By Tim Witchell
Recreational marijuana will soon take its place next to medical marijuana in being legal in Canada.
It’s raising a host of interesting questions over such issues as whether this will pressure more employers to cover medical cannabis in their benefits plans, how comfortable (and when) insurers can get with pricing its risks, and if increasing competition will drive down the cost of medical marijuana.
Currently, Canada’s largest pharmacy chain, Loblaw Companies Limited and Shoppers Drug Mart, is perhaps the best-known employer to cover medical cannabis in its benefits plan. Its coverage is for a maximum of $1,500 annually, and only for claims related to multiple sclerosis symptoms and pain, and chemotherapy side effects in cancer patients.
A different, less restrictive approach has been taken by the LIUNA Local 625 union in Windsor. By including medical marijuana products in its benefits plan, Union 625 is hoping to encourage doctors to prescribe cannabis oil instead of opioids.
Other employers are also considering the coverage – mainly medium and larger organizations that are self-insured. Those that offer Health Care Spending Accounts (HCSAs) already are medical marijuana eligible unless specifically excluded by the employer.
Insurance companies themselves have resisted including the drug as an eligible expense under traditional benefits, citing the lack of a drug identification number (DIN) as a major reason. Recently, Sun Life Financial became an important exception and signaled an industry shift in announcing that medical marijuana was being added to its group benefit plans effective April 1, 2018.
In addition to the DIN issue, however, many insurers are struggling with lack of historical data with which to predict how to price the risk of medical cannabis.
It’s a complicated predicament for some of the more safety-sensitive sectors like construction. Marijuana’s comparative safety vis a vis prescription opiates and benzodiazepines, though, may cause some of those perspectives to shift. In fact, medical marijuana conceivably could replace other pain management prescriptions – as LIUNA is trying to encourage.
Another factor that might offset the risk concerns is that recreational marijuana users are looking to get high. But those who use it medicinally want to take just enough to manage their symptoms, typically taking only a fraction, or 10 percent, of what recreational users do.
And then there’s the cost issue. While the cost impact of its inclusion as a benefit under employer-sponsored plans isn’t known, some suggest that medical marijuana itself will be cheaper than the recreational drug. Plus, it is considered an eligible medical expense for tax purposes when purchased under a prescription and there’s lobbying to exempt medical cannabis products from sales tax.
Medical cannabis has been legal in Canada since 2001. As marijuana in general becomes more mainstream and shows itself, medicinally, to be a viable option to opioids, employers and insurers will need to take a hard look at how to adapt their human resources policies and benefits plans.
HUB International’s team of brokers to available to help your organization consider medical marijuana and other evolving employee benefits issues.
the one minute takeawayMedical marijuana has been legal since 2001 in Canada, but as the doors open to recreational use, pressure is building for employers to add it to their benefits plans as a reimbursable medical expense. It’s also pushing insurers to rethink their current and future medicinal cannabis risk positions.