Employee Benefit Plans that Exclude Medical Marijuana are Not Necessarily Discriminatory, Court Finds

The Nova Scotia Court of Appeal has released a decision Canadian Elevator Industry Welfare Trust Fund v. Skinner, 2018 NSCA 31 overturning the Nova Scotia Human Rights Board of Inquiry’s decision that denial of coverage for the medical marijuana under a health benefits plan was discriminatory.

The employee that brought the application before the Human Rights Board was involved in a motor vehicle accident while working. The employee began consuming medical marijuana, which improved his condition significantly. Initially, medical marijuana was covered by the employer’s motor vehicle insurer, but the employee later reached the maximum limit of $25,000 of coverage offered under that insurance policy. The employee then requested coverage from the board of trustees of the union’s industry welfare plan. The trustees denied the request because 1) medical marijuana had not been approved by Health Canada under the Food and Drugs Act, so it did not have a drug identification number (“DIN”), and 2) the trustees determined that any medical expenses ought to be covered by a provincial medicare plan since this was the workplace accident.

The Human Rights Board found that the trustees had the authority under the Welfare Plan to interpret its terms in a way that would have made medical marijuana an eligible drug, to approve coverage for medical marijuana on a case-by-case basis even though it was not ordinarily covered, or to change the Welfare Plan to make medical marijuana an eligible drug. Therefore, the Human Rights Board found that the trustees of the Welfare Plan contravened the Act when they denied coverage for medical marijuana.

However, the Nova Scotia Court of Appeal overturned this decision finding that all such health plans necessarily have limited benefits for those with a disability. It could not be automatically discriminatory for the Trustees to impose reasonable limits on reimbursable benefits. The Court stated that Mr. Skinner experienced an adverse impact because the medications offered under the plan were not effective for him personally, not because he fell within a protected group described in the Human Rights Act. The Court found that to hold otherwise would mean that every exercise of discretion used by the trustees of a medical plan would become an act of discrimination.

Interestingly, the repercussions expected from this decision were so substantial that a medical cannabis producer said it would fund the insured’s defence of the appeal.

EKB’s Regulatory and Administrative team is experienced and knowledgeable in this area and can assist you further.