Increasing number of employers covering GLP-1 drugs for weight loss, survey finds

About one-third of U.S. employer health plans now cover GLP-1 drugs for both diabetes and weight management, according to a recent survey by the International Foundation of Employee Benefit Plans. Coverage has increased significantly since last year:

• Fifty-seven percent provide coverage for diabetes only, up from 49% in 2023.
• One-third provide coverage for both diabetes and weight loss, up from 26%.
• Of those that currently offer coverage only for diabetes, 19% are considering offering the drugs for weight loss as well.

GLP-1 drugs promote weight loss by reducing appetite and causing the stomach to empty more slowly. First approved to treat diabetes, Novo Nordisk’s Wegovy and Eli Lilly’s Zepbound are in high demand after having been shown to reduce weight by around 20%. The biggest question surrounding GLP-1 drugs has not been their efficacy but who will pay for them. In the United States, the list price for GLP-1 drugs can range between $936 and $1,349 before insurance, rebates or other discounts.

Insurer resistance to covering the drugs is a limiting factor for sales growth for drugmakers, according to a 2023 report by Morgan Stanley. Of the 110 million Americans with obesity, 40 million currently can access GLP-1 drugs for weight loss through their health care plans, the report said.

Obesity’s association with chronic and higher-cost conditions, as well as consultant recommendations, were most frequently cited as factors for employers considering covering GLP-1 drugs, the report said. The most prevalent factors employers are taking into consideration for GLP-1 drug coverage for obesity care include:

• Obesity as a risk factor for chronic conditions and associated costs, 76%.
• Broker, consultant or pharmacy benefit manager recommendations, 71%.
• Impact and effectiveness of cost-control mechanisms, 62%.
• GLP-1 label expansion, 57%.
• Long-term costs, 56%.
• Lack of clinical studies for long-term use of GLP-1 drugs, 39%.

Related: Navigating GLP-1 insurance coverage with the right pharmacy benefits manager

Eighty-five percent of employers that cover GLP-1 drugs rely heavily on utilization management to control costs. These techniques include prior authorization and BMI and/or comorbidity requirements. Less common cost-management approaches include step therapy (18%) and eligibility requirements (16%). Nine percent of employers have no cost-control mechanisms in place.

“This new survey data show that in the last six months, GLP-1 coverage has increased for both weight loss and diabetes,” said Julie Stich, vice president of content at the foundation. “With the release of new FDA approvals and clinical studies, and increasing demand and awareness, employers are seriously considering how to proceed. The data indicate that employers and plans are adjusting their drug coverage policies in response.”