The use of marijuana for certain medical purposes has been legal in Canada for approximately 15 years. While the medical uses of marijuana and the regulation of its distribution are similar to the use and regulation of prescription drugs, medical marijuana is generally not covered by group drug benefit plans. Group insurance plans and the administrators of such plans take the position that only drugs which have a drug identification number issued by Health Canada are covered. Health Canada’s position is that it will not issue a drug identification number for marijuana because, “to date, scientific studies do not demonstrate conclusively that dried marijuana is safe and effective for medical use. … Consequently, dried marijuana has not been authorized as a therapeutic product in Canada or in any other country.”

Approximately 40,000 Canadians are currently authorized to use medical marijuana. It is somewhat surprising that no employee or union had, until recently, pursued a claim for reimbursement for medical marijuana from a group benefit plan to arbitration. Interestingly, the Ontario Workplace Safety and Insurance Appeals Tribunal has held in several cases that workers should be reimbursed for the cost of medical marijuana pursuant to the Workplace Safety and Insurance Act.

The issue of whether a worker is entitled to reimbursement for medical marijuana under a group health plan was recently addressed for the first time by an arbitrator. In The Corporation of the City of Hamilton and Hamilton Professional Firefighters Association, the grievor claimed reimbursement from the benefit plan for medical marijuana used by his spouse. His spouse had proper medical authorization for the use of the drug.

The collective agreement considered in the City of Hamilton award contained the following relevant provisions:

The employer shall pay the full cost of the premiums of the Canada Life extended medical plan, including semi-private coverage and drugs, for all employees…

Drug claims must indicate the prescription number, name, strength and quantity of the drug plus the drug identification number.

Drugs – Formulary 2 mandatory generic plan: drugs, serums, injectables and insulin (needles, syringes and test tapes for use by diabetics) purchased on the prescription of a medical doctor.

In order to lawfully use marijuana, an individual must submit an application with a “medical document” prepared by his or her doctor. Arbitrator Sheehan found that, while the required “medical document” is similar to a prescription, it is not a prescription. In the arbitrator’s view, the fact that the collective agreement only required coverage for drugs that are “purchased on the prescription of a medical doctor” supported the employer’s argument that marijuana was not covered in the arbitrator’s opinion.

The most important factor for the arbitrator, however, was that the parties had specifically agreed that the drug benefit plan would only reimburse employees for drugs which have a drug identification number. He found that wording to be determinative. Further, he accepted that there was a legitimate reason for insisting on a drug identification number because the existence of such a number demonstrated that Health Canada had approved the drug as being safe and effective. As marijuana does not have a drug identification number, the arbitrator concluded that the grievor was not entitled to reimbursement for the cost of the marijuana used by his spouse. Based on the specific terms of the collective agreement, Arbitrator Sheehan dismissed the grievance. However, the union reserved the right to advance arguments to the effect that the denial of reimbursement in these circumstances would violate the Human Rights Code or the Canadian Charter of Rights and Freedom. The arbitrator has yet to address the union’s arguments concerning the Charter and the Human Rights Code.

Analysis

As indicated above, a significant number of Canadians are already using medical marijuana. It is anticipated that the use of medical marijuana will expand significantly in the next ten years. If medical marijuana is covered by benefit plans, it would be quite costly. Marijuana coverage could result in significant premium increases which many employers would have to bear. The award in City of Hamilton provides some reassurance for employers that the cost of medical marijuana will not have to be borne by group health plans. However, the language in the City of Hamilton collective agreement is unusual. In particular, the reference to a drug identification number is not found in many collective agreements. Some collective agreements may include language concerning the drug benefit plan which could be broad enough to include medical marijuana. Employers should carefully review their collective agreements and related documents to identify any potential risks.