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Updated: Mar 9, 2021


  • Access to healthcare is based on the need rather than the affordability is the principle of the Canadian healthcare system.

  • The healthcare system in Canada is decentralised with the provisional and health insurance plans cover the services.

  • Services free of cost at the point of delivery

  • Canada has universal health insurance coverage.

  • Funding is provided by taxes

  • The co-payments made by the patients are quite less. Physicians get the payment based on the negotiation, and the budget is provided for the hospitals.

  • Medicare is the healthcare system in Canada.

  • There are ten provinces and two territories.


  • The provisional health plan is responsible for providing healthcare at the provisional level.

  • There is no out of pocket payments to the physicians.

  • Prescription drugs and dental coverage is covered by private insurance in Canadian healthcare.

  • Healthcare provider and insurer are directly involved in the exchange of the money. Ministry of health at the provisional level is responsible for regulating the prices.


70% of the healthcare expenditure funding is from the taxes. In the rest 30%, nearly half is out-of-pocket spending by the patients and the other half by the insurance companies.

The funding in Canada occurs at three layers

  • Layer 1: This includes public services including hospital, diagnostic, and physician services

  • Layer 2: This consists of public and private insurance coverage. Also contains out-of-pocket payment including outpatient prescription drugs, home care, and institutional long-term care

  • Layer 3: This includes completely private including the dental care, outpatient physiotherapy

Around 65% of the Canadian population have supplemental private insurance, which is used for the co-payment of outpatient prescription drugs. Some of the Canadian population do not have additional insurance; the majority of them are low-income Canadians.



Health Canada is the regulatory body responsible for the authorization of drug products into the market. Health Canada releases the

Pricing and reimbursement:

The Patented Medicine Prices Review Board (PMPRB): Involved in the price regulations for the patented products. PMPRB submits to the federal government, the details of drug prices, price trends, and costs of research and expenditure. PMPRB does not regulate generic prices.

The Canadian Agency for Drugs and Technologies in Health (CADTH): Body is funded by federal, provincial, and territorial governments. This body involved in providing the evidence-based information on the effectiveness of the drug and health technologies to Canadian healthcare decision makers. Key steps involved are

  • The Common Drug Review

  • Health Technology Assessment program

  • The Canadian Optimal Medication Prescribing and Utilization Service

Common drug review:

CDR accepts the drug submissions from manufacturers, will conduct a systemic review, takes the expert advice to make the formulary listing decisions.

The Canadian Expert Drug Advisory Committee (CEDAC) It is composed of experts, who makes the formulary listing recommendations based the scientific evidence and the clinical practice.

pan-Canadian Oncology Drug Review Process (pCODR):

Involved in the review of oncology products. Based on the recommendations from the Committee to Evaluate Drugs (CED) and the CED-Cancer Care Ontario (CCO) Subcommittee, provinces make their own decision.


The Common Drug Review (CDR) process:

A CDR submission allows the submission for all federal, provincial and territorial plans. The CFR accepts the submission of all patented products and combination products that are not approved earlier in Canada. The CDR process aims to provide the recommendations for the formulary listing to different plans. The recommendations are made based on efficacy and, scientific evidence.

Manufacturers submit the dossier to the CDR process.

The reviewing of the drug products is done by the internal reviewers, external and clinical experts. The drug manufacturer replies to the comments made by the CEDAC. The recommends of CEDAC are:

  • Be listed

  • Be listed with restrictions

  • Not to be listed at all

The recommendations are available on the CADTH website.

CDR does not review the oncology products. pan-Canadian Oncology Drug Review is involved in the reviewing of oncology products.

Ontario’s Rapid Review Process:

Ontario participated in both CDR and the pCODR processes. However, if the new chemical entity shows a significant effect and meets the unmet clinical need, the product might be eligible for the rapid review process. The Assistant Deputy Minister and Executive Officer, Ontario Public Drug Program decide on the listing of the drugs.


PMPRB is involved at the Federal level in deciding the pricing. It is responsible for patented products not to be priced heavily in Canada.

The drugs involved with the hospital setting are free of cost. Insurance plans reimburse outpatient prescriptions drugs. Federal, provincial, or territorial plans also cover vulnerable groups like geriatric patients. However, if there is no private insurance, the patient has to make the payment by out-of-pocket.


In Canada, because of the healthcare system is for free, it makes the system ineffective. The demand gets increased and hence, the overall cost. By medically necessary products, provisional healthcare providers are regulating the price.


1. Ridic G, Gleason S, Ridic O. Comparisons of health care systems in the United States, Germany and Canada. Mater Sociomed. 2012;24(2):112-20.

2. Image source:



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