Sun Life Assurance Co. of Canada will become the first major insurance company to add medical marijuana to its group benefits plans for Canadian companies, a pivotal move in the insurance industry that will help ease the financial burden for medical-marijuana users, and a sign of the growing acceptance of cannabis in the Canadian workplace.
As of March 1, Sun Life will include medical cannabis as optional coverage under an extended health-care benefit plan. Sun Life, which administers group benefits plans for more than 22,000 Canadian companies, oversees health and dental coverage for more than five million Canadians – including dependents.
"We as a society are starting to see an interesting evolution over time," said Joan Weir, director, health and disability policy at the Canadian Life and Health Insurance Association. "The number of medical prescriptions that are being issued is growing at a substantial rate for medical cannabis and in turn that means a lot of plan members are now using it … so insurers are also watching this more closely."
Several years ago, life-insurance companies could deny coverage for clients who were occasional users of marijuana. In 2016, Sun Life was one of the first insurers to assess people who use marijuana when they apply for insurance as non-smokers. Now, life insurers are looking to add medical marijuana to their suite of covered benefits, easing the costs for users.
"Medical evidence supports the use of cannabis for some serious and severe medical conditions," Dave Jones, senior vice-president of group benefits at Sun Life, said in an interview with The Globe and Mail. "As this has become something our clients – being the individual companies known as plan sponsors – have been asking us about more and more, we have moved from the stage of evaluate and review, to now offering it as a benefit for medicinal purposes."
Individual companies will now be able to request the added coverage for their employees as well as choose a yearly benefit amount ranging from $1,500 to $6,000 a person.
The new medical-cannabis coverage will include a prior-approval process. Plan members or eligible dependents will only be covered if they meet the clinical criteria, as defined by Sun Life, and have their cannabis dispensed according to government regulations.
The debate as to whether the use of medical cannabis should be covered by an employee insurance plan has been a continuing one. Many employee benefit plans do not cover prescriptions for medical cannabis since it does not have a drug identification number (DIN) – something that insurance companies require in order for a drug to be covered and that are issued by Health Canada.
Several individual cases have emerged in front of the courts in order to determine an outcome.
In a landmark ruling last spring, Gordon (Wayne) Skinner went in front of a human-rights board after he said he faced discrimination from his employer when he was denied coverage three times through his work-sponsored plan. Mr. Skinner had suffered from chronic pain after an on-the-job motor-vehicle accident.
The board ruled in Mr. Skinner's favour, stating his employer must cover his medical-marijuana expenses.
A user of medical marijuana could pay several hundred dollars a month depending on the size of the prescription. For some patients, a portion of cost involved with using medical cannabis was being offset through health-care spending accounts. But not every company offers these accounts, leaving many without any supplemental coverage for cannabis prescriptions, said Chris Gory, an insurance adviser with Insurance Portfolio Financial Services who specializes in group benefits plans.
"The [added coverage] is a big game changer for many of my clients as only one in every eight offer health care spending accounts within their plans," Mr. Gory said. "Now, Sun Life is opening the door for many Canadians who really need access to this type of coverage. Not only is this going to help drive down pain for a lot of patients, but it is also going to help drive down drug costs for companies."
For those companies who choose to add coverage, there is a limit to what medical conditions will be approved. The coverage will be available for employees who are using cannabis to treat cancer with severe or refractory pain; or with nausea or vomiting associated with cancer treatments, multiple sclerosis with neuropathic pain; or with spasticity, rheumatoid arthritis with pain that failed to respond to standard therapy, HIV/AIDS and for patients requiring palliative care.
Sun Life said it will conduct periodic reviews of evolving clinical evidence, supporting the use of medical cannabis for conditions not listed. As well, plan sponsors can submit prior-approval requests for other conditions that Sun Life will examine on an individual basis.
The cost of adding the coverage takes into account a number of factors, but initially Sun Life does not expect it to rise, Mr. Jones said. In the beginning not every company will opt to include the additional plan; as well costs will be kept minimal, for now, as a result of Sun Life confining coverage to five specific conditions and symptoms.
For other providers, coverage appears to be done on a case-by-case basis. Manulife Financial Corp. offers similar coverage on a selective basis today, but has not offered it as an automatic selection for plan sponsors.
"Manulife is supportive of clients that want to consider introducing medical cannabis as an option," a Manulife spokesperson said in an e-mail. "We also recommend that clients put limits and some management controls in place as this is an emerging market that is quickly evolving."