Employers once again face a rather expensive healthcare conundrum. The prevalence of so called “GLP-1 drugs”, prescribed ostensibly for weight loss, is causing many to question the cost versus benefit aspect of these drugs. GLP-1 drugs are showing promise at delivering on the goal of weight loss, but they have not been around long enough to evaluate their long-term side effects. And while demand for these drugs is definitely on the rise, they come at a very high price point.
GLP- 1 drugs, or glucagon-like peptide 1 receptor agonist, work by acting like a hormone that signals brain receptors affecting both appetite and food intake. There are two potential outcomes from these drugs: 1. Appetite suppression leading to weight loss; and 2. Slowing down the stomach’s emptying of food to the digestive track, making one feel fuller, longer. Currently there are three drugs on the market in this category – Wegovy, Ozempic, Rybelsus, Trulicity, Victoza, Saxenda, Byetta, and Mounjaro ranging in price from $8,000 – $20,000 per patient, per year. Readers of this blog post will likely recognize one or all of these drugs, due to extensive (and expensive!) advertising campaigns promoting them. (Note: Drug maker Eli Lilly recently (11/8/2023) gained approval of a weight loss management drug called Zepbound (tirzepatide) that is estimated to cost around $12,720 per patient, per year.)
Pharmaceutical consulting firm – Pharmaceutical Strategies Group (GSP) – conducted a survey of 180 health plan related stakeholders earlier this year (2023) and found some rather startling results. Here are some of the key findings:
It’s important to note that it wasn’t all that long ago that the medical community officially recognized obesity as a disease. (See –https://smstevensandassociates.com/obesity-is-now-officially-a-disease-2/. This would seem to rule out the widespread connotation that weight loss drugs like Ozempic are “lifestyle drugs”, as opposed to treating diagnosed disease states. That being said, the majority of health plans currently only provide coverage for GLP-1 drugs if there is a diagnosis of type 2 Diabetes. A diagnosis of Obesity alone, absent type 2 Diabetes, generally results in a coverage denial at the present time.
Vice President of Specialty Clinical Consulting at The Pharmaceutical Strategies Group (PSG) – Renee Rayburn – has some cautionary advice for those on the decision bubble about covering weight loss drugs. He says – “At this point, it is unclear if these medications will lead to sustained weight loss that delivers health benefits. From a health plan perspective, lifestyle resources (e.g., fitness program incentives, lifestyle coaching) are not as highly utilized but are the most effective for weight loss management. These medications are indicated for chronic use, thus covering them is not a short-term cost, for example, as it is with bariatric surgery frequently covered by employers”. And I would add that the referenced “fitness program incentives and lifestyle coaching” are included and fully covered by many commercial health insurance plans.
In conclusion, it seems employers and payers have essentially three choices with respect to insurance coverage for weight loss drugs:
Sources: Fierce Healthcare;June 14, 2023, Frank Diamond, The Pharmaceutical Strategies Group; and Cigna
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