Drug reimbursement rules run up against privacy issues

In an effort to keep a lid on the cost of prescription drugs, Canada Post and the Canadian Union of Postal Workers agreed on a two-tier system of reimbursement. Under the base plan, prescriptions would be reimbursed at 80 per cent. Under the plan listing supplementary drugs, the reimbursement was only 50 per cent.

Both parties had already agreed that if an employee needed a drug for life-sustaining purposes, or to combat the side-effects of a life-sustaining drug, and that drug was found only on the supplementary list, then the reimbursement would rise to 80 per cent.

What they disagreed about was the form doctors were asked to fill out to have their patients qualify for the higher reimbursement rate.

The union was concerned about protecting the privacy of those who were ill. It proposed a fairly sparsely worded form asking for only the medication’s name and drug identification number, the dosage and yes or no answers to two questions: whether the prescription was the only life-sustaining option available and whether it was a drug required to treat an adverse side-effect to a life-sustaining drug.

Canada Post, on the other hand, drafted a much more detailed form asking for the patient’s diagnosis and stage of disease, as well as an explanation as to why the doctor felt the drug was needed. In addition, the employee would be asked to sign a broadly worded permission to release this information to almost any organization or individual asking for it.

Also, the request for reimbursement at the higher level was to be renewed annually. Since the employees were already expected to pay for doctors’ certificates for other purposes, asking affected employees to foot the bill for renewing this request was not unreasonable, according to the corporation.

The union balked at what it saw as an unreasonable assertion of management’s rights. In its view, there were three elements to consider: the language of the collective agreement and the letter of agreement the parties had signed, the privacy issue, and the purely practical concern around making the existing drug card method easy and relatively inexpensive to use.

It objected to the idea that doctors were being asked to virtually justify their choices of medication, and that the insurer, Great West Life, seemed to be verifying or at least investigating the choice of drug. This was disconcerting, as pre-authorization to prescribe the drug was not required. The drugs were already on the approved list; the only question was the degree of reimbursement.

The post office argued that Great West Life needed assurance that the employee’s personal physician had considered all the appropriate information before making the decision to use the drug from the supplementary list. It referred to two decisions made by the Office of the Privacy Commissioner based on extended sick leave situations where no contravention of the federal Personal Information Protection and Electronic Documents Act was found. In its view, the additional requirement that employees sign the release was reasonable, not intrusive, especially as the forms in question were being submitted to the insurance company, not the employer.

The arbitrator disagreed with Canada Post’s stance.

In his view, the corporation’s proposed form represented “an unwarranted infringement at the crucial initial stage of an employee presenting a prima facie case for a bump-up” to the higher reimbursement level. That was not to say that future circumstances might not warrant having more information, but asking for it was not justifiable at the initial stage. The arbitrator objected to the overly intrusive nature of the corporation’s “insinuation into the prescription process.” It did not need to review a doctor’s reasons for prescribing drugs already on the approved list — at least not at the outset. As far as the arbitrator was concerned, neither the collective agreement nor the letter of agreement allowed this degree of oversight.

Asking an employee to sign a release of information form and requiring the person to re-submit the request annually only “magnified the degree of intrusion.” The requirements also went beyond the bounds of the wording contained in the agreement and the letter, said the arbitrator. He found that to automatically cut off the 80-per-cent reimbursement level if re-submission did not occur at the end of a year would be like simply picking a date out of a hat for no health-based purpose. Nevertheless, he acknowledged that the corporation could ask for justification at some future point but only if individual circumstances warranted it.

In conclusion, the arbitrator ruled that Canada Post could not use the form as drafted, nor could it require employees to re-submit requests after one year and to sign the omnibus consent form.

For more information: Canada Post Corporation and the Canadian Union of Postal Workers, a Canada Arbitration Board decision; Tom Jolliffe – Sole Arbitrator, Oct. 28, 2004.

Lorna Harris is the assistant editor of Canadian HR Reporter’s sister publication CLV Reports, newsletters that report on collective bargaining and other issues in labour relations. She can be reached at (416) 298-5141 ext. 2617 or [email protected].

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