[vc_row content_width=”grid”][vc_column][vc_column_text]For insurers and administrators of employee benefit plans[/vc_column_text][/vc_column][/vc_row][vc_row content_width=”grid”][vc_column][vc_column_text]
Ed. Note: this information bulletin does not have the force of law. It represents the point of view of the Quebec Drug Insurance Pooling Corporation on various subjects, based on the Act respecting Prescription Drug Insurance.
[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column][vc_empty_space][/vc_column][/vc_row][vc_row content_width=”grid”][vc_column][vc_text_separator title=”The Compliance Certificate: What does it say, what does it mean and who should sign it?”][vc_column_text css=”.vc_custom_1461673608641{border-bottom-width: 1px !important;padding-bottom: 20px !important;border-bottom-color: #e4e4e4 !important;border-bottom-style: solid !important;}”]
The Quebec Drug Insurance Pooling Corporation ensures the sound management of the system of risk sharing (or pooling) developed by the industry. An important part of this work consists of obtaining information that makes it possible to verify the contracts submitted to pooling as well as the validity of any claim by an insurer or a benefits administrator for compensation.
In order to ensure that the information obtained is valid, the Quebec Drug Insurance Pooling Corporation requires participants to submit a Compliance Certificate. This bullein looks at the contents of this certificatem its meaning and the persons qualified to sign it.
[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column][vc_empty_space][/vc_column][/vc_row][vc_row content_width=”grid”][vc_column][vc_text_separator title=”A reminder”][vc_column_text]The first objective of the pooling process is to ensure accessibility to insurance coverage dsipite the risk of high drugs costs presented by some participants. The process is arranged so that the total amounts paid out as compensation under the system is equal to the total amounts collected. The succes of the process dependson the willing cooperation of all who participate in it.
The Quebec Drug Insurance Pooling Corporation (The Corporation) verifies the validity and accuracy of the information it receives for risk pooling from different participants. Among other things, this is done by requiring all participating insurers, third party administrators and administrators of employee benefit plans to complete and submit a Compliance Certificate. This Certificate attests that the groups presented for pooling were estblished and remain in compliane with the applicable laws, namely the Act respecting Insurance, the Act Respecting Prescription Drug Insurance (the Act), and their corresponding regulations.[/vc_column_text][eltdf_tabs tabs_layout=”eltdf-tabs-regular”][eltdf_tab title=”What must the Compliance Certificate contain? “][/eltdf_tab][/eltdf_tabs][/vc_column][/vc_row][vc_row content_width=”grid”][vc_column width=”1/2″][vc_column_text]When duly completed, the Compliance Certificate contains the following:
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In addition, the certificate contains the following declaration:
“For each certificate, we have declared the total amount of eligible drug costs reimbursed by our company during the year now ending. Where the contract number is not reported in our risk exposure, we have provided the additionnal information requested. We have not included any claim where we were invulved as second payer.”[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column][vc_empty_space][/vc_column][/vc_row][vc_row content_width=”grid”][vc_column][eltdf_tabs tabs_layout=”eltdf-tabs-regular”][eltdf_tab title=”Its meaning”][vc_column_text]
The need for a Compliance Certificate arises from the various risks surrounding the pooling process.
The first is the risk of manipulation of the data submitted to pooling. In order to prevent this risk and with a concern for fairness to all participants and the smooth operation of the pooling process, the Corporation introduced a policy in 2010 that allows it to perform an audit of data in a participant’s own offices. This audit involves a few participants each year and is done according to a predetermined schedule. Nevertheless, the Compliance Certificate remains an important control measure since, once signed, the participant’s responsibility is binding.
The Compliance Certificate also contributes to retaining the industry’s privilege of setting its own rules for risk pooling in drug insurance. Although they are developed to the satisfaction of insurers and administrators of employee benefit plans covered by the law, the terms and conditions of pooling must also, in order to be valid, be subject to annual review and be submitted to the Health and Social Services Minister by November 1 each year. This is stipulated in section 43 of the Act.
Thus, completed by participants in good faith using accurate information, the Compliance Certificate allows the Corporation to verify that participants are complying with the rules that are in place and helps diminish the risk of government intervention. Moreover, we must keep in mind that the government still retains the power to change or add rules to the industry’s pooling process as required. This can be called regulatory risk.
[/vc_column_text][/eltdf_tab][/eltdf_tabs][/vc_column][/vc_row][vc_row][vc_column][vc_empty_space][/vc_column][/vc_row][vc_row content_width=”grid”][vc_column][eltdf_tabs tabs_layout=”eltdf-tabs-regular”][eltdf_tab title=”The Compliance Certificate: an important declaration”][vc_column_text]In the Compliance Certificate, the participant confirms, for each group in question, that its practice conforms to the requirements of risk pooling, including the determination of group size according to the principle of joint and entire responsibility as to risk. In addition, the participant asserts that contracts linked by a financial tie requested by the policyholder have been combined into a single group and that contracts linked because of internal policies or decisions of the insurer or of a grouping set up by a duly authorised fe insurance representative (one holding a group insurance license) have been presented separately.
A Compliance Certificate that reflects a participant’s operations faithfully not only allows the Corporation to fulfill its mandate, it also makes it possible to justify the amounts collected or paid out during the compensation process.[/vc_column_text][/eltdf_tab][/eltdf_tabs][/vc_column][/vc_row][vc_row][vc_column][vc_empty_space][/vc_column][/vc_row][vc_row content_width=”grid”][vc_column][eltdf_tabs tabs_layout=”eltdf-tabs-regular”][eltdf_tab title=”Who should sign the certificate?”][vc_column_text]Because of the important information contained in the Compliance Certificate, only a person in authority, representing the participant, can sign such a document.
The person could be either a signing officer of a company or one of the directors. This person must be able to explain the information sbmitted for the pooling process and represent his or her company, either as debtor or creditor, at the Compensation Table.
The industry’s collaboration, including completion of the Compliance Certificate, is of the utmost importance. It is up to each participant to complete the Compliance Certificate and to communicate with the Corporation for any question concerning its content.[/vc_column_text][/eltdf_tab][/eltdf_tabs][/vc_column][/vc_row][vc_row][vc_column][vc_empty_space][/vc_column][/vc_row][vc_row content_width=”grid”][vc_column][eltdf_tabs tabs_layout=”eltdf-tabs-regular”][eltdf_tab title=”In the next issue”][vc_column_text]In the Corporation’s Information Bulletin No. 2011–8, read about “Drug lists and their management”.[/vc_column_text][/eltdf_tab][/eltdf_tabs][/vc_column][/vc_row][vc_row content_width=”grid”][vc_column][vc_empty_space][/vc_column][/vc_row]
