Medicinal Cannabis Coverage – Which type of coverage is best for your business?
There is a range of options that allow companies to add medicinal cannabis coverage to employee benefits plans. While not all insurance companies are ready to offer this type of coverage, trends in the industry show that many providers are incorporating medicinal cannabis coverage as a plan add-on. Insurance companies are offering this coverage to employers in two distinct ways:
Through health spending accounts.
- As an expense under medical services and equipment.
Isn’t Medicinal Cannabis Just Another Drug?
Medicinal cannabis currently does not have a Drug Identification Number (DIN), which causes insurance providers to categorize it under medical services and equipment and not under prescription drug benefits. Under this category, insurance providers offer coverage with various yearly maximums, ranging from $1,500 to upward of $6,000 per covered employee.
Uncapped Options Are Already Available
Recently, GroupHEALTH partnered with Zenabis to introduce the No Max Medicinal Cannabis Program, allowing employers to offer coverage to their employees with no yearly maximums and no predetermined conditions. For more information on the No Max plan, check out this resource. Valid medical documentation is required from the employee for both of the above coverage options.
What About Health Spending Accounts?
Another option to consider for benefits plans with cannabis coverage is the inclusion of a health spending account.
Because medicinal cannabis qualifies as a medical expense under the Canada Revenue Agency guidelines, individuals are eligible to expense their medicinal cannabis (with valid medical documentation) to their health spending account – as long as they acquire their medicinal cannabis supply in accordance with the Access to Cannabis for Medical Purpose Regulation (ACMPR). This means that individuals need to register with an authorized medicinal cannabis supplier to fill their requirements.
Better Advice = Better Benefits
Business owners considering this coverage should speak with your insurance broker or advisor. Employee benefit plans constitute a considerable part of overall compensation and have become a key retention tool with unemployment levels being low in Canada, and thus have a significant cost associated with them.
Licensed advisors can help you understand the financial impact and provide information that will help you to make an informed decision on whether medicinal cannabis coverage is right for your employees and your company.