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Medical Cannabis – Making the Group Benefits Coverage Decision
Aon Insights

Medical Cannabis – Making the Group Benefits Coverage Decision


The recreational use and sale of cannabis has been legal in Canada since 17 October 2018. Medical cannabis has been legal for much longer. In fact, Health Canada has registered over 200,000 medical cannabis authorizations in nearly 18 years of legal medical use. This number is likely to grow as knowledge of the properties and treatment value of cannabis, and wider medical community acceptance increases.

Recreational legalization may lead to increased workplace risk and will test existing policies on alcohol and drug use. Requests for workplace accommodation related to medical cannabis may also increase, as will questions about how to manage such requests in general or in safety sensitive environments.

Recreational legalization could lead to employee questions about benefits plan coverage. Being able to distinguish between authorized medical use and recreational medicinal use in the benefits context will be to an employer’s advantage. Proactive employers want to have a ready response regardless of whether the final coverage decision is a yes or a no.

Outside of contractual obligations to the contrary such as the language of a collective agreement, employers are in no way obligated to make medical cannabis part of their employee benefits offer. It is important that their decision is informed, unambiguous, and based on a thorough examination of their workforce and benefits strategy.

Regulatory differences between medical and recreational cannabis

Medical Recreational
  • Legal since 2001
  • Highly regulated
  • Production and distribution federally regulated
  • Requires authorization by physician or nurse practitioner
  • May only be purchased from federally authorized distributors
  • METC eligible and benefits plan eligible
  • Strong clinical evidence for limited range of conditions
  • Legal on 17 October 2018
  • Highly regulated
  • Production federally regulated
  • Distribution/sale provincially regulated
  • May be purchased through public or private sales outlets, or a combination of the two, depending on the province
  • Neither METC nor benefits plan eligible

Why do the differences matter?

Only cannabis that is medically authorized and obtained through federal distribution channels can be covered under a Canada Revenue Agency compliant benefit plan. Most insurance carriers now provide medical cannabis coverage options and medical cannabis expenses can also flow through a Health Care Spending Account. Benefit plan sponsors are not required to provide coverage to their employees but can cover it if doing so compliments their benefit philosophy and helps to achieve workforce goals.

How can Aon help?

Aon offers a full Medical Cannabis – Benefit Plan Review to guide employers though the medical cannabis coverage decision making process. HR policies are reviewed in the context of medical cannabis and collective agreement obligations (if any) are noted. An analysis of recent drug claims is conducted in areas where medical cannabis may provide a strategic option. Employers are provided with a structured analysis of the issues that enables more informed decision making about group coverage. Knowing your options and deciding on a clear and defensible position regardless the decision made, prepares you for questions that might arise in your benefit plan or workplace.