Insider
- Medicare is prohibited from covering new weight-loss medications like Ozempic.
- Lawmakers are looking for ways to make it less expensive for the drugs to get covered.
- Getting Medicare coverage could lead to other insurers also covering the medications.
Drugmakers and advocates are pushing for Medicare to cover a group of new weight-loss medications including Ozempic.
Medicare, the federal program that covers healthcare for people 65 and older, is prohibited by law from covering any weight-loss medications. And the new "game-changer" treatments can be expensive, with a price tag of about $900 to $1,300 per month. An article published in the New England Journal of Medicine in March estimated that if 10% of Medicare beneficiaries took semaglutide (known by its brand names Wegovy and Ozempic), the program would spend $28.6 billion.
The drugmakers behind the new medications stand to boost their sales if Medicare recipients gain coverage. Lawmakers who want to reintroduce legislation that allows Medicare to cover weight-loss drugs are looking for ways to lower the potential cost for taxpayers, The Wall Street Journal reports. That includes looking at programs that test out Medicare coverage and proposed limits to coverage, The Journal reports.
Getting Medicare to cover weight loss medications could have huge implications for whether these medications will be more widely covered by insurers, increasing access to more Americans.
Drug companies and advocates want coverage
Medicare has been prohibited from paying for weight-loss medications since 2003, when a law put weight-loss drugs in a category alongside treatments for hair loss, fertility, and erectile dysfunction.
The approval and rising popularity of new prescription drugs for weight loss, known as GLP-1 agonists, have drugmakers and advocates lobbying for that to change.
Novo Nordisk, the drugmaker behind semaglutide, spent $4.6 million on lobbying in 2022, The Journal reported. Other drugmakers developing treatments for weight loss like Eli Lilly, which makes tirzepatide, or Mounjaro, and Pfizer are also lobbying for Medicare coverage of obesity drugs, Stat News reported in January.
Drug industry-backed lobbying groups are pushing for coverage, as well as institutions like the NAACP and the Moffitt Cancer Center in Florida, Stat reported.
The organizations argue obesity is a disease, rather than a lifestyle problem, and can be treated as such.
"It should be something that everybody has access to, not just the lucky few who have an employer that decides to add it to coverage," Dr. Angela Fitch, the president of the Obesity Medicine Association and chief medical officer of Knownwell, told Insider's Shelby Livingston in March.
And there's a lot of money on the line. Analysts at Jefferies estimate sales related to obesity treatments for GLP-1 medications will be $100 billion by 2031.
The future of the $100 billion weight-loss drugs market
Expanding Medicare coverage to new weight-loss medications could drastically change how Americans access the drugs. If Medicare covers the obesity medications, private insurers may follow their lead.
While congressional staffers who spoke with The Journal said it may be unlikely Medicare expands coverage to weight-loss medications, Chris Gallagher, a policy consultant for the Obesity Action Coalition, an organization advocating for obesity treatment, previously told Insider he's optimistic about this type of legislation.
Until more insurance companies cover these drugs, however, insurance coverage of GLP-1 medications will likely continue to be piecemeal. Employers, which play a role in the healthcare coverage of more than 150 million Americans, are still grappling with how to cover the medications — some are covering them, while others are not. Medicaid, which provides health coverage for low-income people, can choose to cover the medications — but fewer than 20 states do, according to one report.
Meanwhile, other Americans will continue to go to Canada, Mexico, and unregulated online pharmacies to get the weight-loss medications for cheap.