A recent survey conducted by the International Foundation of Employee Benefit Plans revealed that coverage for weight loss medications, such as Wegovy and other GLP-1 drugs, is significantly lower compared to coverage for diabetes medications in employer-sponsored health plans.
According to the survey, while over 75% of employer-sponsored plans cover GLP-1 drugs for diabetes, only about 25% provide coverage for these medications when it comes to weight loss. Furthermore, a mere 13% of the surveyed employer plans expressed their consideration of covering GLP-1 drugs specifically for weight loss purposes.
These findings gain additional significance in light of emerging evidence highlighting the potential benefits of GLP-1 drugs in patients without diabetes. Novo Nordisk, a pharmaceutical company, recently released new clinical trial data demonstrating that Wegovy substantially reduces the risk of major cardiovascular issues in individuals who have had a heart attack, stroke, or peripheral-artery disease but do not have a history of diabetes. The American Medical Association (AMA) has also shown its support by announcing its intention to advocate for health insurers to cover weight-loss drugs approved by the U.S. Food and Drug Administration, including GLP-1 medications. Describing obesity as a disease of great concern in the United States, the AMA believes that coverage for these drugs is vital.
Upon examining the results of the employee-benefit foundation's survey, it becomes apparent that the primary factor influencing decisions on GLP-1 coverage is the link between obesity and chronic diseases, as well as the associated costs. However, only 27% of employer plans currently offer coverage for GLP-1 drugs intended for weight loss purposes. Although this figure has seen a slight increase since a previous survey conducted by the foundation in spring and summer 2022 (which reported coverage at 22%), it remains relatively low. The surveyed employer plans encompass a range of sizes, from fewer than 50 to over 10,000 active participants.
Employer-Sponsored Plans and the Coverage of Weight-Loss Drugs
Employer-sponsored plans in the United States are the most prevalent form of health insurance, providing coverage for almost half of the population, as reported by KFF, a leading health-policy research nonprofit.
One significant aspect that concerns many employers is the coverage of weight-loss drugs. The cost of GLP-1 medications and the uncertainty surrounding the duration of treatment have resulted in employers exercising caution in providing coverage for these drugs. Julie Stich, the Vice President of Content at the Employee-Benefit Foundation, explained that more than half of the employers surveyed considered long-term costs when making decisions about GLP-1 coverage for obesity.
The recent FDA approval of a new obesity drug called Zepbound from Eil Lilly & Co., with a list price about 20% lower than that of Wegovy's, may impact employers' decision-making process. Stich noted that the lower list price of Zepbound will certainly draw the attention of employers due to the significant role costs play in their decision-making process.
Consultants and pharmacy benefit managers might be influencing some employers' actions as they wait for recommendations regarding the coverage of these weight-loss drugs, Stich highlighted.
Additionally, many employers are adopting a wait-and-see approach, hoping that cheaper alternatives will emerge in the future. Current efforts by Lilly, Pfizer Inc., and other pharmaceutical companies to develop oral versions of GLP-1 drugs hold promise as they could potentially be more affordable and easily accessible compared to injectables.
For those employers covering weight-loss drugs, claims related to these drugs account for approximately 7% of the total claims in 2023, on average, according to the survey's findings.
