator Industry Welfare Trust Plan contravened the province’s Human Rights Act, and must now cover his medical marijuana expenses “up to and including the full amount of his most recent prescription.”
“Denial of his request for coverage of medical marijuana … amounts to a prima facie case of discrimination,” the ruling states. “The discrimination was non-direct and unintentional.”
Deepak Anand, executive director of the Canadian National Medical Marijuana Association, said the ruling is significant and could see a number of people apply for coverage through their provincial human rights commissions.
“If they could start to use this avenue to try to get their employers or insurance providers to start covering it, I think that’s going to be significant and we are going to see more of that,” said Anand.
Anand said he knew of one other instance where an insurance company agreed to cover medical marijuana — for University of Waterloo student Jonathan Zaid in 2015.
In the Nova Scotia decision, Perryman said the marijuana was medically necessary for Skinner.
“Since the medical marijuana in this case was prescribed pain management, it seems there is prima facie support for its medical necessity, owing to the fact that conventional prescription pain management drugs are normally eligible for coverage.”
Anand said the reasoning is “significant on its own” because many private and public insurers don’t recognize cannabis and marijuana as a medicine.
I’m elated, I’m still in shock it’s really still sinking in to be honest with you
“They (the inquiry board) are finally recognizing that prescription has some value, which so far the Canadian Medical Association and others have decided not to look at,” he said.
The ruling states the medical marijuana must be purchased from a producer licensed by Health Canada or a person legally authorized to produce for Skinner under the Access to Cannabis for Medical Purposes Regulations. The claim must also be supported by an official receipt.
Skinner, a former elevator mechanic with ThyssenKrupp Elevator Canada has been unable to work since the August 2010 accident.
“I’m elated, I’m still in shock it’s really still sinking in to be honest with you,” Skinner said in a telephone interview from his home outside Halifax.
He argued his own case before the board last October after being denied coverage three times, and said he hoped the inquiry board’s ruling would set a precedent.
“Hopefully this will help other people in similar situations and eliminate the fight that myself and my family have had to endure and the hardship that this has resulted in.”
Perryman found that Skinner’s chronic pain has been under-managed as a result of the denial of coverage, resulting in “profoundly negative effects on the complainant and his family.”
He also found that the plan’s justification for non-coverage was “wholly inadequate.”
“There was no evidence presented to suggest that premiums would have to be increased or that the financial viability of the plan would be threatened,” he wrote.
The Canadian Life and Health Insurance Association wouldn’t comment on Skinner’s case, but said in general it’s up to employers to decide if they want to cover medical marijuana under their group medical plan.
“We do not anticipate any impact on group benefit plans as each plan is unique, but will be reviewing the ruling,” the association said in an email.
For his part, Skinner said the human rights ruling has lifted a large weight from his shoulders.
“Just to have that security of knowing that these medications that are absolutely necessary for me to have any functionality are going to be provided for, just alleviates so much stress and hardship on my family,” he said.