Wegovy, a popular weight loss drug, has recently been approved in the U.S. for heart health. However, this approval may not immediately translate into wider insurance coverage for the drug. Many employers and health plans are hesitant to cover Wegovy due to its high monthly cost of $1,350 and concerns about the long-term effectiveness of the treatment.
Some insurance industry experts believe that the approval of Wegovy for heart health will prompt plans to reassess whether to cover the drug in the future. However, it is likely that coverage for weight loss drugs will remain a patchwork system, with some insurers choosing to cover them and others not.
Wegovy belongs to a class of drugs called GLP-1s, which help suppress appetite and regulate blood sugar. Coverage for these treatments for weight loss is already inconsistent, with approximately 50 million Americans having insurance coverage for weight loss drugs.
The Centers for Medicare and Medicaid Services is currently reviewing the expanded approval of Wegovy and will determine whether Medicare will cover the drug. State Medicaid programs, on the other hand, are required by law to cover FDA-approved medications, including Wegovy for its new cardiovascular use. However, only around one in five state Medicaid programs currently cover GLP-1 drugs for weight loss.
While some of the largest insurers, like CVS Health’s Aetna, cover weight loss treatments, many employers do not. A survey conducted by the International Foundation of Employee Benefit Plans found that only 27% of employers provided coverage for GLP-1s for weight loss compared to 76% for diabetes. However, 13% of employers indicated that they were considering coverage for weight loss treatments.
The recent approval of Wegovy for heart health highlights the significant downstream health benefits of weight loss drugs for severe conditions caused by obesity. Obesity increases the risk of various conditions such as diabetes, heart disease, and certain cancers. Health experts argue that covering weight loss drugs could reduce healthcare costs in the long run and improve health outcomes for patients.
However, employers have concerns about the long-term use and effectiveness of weight loss drugs. It is unclear whether patients need to stay on Wegovy for the rest of their lives or if they can eventually taper off the drug. Employers also have questions about longer-term data on GLP-1s for weight loss and whether patients will stop taking the drugs prematurely.
The cost of covering weight loss drugs is a significant factor for insurers and employers. The state of North Carolina, for example, has decided to exclude GLP-1s for weight loss from its insurance coverage due to the high cost. The state estimated that covering these treatments would lead to a $1.5 billion loss by 2030 and double premiums for all active employees and dependents on the plan.
In response to the high costs, drugmakers like Novo Nordisk and Eli Lilly have launched programs to help patients afford their weight loss treatments. Novo Nordisk offers a savings program that can save uninsured patients up to $500 per month. However, the list prices of weight loss drugs before insurance remain high, with Wegovy costing $1,349.02 per monthly package.
Increased competition in the weight loss drug market may lead to lower costs for these treatments in the future. Additionally, the development of cheaper oral versions of the drugs could make coverage more accessible. However, these options are still years away.
If more health-care companies implement cost control measures, such as spending caps or limits on spending increases, health plans may be more open to covering weight loss drugs. Currently, many employers use cost controls like step therapy or eligibility rules to limit coverage for weight loss treatments.
In conclusion, while the approval of Wegovy for heart health is a significant development, it is unlikely to immediately result in widespread insurance coverage for weight loss drugs. Many employers and health plans are concerned about the high cost and long-term effectiveness of these treatments. However, as more evidence emerges about the downstream health benefits of weight loss drugs and cost control measures are implemented, coverage for these treatments may become more accessible in the future.
