Weight Loss Medication Coverage Debate Continues: Is it In or Out for 2024

This month, we are pleased to share a recent update

from edHEALTH’s clinical pharmacy consultant, Jennifer Perlitch. She is also an Assistant Vice President of Pharmacy at Spring Consulting Group. In her blog, Jennifer explains several factors of weight-loss drugs and offers insights into safeguards for covering these popular and expensive medications.

Photo by Diana Polekhina

Current State

Weight loss medications, Glucagon-like peptide-1 receptor agonists (GLP-1RA)s, have risen in popularity beyond anyone’s imagination and there is no sign 2024 will be any different. Endorsements by top Hollywood celebrities, aggressive and compelling consumer marketing, new direct-to-consumer options, and research demonstrating their benefits related to both heart and kidney disease, have left employers wondering if they should rethink their coverage choices.

Many employers have seen the impact on their budgets, adding, on average $15,000 annually per patient in pharmacy costs. It is common for employers to focus only on short-term impacts and fail to connect the benefits of weight loss to long-term healthcare costs and goals. On average, patients who are overweight may incur healthcare costs that are 50% higher than someone of a healthy weight. Is it time we shift our thinking and focus more on the long term? Is it possible that there is a subset of your population that would benefit from these medications? Would you reconsider your position if the right safeguards were in place?

The Bigger Picture

Did you know? ¹

• The National Institute of Diabetes and Digestive and Kidney Diseases, reports more than 42% of American adults are obese or severely obese, a rate that has almost doubled since 1980.
• Obesity is second only to smoking as a preventative cause of death in the United States.
• Every 5-point increase in BMI results in a 32% increase in risk of developing heart failure.

The American Medical Association (AMA), the World Health Organization (WHO), and other medical boards have recognized obesity as a chronic disease for well over a decade. It is a complex metabolic condition that is impacted by genetics, behavior, and environment. Obese individuals have too much fatty tissue stored as energy within their bodies and their ability to change the body’s response to excess fatty tissue is often unsuccessful despite great efforts.^{1 2 3}

Obesity’s role in the development and/or progression of many chronic diseases, such as type 2 diabetes, hypertension, cardiovascular disease, kidney disease, stroke, sleep apnea, osteoarthritis, and certain types of cancer, is well documented. A person with obesity has an 80-85% risk of developing type 2 diabetes, and cancers associated with excess weight contribute to 40% of all cancers. It is easy to overlook that obesity not only impacts the physical body but also a person’s mental health.

The CDC reports that more than 50% of adults diagnosed with moderate to severe depression who were also taking an antidepressant were obese. Overall, 43% of adults with depression were obese compared with 33% of adults without depression, and women with depression were more likely than men to be obese. This was true across all age groups among women and was also seen in men aged 60 and older.^{3 4}

To Include or Exclude

As we enter 2024, the demand for weight loss medications continues and is anticipated to increase since much of 2023 was plagued with drug shortages. Despite these shortages, the average employer saw double-digit increases in the GLP-1RA category which includes drugs for both diabetes and weight loss. Many employers continue to struggle, unable to justify unrestricted access and coverage for their members while striving to offer benefits that provide value and fair access.

As employers look for innovative ways to combat soaring healthcare costs, re-evaluating coverage of weight loss medications to a subset of members could be a critical piece of the puzzle. The International Foundation of Employee Benefit Plans (IFEBP) reports that 22% of employers in the U.S. currently cover prescription drugs for weight loss, and 32% offer weight management programs. Another survey showed up to 42% of employers were revisiting coverage for 2024 and beyond.^{5 6 3}

This year started off with somewhat of a curveball in this area, with Eli Lilly announcing LillyDirect, a direct-to-patient portal, allowing some patients to obtain its newly released drug, Zepbound (tirzepatide) for as little as $25 a month. LillyDirect uses the telehealth platform, FORM, where patients reach independent telehealth providers who can complement a patient’s current doctor or serve as an alternative care option. This news has been received with mixed emotions. Many obesity experts feel this is a long overdue service that improves access and addresses affordability concerns. Others feel this is another move by manufacturers to circumvent health plan sponsors and improve their market share. Many are calling for transparency between telehealth providers and the pharmaceutical company to rule out any conflicts of interest.⁷

If you are exploring adding weight-loss drug coverage to your plan, a critical first step is to ensure members are educated about these drugs, essentially demystifying the media hype. The truth is these drugs are expensive, have side effects, and cannot do the job alone. Inadequate education regarding the side effects and how to manage them has caused many people to stop therapy, resulting in wasted healthcare dollars. The medications must be part of a comprehensive program that highlights the importance of healthy food and physical exercise. Members need to understand their responsibilities and how they will be held accountable for demonstrating their continued commitment to the plan. It has been demonstrated that those who stop the drugs regain, minimally, 75% of the weight because long-term behavioral changes and/or healthy eating habits did not form.^{8 2 9 10 3}

Employers also need to find ways to monitor their financial interests, such as/for example as follows:

1. They must be active participants in designing coverage criteria and ongoing monitoring parameters.
2. They must ensure they create a comprehensive approach, complete with a robust clinical review and ongoing monitoring at frequent intervals to evaluate a member’s response to therapy. As part of that, employers need to recognize the importance and impact that social determinants of health and health equity have when discussing weight.
3. Determine ways to implement opportunities for members to access healthy food choices and physical activity and add additional wellness incentives to your benefit offerings.
4. Be sensitive to the views/ or needs of your employees; do not make the out-of-pocket expenses so significant that they essentially restrict access.
5. Finally, monitor your financials closely, request frequent in-depth reporting, and hold your PBM accountable for ensuring appropriate coverage/monitoring, access to competitive pricing, rebate incentives, and formulary placement.

Conclusion

Ultimately the choice to cover these medications is an organizational decision, but it’s critical to have all the information necessary to make this decision, starting with a robust view of your population demographics. With high rates of obesity for most health plan sponsors, a prudent and thoughtful approach to expanding weight-loss coverage will be required. Attempts like this to tackle the obesity epidemic could produce long-term savings with lower overall healthcare costs, prevention of progression of existing diseases, and, most importantly, a better quality of life and employee experience. It has also been demonstrated that many people would remain at a job solely to retain coverage if offered and approximately 44% of people surveyed reported that coverage of these medications could be an important decision point in whether to accept a new position.^{11 4 12 13 14 6 8}

No matter your decision on offerings, the more you can offer through communications and education will help your plan participants make informed decisions and understand their role in achieving and keeping weight off. To realize tangible results, all parties must be committed.

1  https://www.cdc.gov/obesity/data/adult.html

2 Obesity Statistics. The European Association for the Study of Obesity.

3 Public Health Considerations Regarding Obesity. StatPearls

4 https://www.hsph.harvard.edu/obesity-prevention-source/obesity-consequences/health-effects/

5 https://ir.accolade.com/news-releases/news-release-details/glp-1-coverage-employer-plans-could-nearly-double-2024

6 https://www.cdc.gov/nchs/products/databriefs/db167.htm

7 https://investor.lilly.com/news-releases/news-release-details/lilly-launches-end-end-digital-healthcare-experience-through

8 https://icer.org/news-insights/press-releases/icer-publishes-evidence-report-on-treatments-for-obesity-management/

9 https://www.webmd.com/diet/obesity/obesity-health-risks

10 https://www.npr.org/sections/health-shots/2023/01/30/1152039799/ozempic-wegovy-weight-loss-drugs

11 https://jamanetwork.com/journals/jama/fullarticle/2812936

12 https://www.ama-assn.org/press-center/press-releases/ama-urges-insurance-coverage-parity-emerging-obesity-treatment-options

13 https://www.milliman.com/en/insight/payer-strategies-glp-1-medications-weight-loss

14 https://www.niddk.nih.gov/

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As featured in . . .

Thank you, Captive Intelligence, for talking with Tracy Hassett, President and CEO, and David White, CFO/COO, about what's next for edHEALTH and edRISK. You can read their interview here.

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