Many employers are facing challenges in incorporating high-cost GLP-1 medications, such as Mounjaro, Ozempic, Rybelsus, Trulicity and Wegovy, into their group health plans, as they must balance the cost of the group health plan against the interests of participants and beneficiaries in the treatment.
With prescriptions for these drugs cost around $1,000 a month, outlays for these drugs could eat up all the premiums paid for health insurance for an individual. While most health plans will cover these drugs for individuals who have diabetes and obesity, employers have been loath to cover them for employees who just want to lose weight due to the immense costs.
Despite that, employer spending on GLP-1s solely for obesity jumped nearly 300% between 2021 and 2023. And with demand continuing to increase, many employers are looking for ways to accommodate coverage for weight loss without breaking the bank. Here’s what some of them are doing:
Taking a holistic approach — One of the major drawbacks when taking a GLP-1 to lose weight is that once a patient stops taking injections, they often gain the weight back and any improvements in their blood pressure, blood sugar levels and cholesterol may disappear.
This is why more employers who are covering GLP-1s for weight loss are also requiring the employees to take part in holistic weight-management or lifestyle programs, like a dedicated exercise regimen and adopting a healthy and sensible diet. These lifestyle choices not only enhance the medication’s efficacy, but also support weight management, nutrient absorption, muscle preservation and overall health.
With this approach, patients have a better chance of maintaining their weight loss if they stop taking the drug.
Set conditions — Experts recommend setting certain conditions to qualify for a GLP-1 prescription solely for weight loss. This may include requiring that they have a body mass index of 33 or higher (anything over 30 is considered obese) along with one comorbidity like:
- High blood pressure,
- Chronic obstructive pulmonary disease,
- Diabetes,
- Heart disease, or
- Respiratory disease.
Setting a lifetime limit — Some employers and health plans cap the amount that they spend on a GLP-1 for patients who want to lose weight. Some set an expense limit like $10,000 or $20,000, while others have a time limit, such as two years.
Higher copays and deductibles — Another strategy is setting a higher copay for GLP-1s. Also, since these drugs are not included on the ACA preventive service list, plans may introduce a deductible for this category of prescription drugs, provided that GLP-1 coverage is not required for preventive diabetes services.
Remove Ozempic from formulary — Ozempic is by far the most popular of the GLP-1s thanks to media hype and word-of-mouth recommendations. This brand-name recognition has helped drive utilization up 75% between 2022 and 2023, according to the “IQVIA 2023 National Sales Perspectives” report.
Employers can ask their health plans to have their pharmacy benefit manager remove Ozempic from their list of covered drugs and opt for another GLP-1 like the lesser-known Trulicity, the utilization of which grew just 25% between 2022 and 2023.
Making a coverage change to a less utilized GLP-1 can reduce utilization, while preserving options for members with diabetes who need GLP-1s to remain healthy.
Have an alternate solution — Another option is to cover bariatric surgery, which yields better results. It typically costs between $10,000 to $15,000 — about the same as one year of most GLP-1 prescriptions. Most people who undergo this type of surgery have a much higher success rate of keeping weight off.
For example, the success rate of keeping weight off after bariatric surgery is 90%, according to the Cleveland Clinic. After this surgery, many patients steadily lose weight during the first two years after the surgery, after which the typical patient regains less than 25% of their weight. Most people who stop taking GLP-1s after losing weight cannot expect similar success in keeping their lost weight off.
Step therapy — Step therapy or fail-first programs are a medical management technique that requires the use of generally less expensive treatments before allowing coverage of higher-risk, higher-cost treatment options.
The takeaway
Currently, self-funded and fully insured group health plans are not required to cover GLP-1s for any purpose. However, because GLP-1s are a common form of treatment for diabetes, it may be difficult to exclude all GLP-1 coverage.
If a plan sponsor intends to provide GLP-1 coverage for weight loss, it may want to consider implementing medical management techniques to reduce claims exposure associated with GLP-1 coverage.
