Employers mull benefits coverage for weight-loss drugs after ‘exciting’ developments

Employers are questioning what Food and Drug Administration approval of glucagon-like peptide-1, or GLP-1, medications could mean for their health plans, according to recent survey data.

The past two weeks saw major developments in the GLP-1 drug world. First, the FDA approved Zepbound — already available to treat Type 2 diabetes under the Mounjaro brand name — for obesity treatment. Second, a clinical trial of Wegovy, which the FDA approved for chronic weight management in 2021, showed that treatment with the drug reduced the risk of cardiovascular disease, BioPharma Dive reported.

Amid the news, “we really kind of are at the early stages of everybody trying to figure this out,” Gregory Puig, VP of benefit consulting services at Sentinel Group, told HR Dive in an interview. Puig said various stakeholders in the employee benefits ecosystem, from insurance carriers to pharmacy benefit managers to drug manufacturers, are watching the marketplace to see what employers decide to do next.

Late October survey data from the International Foundation of Employee Benefit Plans showed that 13% of the 205 employer respondents said their plans did not offer coverage of GLP-1 drugs, but that coverage for weight loss was being considered. A slightly larger share currently covered GLP-1 drugs for weight loss purposes, and a majority, 76%, said they covered the drugs for diabetes.

In September, consulting firm Mercer published preliminary survey data showing that nearly half of employers with 500 or more employees covered GLP-1 drugs for obesity treatment and 19% were considering doing so.

Employers are currently mulling whether GLP-1 drugs will be dispensed to treat obesity more broadly or, alternatively, whether they will continue to be dispensed primarily to treat diabetes, Puig said. Wegovy’s potential cardiovascular benefits are noteworthy, he continued, but employers also want to know what treatment plans will look like for employees who take GLP-1 drugs.

“Do people have to be on this forever? Do they gain the weight right back if they come off of it? What are the long-term consequences if they take it for a long time?” Puig said.

He added that manufacturing and cost concerns are “the No. 1 thing for employers right now.” With healthcare costs increasing at a pace that is closer than usual to overall inflation, employers may not want to hike their claims without knowing the return-on-investment of members taking GLP-1 drugs.

Plan structure is another element to consider. Fully insured employers likely won’t be able to make the decision whether to cover GLP-1 drugs, Puig said, because they must instead wait for insurance carriers to make their own determinations. Self-funded employers, on the other hand, can create their plans as they see fit, but may not be willing to take on the liability of making the drugs more available.

Whatever choices plans make moving forward, there is considerable buzz in the medical community around the latest GLP-1 drug developments, Dr. Angela Fitch, chief medical officer at healthcare company Knownwell and president of the Obesity Medicine Association, said in an email.

“It is an exciting and pivotal time in obesity medicine and treatment, especially with the news that Wegovy can reduce the risk of heart attacks and strokes by 20% in adults with heart disease and obesity,” Fitch said. “Through this study, we are optimistic employers and insurers will see the real need to include these medications in their coverage plans, given the research shows the drug itself effectively reduces the risk of cardiovascular issues — rather than the previous speculation that it is a result of the weight loss that comes with it.”