OCP Board Adopts Position on Closed Preferred Provider Networks 

Posted:Jul 8th, 2024
Read Time: 2 Min Read

At its July 8, 2024 meeting, the Ontario College of Pharmacists’ Board of Directors adopted the following position regarding the use of closed Preferred Provider Networks (PPNs) and other payer-directed care models: 

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. 

“We continue to hear concerns from patients and pharmacy professionals about the risks that closed PPNs pose to quality patient care,” said James Morrison, OCP Board Chair. “Any business model that restricts a patient’s choice of pharmacy violates our Code of Ethics and Standards of Practice and gets in the way of a pharmacy professional’s duty to put patient interests first. 

“This position statement clearly aligns with our zero-tolerance approach to business practices that compromise the ability of pharmacists and pharmacy technicians to deliver safe and effective care to their patients, and signals our intention to use our regulatory influence, and to partner with others as appropriate, to protect patients from harm.”  


At its March 2024 meeting, the Board considered the potential risks of PPNs and whether a regulatory response was necessary. It was clear that PPNs can negatively impact patient autonomy, equitable access to care and the patient-provider relationship and that these risks were not currently being addressed by other health system partners.  

At that time, the Board committed to a series of steps in response to these concerns, including adopting a formal position statement (above) and, longer term, proposing regulatory changes to Professional Misconduct and Conflict of Interest and Proprietary Misconduct regulations. 

The College continues to hear concerns from registrants and patients about these models. As part of our zero tolerance for business practices that compromise the ability of pharmacy professionals to provide safe and effective care for their patients, we are committed to a strong regulatory response that protects patient access and autonomy.   

For additional background and analysis on the issue of PPNs, please review the July 8 Board Meeting Materials, starting on page 166.   

About Preferred Provider Networks 

PPNs are contractual agreements between a specific payer (e.g., insurance companies, employers) and a group of providers (e.g., pharmacies) to provide services (e.g., dispensing prescriptions) to patients. There are two types of PPNs: 

  • Closed PPN: The payer sets the terms and conditions with a limited group of pharmacies and the contractual agreements are not transparent. 
  • Open PPN: Eligibility to join the PPN is broader and conditions to join are transparent to pharmacies. 

Regardless of whether it is an open or closed PPN, patients can choose a pharmacy outside of the PPN, but the patient must pay a higher co-pay or deductible for prescriptions. From a patient safety and quality of care perspective, closed PPNs have the potential to cause greater harm because they limit access and choice to a much larger degree than open PPNs.