You may be wondering about the purpose of a statement that you are now provided with whenever you receive your group benefits renewal. It is a short EP3 document. What is the purpose of this statement?
The benefit carriers in Canada got together a number of years ago and created the Canadian Drug Insurance Pooling Corporation's program. It is the Extended Health Policy Protection Plan, or EP3 for short. All group benefit providers follow the standards for insured prescription drug plans.
The EP3 plan has great value to employers and employees alike. It spreads the risk of high drug claimers over the whole industry and not just to one employer.
There are 3 key principles that are addressed:
- Affordability
All group benefit plans that are fully insured should be able to access extended health care coverage at a reasonable price. No one company should see huge rate increases due to high usage of one or more of its workers or their dependents.
The pool charges are not solely based on your company's eligible drug claims experience above the pooling level. The pooling charges may be adjusted periodically based on the experience of the entire EP3 pool to which your company belongs.
2.Availability
All companies with fully insured drug plans in Canada should be able to buy group extended health care insurance from a benefit provider designed to meet the specific needs of their company.
No carrier in Canada will cancel your EP3 program, as long as your plan design and funding remain consistent with the plan principles and as long as your contract with the carrier remains active and premiums are current.
3.Transferability
All employers with fully insured drug plans will be able to select the participating group insurer of their choosing and not be bound only to their current insurer.
Large and regular high drug claims should not prevent them from moving their business from one carrier to another.
The newly-selected carrier is required to also cover your employees by their EP3. The new carrier is then also responsible to provide the employer with a new EP3 statement at each renewal.
If you have an ASO (Administrative Services Only) plan or another form of self-insurance, the EP3 statement will not be given to you. It is only for plans that have fully insured prescription drug coverage.
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