Canadian mail order braces for Medicare plan

November 7, 2005

While American pharmacies are bracing for the onslaught of Medicare Part D, Canadian mail-order operators are worrying that their first and best customers may be lured away by the siren song of the new prescription drug benefit.

While American pharmacies are bracing for the onslaught of Medicare Part D, Canadian mail-order operators are worrying that their first and best customers may be lured away by the siren song of the new prescription drug benefit.

Since American seniors are the target customers of Canadian mail-order pharmacies, the industry is mulling over how the Medicare Rx benefit will impact their bottom lines, according to Andy Troszok, president, Canadian International Pharmacy Association. He said that there are too many unknowns to put a number on the table, including the fact that seniors using the Internet to buy their drugs are savvy consumers who have done their homework.

The Canadian mail-order pharmacy party line is that while the Medicare Rx benefit may help some seniors, the industry still has a role to play in helping seniors find affordable drugs. Each prescription drug plan (PDP) will have its own formulary so seniors might find their drugs are not covered. In addition, there's the infamous donut hole during which beneficiaries have to pay for their drugs out of pocket until their drug costs hit $5,100.

American seniors who are in touch with their Canadian pharmacies generally either say that they plan to give Medicare a try or that they're very confused about the program, said Troszok. "It's too complex," he said. "How do you make a decision when you don't have the formulary so you don't know whether your drugs are covered? And a drug might be covered in January, but the plan could pull it off the formulary whenever it wants, leaving beneficiaries high and dry."

Medicare Part D will have an impact on Canadian operations, but that doesn't mean anyone should count the industry out, said Troszok. "Canadian mail order will play a niche role, especially for under-65 consumers," he said. "More and more working Americans are finding themselves without drug coverage or reduced benefits. That's leaving a lot of people in difficulty and they're coming to us."