The recent "Romanow" and "Kirby" inquiries into the Canadian health care system recommended a publicly funded catastrophic prescription drug insurance program to protect Canadians from potentially ruinous drug costs. While the Romanow commission was not specific about the nature of such a program, the Kirby commission recommended that household prescription drug expenses be capped at 3% of total household income, or 1,500perhouseholdmember,whicheverislower,withgovernmentpickinguptheremainder.Usingrecentsurveydataonhouseholdspending,weestimatehowtheprogramwouldassisthouseholdsofdifferentmeansandages,residingindifferentregionsofthecountry.Wefindthat,despitethefactthatseniorandlowincomenon−seniorhouseholdsaretheprimarybeneficiariesofprovincialgovernmentdrugplans,averagesubsidieswouldbeover4timeshigherforthesehouseholdsthanforallother(non−senior,non−indigent)households.Asmallpercentageofotherhouseholdswouldbeamongthelargestbeneficiariesoftheprogram.Programbenefitsaretypicallylargerinprovinceswithlessgenerouspubliccoverageandtendtobenefitlowerincomehouseholds.Programcostsareestimatedtobeatleast461 million annually, although reductions in out of pocket drug spending will reduce medical tax credits and thereby increase tax revenues by at least $80 million. Program costs appeared to be very sensitive to increased household drug spending that might result from the program introduction.drug insurance; prescription drug expenses
The recent "Romanow" and "Kirby" inquiries into the Canadian health care system recommended a publicly funded catastrophic prescription drug insurance program to protect Canadians from potentially ruinous drug costs. While the Romanow commission was not specific about the nature of such a program, the Kirby commission recommended that household prescription drug expenses be capped at 3% of total household income, or 1,500perhouseholdmember,whicheverislower,withgovernmentpickinguptheremainder.Usingrecentsurveydataonhouseholdspending,weestimatehowtheprogramwouldassisthouseholdsofdifferentmeansandages,residingindifferentregionsofthecountry.Wefindthat,despitethefactthatseniorandlowincomenon−seniorhouseholdsaretheprimarybeneficiariesofprovincialgovernmentdrugplans,averagesubsidieswouldbeover4timeshigherforthesehouseholdsthanforallother(non−senior,non−indigent)households.Asmallpercentageofotherhouseholdswouldbeamongthelargestbeneficiariesoftheprogram.Programbenefitsaretypicallylargerinprovinceswithlessgenerouspubliccoverageandtendtobenefitlowerincomehouseholds.Programcostsareestimatedtobeatleast461 million annually, although reductions in out of pocket drug spending will reduce medical tax credits and thereby increase tax revenues by at least $80 million. Program costs appeared to be very sensitive to increased household drug spending that might result from the program introduction.drug insurance; prescription drug expenses
Canadian household prescription drug expenditures are studied using different years of the Statistics Canada Family Expenditure Survey. Master files are used, expanding the number of available years and permitting provincial rather than regional identifiers. Nonparametric Engel curves are estimated. Difference-in-difference mean and 80th percentile regressions examine budget shares by low-income and high-income households before and after the introduction of provincial prescription drug programs. The evidence is consistent with the view that unlike senior prescription drug subsidies, nonsenior prescription drug subsidies are probably more redistributive than an equal-cost proportional income transfer.Prescription drug benefits; incidence
Canadian household prescription drug expenditures are studied using different years of the Statistics Canada Family Expenditure Survey. Master files are used, expanding the number of available years and permitting provincial rather than regional identifiers. Nonparametric Engel curves are estimated. Difference-in-difference mean and 80th percentile regressions examine budget shares by low-income and high-income households before and after the introduction of provincial prescription drug programs. The evidence is consistent with the view that unlike senior prescription drug subsidies, nonsenior prescription drug subsidies are probably more redistributive than an equal-cost proportional income transfer.Prescription drug benefits; incidence