It can be challenging to appreciate why insurers and pharmacy benefit managers (payers) require prior authorization (PA) for so many drugs, typically specialty drugs (drugs over $10,000 annually per patient).
Although specialty drug claims make up only a small portion of the number of total drug claims submitted under group benefit plans, specialty drugs make up an increasing amount of total drug claims and expenditure for employers and other sponsors of group benefit plans.
In 2025, both Express Scripts Canada and TELUS Health reported an increase in specialty drug spending.
Express Scripts Canada reported an increase of 15.7% in the percentage of members making at least one claim for a specialty drug and a 9.3% increase in the percentage of claims for a specialty drug.
TELUS Health reported that specialty drugs made up 32.8% of the total eligible amount, resuming an upward trek from 31.2% in the previous year. This followed two years of no growth, and even a slight decline in 2022. In 2022 TELUS Health predicted that specialty drugs would account for almost half of the average eligible amount per certificate. Recent trends for both adjudicators indicate that while significant, the total eligible amount for specialty drugs remains well below 50%.
The rising trend for specialty drugs can be explained by the increasing number of specialty drugs, and newly approved indications for drugs that target inflammatory, skin conditions, and cancer as well as the growing trends for TRIKAFTA, a high-cost drug for the treatment of cystic fibrosis.
It is common for insurers to restrict access to these drugs so that only plan members with a specific medical history, disease profile, or those who have tried and failed to respond to other less expensive therapies, have access to more expensive drugs.
Prior authorization is in place to ensure that the medication prescribed is necessary and appropriate, i.e., either there are no suitable lower-cost alternatives available, or all other lower-cost alternatives have already been explored. This ensures overall healthcare costs are managed and allows employers and plan sponsors to continue offering coverage for specialty drugs. Because the number of specialty drugs is increasing, the prior authorization process will become more commonplace and will apply to more drugs prescribed. Prior authorization is also used by public drug plans funded by provinces usually referred to as special authorization.
The drug you have prescribed to a patient is probably a specialty drug requiring prior authorization if one or more of the following applies:
If you are unsure if the drug you are prescribing or dispensing will require prior authorization, often insurance companies or pharmacy benefit managers (payers) will have a prior authorization drug list on their website for drugs that require prior authorization. Some may include the required claim forms that can be printed for your use, but others may not.
The Simplify Prior Authorization initiative is an advocate for education about prior authorization (PA) and improvement in current prior authorization practices and processes. If your organization is interested in finding out more, getting involved, or in sponsorship of this important initiative, please contact us via the link below.