Can we afford not to pay for obesity care?

When you open up news relating to employee health benefits, GLP-1s are often in the headlines. For good reason. Here’s an obesity management solution that employees are clamoring for, as it’s too expensive for most people to cover on their own. Employers are feeling the pressure, wanting to provide meaningful benefits but also needing to ensure they are cost-effective and adding value.

Employers are in a tough place, struggling with rising health care costs due partly to the increasing cost of medications, including brand-name drugs for new indications, like weight loss. Next year, employers can expect to pay 5.4% to 8.5% higher health care premiums, and GLP-1s can potentially escalate these costs to untenable amounts.

Why? Because 43% of U.S. adults are classified as having obesity now, and nearly half the adult U.S. population is expected to have obesity by 2030. Even if a percentage of those who qualify for GLP-1s get them, it’s a high cost at $900-$1300 a month. Sure, some employers have access to lower negotiated prices, but they’re still paying $300-$700 a month per employee using it – indefinitely. One public health researcher estimated GLP-1s could increase U.S. health care spending by 50%.

Can employers afford to pay for obesity care? I think the better question is, can employers afford not to pay for obesity care?

Obesity’s cost and health implications

Due to associated serious comorbidities, obesity in the U.S. is calculated to be at least a $1.7 trillion disease, including $1.24 trillion in lost productivity and $480.7 billion in direct health care costs. And that’s before we reach the projected 50% adult obesity rate by 2030.

While there are serious financial implications to covering GLP-1s for weight loss, they’re eclipsed by the direct and indirect health implications. Obesity itself is a disease, but it is also a gateway to and exacerbates many other chronic health conditions such as heart disease, stroke and diabetes. Those with overweight or obesity have a higher risk for 13 types of cancer.

Offering benefits to address obesity is not just about the wellness realm, it’s about disease treatment. There is a direct relationship between reducing obesity and improving both population health and employer economics. Health care costs for a person with obesity average $1,861 in higher costs per year, compared to those with a healthy body weight.

Many companies have diversity, equity and inclusion (DEI) programs, and I would argue that treating obesity should be part of that initiative. Obesity disproportionately impacts non-Hispanic Black and Hispanic adults, and people experiencing poverty. Even when employed, not everyone can afford to pay for their treatments out-of-pocket, especially if they are as expensive as GLP-1s are.

For individuals, long-term, obesity will continue to exacerbate chronic disease if not managed properly. Employers are going to pay for these chronic conditions, and the absenteeism and loss of productivity that come with them.

Again, can employers afford not to pay for obesity care?

The current status of GLP-1 coverage

The American Medical Association recognized obesity as a disease a decade ago, and some private employers can and do offer treatment for obesity, understanding that obesity is a disease, not a moral failing.

Current estimates for employers covering GLP-1s for weight loss range from 25% to 46% this year, to 43% to 49% in 2024. Employers are figuring out what works for them. Bucking the trend, the University of Texas system, for example, had covered GLP-1s but stopped doing so, finding the cost was unsustainable. But GLP-1s should not be a standalone solution. Understanding obesity as a disease, and not just the focus of a wellness program or a target for GLP-1s, can help employers better frame the solution. Before diving straight into medications, employers can look at a multimodal approach.

There’s more to weight loss treatment than medication

GLP-1s shone a light on some of the issues involved with obesity, but treating it is by no means a new concept, and there are years of successes to draw on. What makes the most sense is a multimodal approach, based on the person’s needs and wants, and what is medically appropriate.

Bariatric surgery has been available for decades, with a strong safety and efficacy record. The costs are higher upfront, but surgery offers a more cost-effective solution than lifelong medication. Yet, even with high success rates and individuals who are healthier after surgery, only .5% of those eligible get bariatric surgery, and only 45% of employers cover bariatric surgery, similar to the figures for employers covering GLP-1s. Are we hitting some sort of treatment threshold?

Often termed “wellness programs,” 32% of companies cover weight management through programs that may include fitness challenges, nutritional counseling, health coaching, onsite gyms, and making healthy food available at work. These wellness programs are a great way to encourage people to get more active and eat healthier foods, but are not a comprehensive or particularly successful solution for people with obesity.

Multimodal treatment would include lifestyle approaches, like exercise and nutritional counseling, but could also include GLP-1s or other medications that can help with weight loss, and bariatric surgery. A comprehensive medically-monitored and directed approach can be more effective for employees in their weight loss and health improvement journey.

Can we afford not to cover obesity care?

No obesity treatment is a one-and-done fix, and employers need to understand the overall value of providing it. Spending money on medications, surgery or comprehensive programs is an investment, for sure. It’s important when considering such a program, how to do it the right way. Studies of past employer-sponsored weight-loss programs have had mixed results. Some have provided returns of up to $3.27 per every $1 spent, with savings in both health care costs and reduced absenteeism, while others provided a negative return. Adopting a program for the population and location can influence success rates.

People taking GLP-1s for weight loss likely need to stay on them indefinitely to maintain that loss. If they stop taking the medications, they are likely to gain the weight back, and with it, the health risks that come with regaining the weight. Studies show that a year after stopping GLP-1s, for example, people regain two-thirds of their prior weight loss. They also have negative cardiometabolic changes after ceasing the medications.

Those who undergo bariatric surgery also must continue monitoring their condition, whether through nutrition, counseling and other lifestyle approaches, and potentially with medications. Five years after surgery, people who underwent bariatric surgery maintained 12-17 lower BMI units on average. All-cause mortality is 16% lower after 40 years in those who undergo bariatric surgery compared to their peers who do not undergo the procedure. And mortality due to cardiovascular disease, cancer and diabetes was 29%, 43% and 72% lower in the surgical group, respectively.

Related: FDA approves Eli Lilly’s new weight loss drug Zepbound, cheaper than Wegovy

Access to weight loss treatment is important to employees, and 44% of people with obesity say they would change jobs to an employer that covers obesity care. Many employers do recognize the demand, with 81% of HR decision-makers saying their employees would be interested in this benefit, and 79% agreeing that GLP-1 coverage would help employee health long term. Employees would feel more valued with coverage – 77% of decision-makers agree that at least GLP-1 coverage would make employees feel they had a better health insurance package.

Next steps

While it’s possible for employers to put off decisions about obesity treatment coverage, the disease is not going away. The rates are only continuing to rise. Blocking access to affordable employee treatment may seem like a short-term employer savings, but we need to think about the longer term. And we need to think about addressing obesity through our DEI initiatives in a meaningful way, including through health equity.

There are, unfortunately, no quick fixes for obesity. People can exercise and eat healthier foods, and they’ll still be obese. The disease’s long-term impact will continue to exacerbate chronic conditions, having the potential to bankrupt us through rising costs of care. The time to develop a benefits plan to address obesity treatment is now.

We’re going to pay for it one way or another. Let’s pay for it by treating obesity.

Rajesh Aggarwal, MD, PhD, founder and CEO of twenty30 health