BIP Fall 2024

Voices

Employers weigh coverage of weight loss drugs Plan sponsors once again face a rather expensive healthcare conundrum. By Scott M. Stevens

Three choices Most health plans only provide coverage for GLP-1 drugs with a diagnosis of Type 2 diabetes. A diagnosis of obesity absent of Type 2 diabetes generally results in coverage denial. Pharmaceutical Strategies Group’s Renee Rayburn has cautionary advice for those on the decision bubble about coverage. “At this point, it is unclear if these medications will lead to sustained weight loss that delivers health benefits,” he recently told FierceHealthcare . “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.” It seems employers and payers have essentially three choices with respect to insurance coverage for weight loss drugs: 1. Cover these drugs with the hope and expectation that the result will be reduced healthcare costs. 2. Exclude coverage for these drugs, and instead take a “wait and see” approach to evaluate side effects and the cost versus benefit aspect. 3. Provide coverage subject to a strict set of protocols, similar to how weight loss surgery has historically been handled.

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 on weight loss, but they have not been around long enough to evaluate their long-term side effects. And they come at a very high price point. GLP-1 drugs, or glucagon like peptide 1 receptor agonists, 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. 2. Slowing down the stomach’s emptying of food to the digestive tract makes one feel fuller longer. Drugs on the market in this category (Wegovy, Ozempic, Trulicity and others) range in price from $8,000 to $20,000 per patient annually. You will likely recognize one or all of these drugs due to extensive (and expensive!) advertising campaigns promoting them. Additionally, drug maker Eli Lilly recently gained approval for a drug called Zepbound (tirzepatide), estimated to cost around $12,720 per patient annually.

Pharmaceutical consulting firm Pharmaceutical Strategies Group surveyed 180 health plan stakeholders in 2023 and found startling results: • Respondents differed on whether to consider these drugs as a “lifestyle issue” or treatment of a chronic condition. • 43% are providing insurance coverage for these drugs, while 28% indicated they may decide to cover them within the next 1-2 years. • 22% said they did not cover nor will they consider covering them. variety of companies devising customized, cost-effective and comprehensive employee benefit plans. Scott M. Stevens, RHU, CDHC, is a NABIP member, employee benefit broker and consultant at Dodge Partners Insurance. He works with a

TIP: It wasn’t all

that long ago that

the medical community officially recognized obesity as a disease. This would seem to rule out the widespread connotation that weight loss drugs are “lifestyle drugs,” as opposed to treating diagnosed disease states.

18 bip magazine Fall 2024