Dive Brief:
Few Medicaid programs cover GLP-1 drugs for obesity as states grapple with the medications’ high cost, according to an analysis by KFF.
Thirteen programs for the safety-net coverage include the newer glucagon-like peptide-1 drugs for weight loss as of August 2024, the health policy research firm found.
Still, GLP-1 prescriptions and spending in Medicaid are increasing quickly. From 2019 to 2023, the number of prescriptions spiked by more than 400%, while gross spending soared by more than 500%.
Dive Insight:
GLP-1s currently make up a small portion of Medicaid prescriptions and spending before rebates are applied, but their share is growing. In 2023, GLP-1s accounted for 0.5% of prescriptions — compared with 0.01% in 2019 — and 3.7% of gross spending, an increase from 0.9% in 2019, according to KFF.
More Medicaid programs are interested in the drugs too. Half of states that didn’t currently cover the obesity drugs said they were considering adding coverage, according to the survey.
But growing drug spending and pressure on state budgets is a concern for Medicaid payers. Nearly two-thirds of respondents reported cost was a factor in their coverage decision.
Though relatively few states currently pay for GLP-1s for weight loss, all 12 programs that reported coverage as of early July implemented utilization controls, such as prior authorization or body mass index requirements.
But covering the drugs would expand access to a large swath of beneficiaries — nearly 40% of adults and 26% of children enrolled in the program with obesity.
Plus, reducing obesity could lower spending on other diseases in the long term, including heart disease, Type 2 diabetes and some cancers, the health policy research firm added. Four in 10 states reported that positive health outcomes and long-term savings on obesity-related chronic conditions are key factors in their coverage decisions.
GLP-1 coverage decisions for weight loss are weighing on other payers too. For example, relatively few employer-sponsored health plans cover the drugs, despite growing demand from their workers. Employers have already raised the alarm about GLP-1s’ contribution to rising healthcare costs. One analysis of large workplaces predicted a 7.8% increase in expenses next year, driven by higher spending on pharmaceuticals like GLP-1s.
