The C.D. Howe Institute is urging the federal government to reconsider its plan for a single-payer pharmacare system. With tariff-related fiscal pressures mounting, the think tank argues Ottawa should focus on filling coverage gaps in the current public-private system instead of moving to universal coverage.
Quebec Model as a Template
Report author Rosalie Wyonch said Canada should “aim at universal coverage that is fiscally sustainable and uses the advantages of the mixed public-private system.”
She pointed to Quebec’s long-standing program, where residents without private insurance must join the public drug plan. The report also called for clearer communication from Ottawa on its long-term pharmacare policy.
Ottawa’s Unclear Position
Prime Minister Mark Carney has avoided firm commitments on a universal program. He has promised agreements with provinces and territories for the first phase but has not confirmed whether a full single-payer model will follow.
The Pharmacare Act, passed last October, commits Ottawa to work toward national universal pharmacare. Its first phase covers contraceptives and certain diabetes medications at low or no cost.
Costs and Funding Concerns
The Parliamentary Budget Officer estimated universal pharmacare could cost $39 billion annually by 2027–28, about $13.4 billion more than current spending.
Even the first phase faces challenges. Only Manitoba, B.C., P.E.I., and Yukon have signed funding agreements. These four jurisdictions account for over 60% of the $1.5 billion budgeted, but cover just 18% of the Canadian population.
Critics also note that the limited drug list means many patients cannot access the medications they need.
Shift in Federal Priorities
According to Wyonch, the Carney government has shifted away from health care priorities:
“Now we are dealing with tariffs, economic uncertainty, and a bigger focus on infrastructure and defence.”
Broad Agreement Among Stakeholders
The report was informed by an August policy workshop with industry leaders, insurers, government officials, academics, and former public servants. Wyonch said:
“This is the first time in my experience that the pharmaceutical and insurance industries have agreed on next steps.”
What’s Next
An expert committee is reviewing models for universal pharmacare and will submit recommendations to the health minister by October 10. The minister is expected to table the report in Parliament, shaping Ottawa’s next move on pharmacare.
