The College is concerned that the growing use of Preferred Provider Networks (PPNs) in Ontario can have negative impacts on patient choice, continuity of care and timely access to pharmacy services and ultimately pose risks to patient safety and well-being.
Our approach towards the use of PPNs is also connected to our work addressing business pressures in pharmacy practice that compromise the ability of pharmacy professionals to deliver safe and effective care to their patients. Read more on the Business Pressures in Pharmacy Practice page.
The Role and Risks of PPNs in Pharmacy Services
PPNs are contractual agreements between a specific payer (e.g. insurance companies, employers) and a group of providers (e.g. pharmacies) providing services (e.g. dispensing prescriptions) to patients.
In many cases, payers set terms and conditions with a limited group of pharmacies (often referred to as closed PPNs). These contractual agreements are not transparent and the invitation to join the agreement is not open to every pharmacy.
In other cases, the eligibility to join the PPN is open to all pharmacies who are willing to abide by the terms and conditions established by the payer (often referred to as open PPNs).
Regardless of the type of PPN, patients can choose to go to a pharmacy outside of the PPN. However, they may have to pay a higher price for their prescriptions (depending on the type of PPN agreement, the price could range from a higher co-payment/deductible to paying the entire cost out-of-pocket).
Any business model or agreement that restricts patient choice and access can create potential risks to patient safety and wellbeing, including limiting patient autonomy, increasing patient inequities and disrupting continuity of care.
Our Strategic Approach and Progress
The College’s approach to addressing the use of PPNs continues to evolve. PPN models were originally discussed by the OCP Board of Directors in 2018 before being brought back to the Board in March 2024 given the growing concerns about the impact of PPNs on patient care and choice.
In July 2024, the OCP Board of Directors adopted the following position statement:
Closed PPNs (and other payer-directed care models) pose potential risk of harm to patients, contravene established ethical principles guiding the profession and conflict with standards of quality patient care. As Ontario’s pharmacy regulator, OCP has zero tolerance for any payment or reimbursement models involving pharmacies and pharmacy professionals that put patients at risk, disregard patient autonomy, or that get in the way of a pharmacy professional’s duty to put patient interests first.
In line with the position statement, work continued to develop options for addressing PPNs through policy, including identifying several possible policy frameworks.
At the March 2025 meeting, the OCP Board passed a motion to defer deliberation and decisions related to PPNs until June 2025. This will allow the provincial government time to provide clarity on their approach and any actions they plan to take in relation to PPNs following the consultation completed by the Ministry of Finance last fall. For more information, please see the news post OCP Board Defers Regulatory Decisions on PPNs Until Government Approach Is Confirmed.
On May 15, the provincial government announced that it would launch another consultation on PPNs as part of the 2025 Budget. The College welcomes news of the government’s intention to host a second consultation given the ongoing concerns related to the impact of such models on patient choice and continuity and quality of care.
FAQs
A business model or agreement that limits patients’ choice of pharmacists and pharmacies can interfere with continuity of care and timely access to pharmacy services. Patients can be deprived of pharmacy care that meets their diverse needs, whether related to language, cultural safety or anything else that might factor into their choice of a health care provider. Where patient care may be compromised, the College is concerned.
Here’s an example: A patient has been receiving regular medications from their chosen local pharmacy for five years. But because their employer-provided health insurance has entered an agreement with a specific chain of pharmacies only, they must go to a different pharmacy in the next town to receive specialty medication. Now the patient needs to choose between splitting their prescriptions at different pharmacies (which can increase the risk of errors), switching everything to an unknown pharmacy that they can’t easily access or staying with their trusted pharmacy and paying extensive drug costs out of pocket.
No. The College cannot make laws or rules for the practices of employers, insurance companies or pharmaceutical manufacturers. As PPNs are established by employers who negotiate and purchase group benefit plans from third parties on behalf of their patients, we do not have any current ways to limit their use.
However, we are exploring a number of options to address our concerns and will focus on taking direct action where we have the authority to do so.
We also believe that business models that restrict patient choice are another example of business pressures being applied to pharmacy decisions that interfere with pharmacy professionals’ ability to deliver the kind of care they want to provide to their patients.