Obesity Drugs Will Get Broad Commercial Coverage In 2025 Despite Cost Concerns, Survey Says

A strong majority of employers responding to the latest Business Group on Health health care strategy survey said they will cover GLP-1 drugs for obesity in their employee health plans in 2025.

BGH members who responded to the annual survey, which was fielded in June and July, included 125 large, self-insured employers spanning all industries.

Seventy-three percent of participants have more than 10,000 employees in the US and 68% are also multinational. In total the employers cover 17.1 million lives in the US.

Survey respondents were asked several questions about coverage policies for the GLP-1 drugs, which include Novo Nordisk A/S’s Wegovy (semaglutide) for obesity and Ozempic (semaglutide) for diabetes, and Eli Lilly and Company’s Zepbound (tirzepatide) for obesity and Mounjaro (tirzepatide) for diabetes.

Of the respondents, 67% said they are covering the drugs for obesity in 2024 and 3% said they were adding coverage for obesity next year. Another 13% indicated they were considering covering the drugs for obesity in 2026 or 2027.

Responses suggest spending on the GLP-1 drugs will accelerate with the addition of related indications. Nearly 40% of employers said they will cover the GLP-1 drugs for cardiovascular conditions in 2025, up from 34% in 2024.

Wegovy added an indication for protection against major cardiovascular events in people with obesity in March.  (Also see "Part D Plans Bracing For Wegovy; Strict Prior Authorizations To Prevent Obesity Use Are Likely" - Pink Sheet, 20 Mar, 2024.) And Lilly is planning to apply for FDA approval of tirzepatide in heart failure later this year. (Also see "Lilly’s Tirzepatide Shows Benefit In Heart Failure, Including Outcomes" - Scrip, 1 Aug, 2024.)

The survey shows employers anticipate broad coverage of the GLP-1 drugs despite significant concerns with their cost. Fifty-six percent of respondents said the treatments are driving health care costs to a “great” or “very great” extent. The next strongest drivers were “high-cost therapies,” with 46% of employers indicating they were responsible for an increase in costs to a great or very great extent.

Most employers (87%) reported relying on prior authorization requirements to manage GLP-1 drug use for obesity. Fifty-two percent require patients to participate in a weight management program as a condition of coverage and 51% have patient eligibility requirements for coverage, such as BMI minimums and/or comorbidities beyond the US Food and Drug Administration indication. Employers could choose more than one response on coverage policies in the survey.

Copay Maximizers And Other Cost Management Programs

Asked about managing their pharmacy benefit spend from the present through 2027, 55% of respondents reported using programs to “maximize manufacturer copay program benefits” in 2024. Another 4% plan to add the programs in 2025 and 13% are considering  them for 2026 and 2027. (See chart below.) In a copay maximizer program, patient cost sharing is set at the maximum value of manufacturer copay support programs. 

The US Centers for Medicare and Medicaid Services so far has resisted calls to restrict the use of copay maximizers in commercial plans governed by the Affordable Care Act. However, the agency has prohibited plans from designating certain drugs as non-essential health benefits, which had been used in maximizer programs as a first step toward tapping manufacturer assistance.  (Also see "Drug Cost-Sharing Limits Could Be Strengthened In Self-Insured, Large Group Plans In Upcoming Rule" - Pink Sheet, 3 Apr, 2024.)

Respondents showed substantial interest in implementing transparent PBM programs and cash pay solutions in 2026 or 2027, the survey found. Forty percent said they are considering implementing a transparent PBM program for and 21% said they are weighing programs that work with or match the prices of cash pay solutions like GoodRx and CostPlus Drugs.

Forty-two percent of employers said that new cost management programs offered by pharmacy benefit managers were already in place this year and 20% said the new programs would be added in 2025.

Payer Reliance On Rebates

However, the survey results also highlighted employers’ complicated attitudes towards rebates.

Fifty-six percent were “very concerned” about the lack of transparency in contracting and rebates and 50% said there is too much reliance on rebates in drug purchasing and formulary decisions.

But when asked what they get out of their partnerships with health plans and PBMs, rebates were designated as “very important” by 63% of employers and “important” by another 26%, which seems at odds with those concerns.

A recent study conducted by the National Pharmaceutical Council suggested that relying on rebates may be leading employers to ignore their adverse effects on patients.  (Also see "PBM Rebating Practices: How Much Do Employer Plan Sponsors Really Know?" - Pink Sheet, 29 Aug, 2024.)

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