Revised November 2018
Do government programs and private benefit plans integrate?
In short, the answer is yes, however, depending upon the program “do I qualify?” may be the bigger question.
Many of my clients ask me this question, and there is not a straightforward answer. There are many programs
available through various levels of government, but for the sake of time and simplicity, I will only focus on the most utilized and often least understood. Several provinces have variations of these but will focus on Ontario’s programs as this represents the lions’ share of my audience.
Ontario Drug Benefit (ODB)
If you are a senior residing in Ontario, you will qualify. There are approximately 4,400 drugs on the ODB formulary. So any private plans with retirees or employees over the age of 65, should automatically qualify if the drug falls within the drug formulary.
Trillium Drug Benefit (TDB)
This is probably the program that most companies have confusion about and represents the largest potential financial upside to a private plan.
You qualify if you:
- Ontario resident
- Possess an Ontario Health card
And you are not covered under TDB as a:
- A senior over the age of 65
- someone who receives financial help through Ontario Works or the Ontario Disability Support Program
- a resident of a Long-Term Care home or Home for Special Care
- You don’t have private health insurance, or your private insurance does not cover 100% of your prescription drug costs.
This last point is the kicker for most companies. So if you have a drug plan that does not have a drug cap or pay 100% of the cost of the plan, you should qualify.
Insured plans that don’t have co-pays or ASO plans with a stop-loss provision do not qualify.
To access the TDB, the employee will still be required to pay approximately 4% of their net family income as a deductible.
The process is not without its challenges or inconveniences, but if utilized, can potentially save thousands of dollars for private plans.
Exceptional Access Program
This is for Trillium qualifiers who are seeking drugs that fall outside the ODB formulary. Essentially this is an appeal for approval of a speciality drug that is made on behalf of the patient by a medical practitioner. Same rules of Trillium apply.
Assistive Devices Program (ADP)
Any resident of Ontario with a long-term disability and a valid Health card. There is no restriction due to what one earns. The program usually pays 75% for the reimbursement of the following assistive devices. To integrate with a private benefit plan, the government must be stipulated as the first payer. The unpaid balance can be applied against a private plan.
CPP Disability versus private LTD coverage
To qualify for CPP Disability, the injury must be prolonged and permanently debilitating. There is very little probability of the individual being able to re-enter the workforce.
LTD coverage will assist individuals who are unable to re-enter the workforce due to injury in their current job or similar usually for the first two years (Own Occupation definition) but thereafter is required to enter another line of work or re-train for another position.
Generally speaking, CPP Disability is much harder to qualify for as it generally precludes that the individual is unable to re-enter the workforce. CPP is not considered a suitable alternative for LTD coverage. The payout amounts for CPP can be significantly less than an LTD pay-out.
Employment Insurance (EI) vs Short Term Disability (STD) coverage
EI is often considered the second payer to an STD benefit. However, they can often be integrated with EI. An STD “carve-out” will often be utilized in conjunction with EI. A “carve-out” plan will often pay STD for the first two weeks designated as the EI waiting period, EI will pay for 15 weeks or deemed eligible and then STD will often pick up coverage from the end of EI eligibility period until an LTD plan kicks in. An STD “wrap around” plan will function in the same fashion as a “carve-out” except if it is deemed the individual is ineligible for EI, the STD benefit will kick in. In both instances, an E.I. Premium Reduction is not allowed by the employer.
OHIP+ covers all babies, children and youth aged 24 and under who have OHIP coverage. Enrollment in OHIP+ is automatic, and eligible medications are covered at no cost. OHIP+ coverage stops on the patient’s 25thbirthday.
OHIP+ covers all drugs currently available through the Ontario Drug Benefit (ODB) program. This includes more than 4,400 drug products listed on the ODB Formulary/Comparative Drug Index and additional drugs eligible for funding through the Exceptional Access Program (EAP). Patients can use the medication coverage checker to check if a drug is covered under ODB. If a drug is not available through the ODB program, it is not covered through OHIP+.
The Doug Ford Tories announced in July 2018 that the current OHIP+ program would exclude all babies, children and youths that are currently covered under a private plan. The OHIP+ program will still exist for those that are not covered under a private plan or have drug plan limitations.
No official effective date has been announced for the OHIP+ revisions.
These are the most common benefits that can be integrated between private plans and government benefits. As you can see, having a specified knowledge of each and their limitations is paramount when setting up an integrated solution. Obviously, there is a lot more administration and education when integrating with a government plan, and this can be an onerous task for the employee and the employer. If a company can set up properly, to integrate between the two entities can save substantially for the private payer but is not without its challenges or obstacles for the employee or the plan administrator.
Revised November 2018