Cost-effective health insurance protection
The industry pays out 87% of health insurance premiums
as benefits to policyholders (including funds set aside
for future benefits on disability and other longer-term
contracts), 7% for operating costs and 3% in federal and
provincial taxes. The remaining 3% is the average profit
margin.
Specialty drugs
The development of specialized drugs has also led to
a steep rise in drug costs. These specialty drugs, while
making up 2% of the total number of claims, made up
30% of prescription drug costs in 2015, and the costs are
expected to rise further in future years.
13
2015 health
benefits
$32.2B
Ext. health 75%
Disability 21%
Other 4%
Benefits by coverage type
$10.7B
Drugs
$7.8B
Dental
$3.0B
Paramedical*
& vision
Ext. health
$1.8B
Hospital
$0.8B
Travel
*refers to services and professions, such as
physiotherapy, that supplement and support
medical treatment
87% of premiums
paid out as benefits
(5-year average)
It is anticipated that more than 40% of
the cost of prescription drugs will be
from specialty drugs by 2020*
27% 30% 42%
2014 2015 2020
(estimated)
*Source: Drug Trend Report 2015,
Express Scripts Canada
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