In the medical insurance and benefits sector, medical cannabis is becoming more mainstream. Last year, Sun Life Financial Inc. broke new ground when it became the country’s first major insurance company to offer coverage for medical cannabis to those with group benefits plans. And effective this year, the life insurance arm of SSQ Insurance began offering plan sponsors the option of covering medical cannabis.
Two factors convinced Sun Life to allow plan administrators to add medicinal cannabis coverage, says Cristina dos Santos, the company’s director of extended health care, product development and group benefits in Toronto. First, there was interest in and inquiries about the opportunity to offer employees coverage for medical cannabis. Second, there was sufficient evidence to support the use of cannabis as a medical therapy.
Two studies out of New Mexico, for example, found that patients experienced significant health benefits for everything from chronic pain to insomnia. In the United States, the U.S. Food and Drug Administration has approved three cannabinoids, the active chemicals in medical cannabis, as drugs for the treatment of epilepsy, weight loss in people with AIDS, and nausea and vomiting for chemotherapy patients.
In Sun Life’s case, the company covers use of medical cannabis for cancer with severe or refractory pain, nausea and/or vomiting due to treatments; multiple sclerosis with neuropathic pain or spasticity; rheumatoid arthritis with pain that has not responded to standard therapy; HIV/AIDS with anorexia or neuropathic pain; and patients requiring palliative care.
Healthy support from unions
Ontario Public Service Employees Union is among the unions that support coverage of medical cannabis, has a benefit plan
Unions are also major supporters of providing coverage for medical cannabis to members. In 2017, the Ontario Public Service Employees Union (OPSEU) rolled out a new benefit plan that provided medical cannabis coverage for insured OPSEU staff. Under the new benefit, insured employees and their spouses and dependants can claim up to $3,000 a year for medical cannabis. For claims to be eligible, they must be prescriptions from licensed physicians, and the cannabis must be obtained from organizations legally authorized to produce and sell medical cannabis.
One of those companies is Starseed Medicinal Inc. Last year, the subsidiary of Starseed Holdings, Inc. became the first medical cannabis company to sign a supply and service agreement with a union, the Laborers’ International Union of North America, to provide medical cannabis. “I don’t know of anyone else in the industry to go this route. We’ve created a relationship with the actual decision-makers,” says company president Angelo Tsebelis in Toronto.
Under the agreement, Starseed—which is poised to announce as many as five more partnerships with unions—facilitates access to medical cannabis by offering everything from an exclusive arrangement under the plan’s health benefits account to providing direct reimbursement (and then billing the insurer directly). “It’s really a service that we’ve created,” Tsebelis notes.
The first company to provide coverage under Sun Life’s plan was Aurora Cannabis Inc., the parent company of a licensed producer of medical cannabis. While the coverage made history in Canada, coverage should be the norm, argues Jonathan Zaid, director of advocacy and corporate responsibility with Aurora in Toronto.
“It should be covered like every other drug,” says Zaid, who broke new ground back in 2014 when, as a student at the University of Waterloo, successfully advocated to have medical cannabis covered for the first time in Canada as part of the student healthcare plan.
Medical cannabis charted different path
Legalization of recreational cannabis in Canada is helping to educate employers and address concerns
But medical cannabis is not like every other drug. It became legal after a number of court challenges and because it did not go through the standard Health Canada process for approving a drug, medical cannabis is not included on drug formularies because it doesn’t have a drug identification number (DIN).
Even so, says dos Santos, “this does not hinder access.” For employers, however, medical cannabis is atypical, she notes. “What’s unique about this are the safety concerns some employers have. Employers need to keep in mind if this [offering] aligns with their HR (human resources) policies.”
Companies like Starseed are lending a hand. “We’re working closely with insurance companies and advisors to see how they can help their clients and roll this out responsibly,” says Tsebelis.
The legalization of recreational cannabis is also helping to educate employers and address concerns, Zaid suggests. “The legalization generally has allowed for more open conversations around cannabis. It brings more comfort to those who had concerns about legality of coverage.”
But offering cannabis coverage is not for every company, cautions dos Santos. “First, consider if this is right for your employee base.”
In a paper on the issue prepared by Sun Life, the insurance company recommends employers ask—and answer—three key questions. Would adding medical cannabis coverage address a need in the employee base? Does the organization risk backlash if medical cannabis is not covered? Do the company have the communication resources in place to explain coverage details?
Zaid notes Canada is still in the early stages of providing coverage for medical cannabis. There are, for example, no public formularies that provide coverage primarily because there is no DIN allocated to medical cannabis, he says.
This should not be a barrier, says Zaid. “The University of Waterloo showed you can apply a pseudo DIN or (pseudo drug identification number) to allow for coverage,” he adds.