Starting in July, individuals with state health insurance who want to use drugs such as Ozempic and Wegovy from Novo Nordisk for weight loss will need to participate in a clinical lifestyle management program called Flyte. This program offers online resources for weight management and allows participants to meet with healthcare providers and receive custom care plans. These providers may prescribe the medications, which will be covered by the state health plan, or suggest an alternative treatment plan.

Scanlon stated that they never thought about eliminating the drugs, but they were aware that the current situation was not sustainable and alternative solutions needed to be explored.

The trial in Connecticut, which displays initial potential, arrives at a pivotal time for state and federal authorities grappling with the expenses of these groundbreaking treatments. If these therapies are approved, they could revolutionize treatment for millions of people in the US and become highly successful medications. About 40% of Americans are overweight and these drugs have been proven to effectively treat conditions exacerbated by obesity, including type-2 diabetes. They have also demonstrated the ability to decrease the risk of heart attacks and strokes in certain patients.

However, the treatments come at a high cost and patients may have to continue taking them for an indefinite period of time. In the United States, a 30-day supply of Ozempic costs nearly $1,000, while Wegovy is priced at over $1,300 for a one-month supply. The list price for Eli Lilly’s Zepbound, the recently FDA-approved obesity treatment, is slightly above $1,000 per month.

it may cover obesity-related services

According to regulations, Medicare is prohibited from providing coverage for weight loss treatments, but it does have the option to cover services related to obesity. with ties to the Trump administration in an effort to influence drug pricing legislation

Novo Nordisk has recently employed lobbyists who have connections to the Trump administration in order to impact legislation on drug pricing. to reverse that policy. Private insurance coverage is uneven, though on Monday the American Medical Association called on insurance companies to cover obesity medications, arguing that the long-term benefits and decreases in the need for other treatments will offset the drugs’ cost. For now, state Medicaid directors, public universities and state officials are just beginning to wrap their heads around who will pay for these drugs.

university system’s benefits guidebook.

The University of Michigan has raised copays for its employees, numbering around 120,000, from $20 to $45 in order to offset the expense of GLP-1 drugs. These drugs contain an active ingredient that is abbreviated as GLP-1 and the university’s health plan spent nearly $9 million on them for 1,076 members between July 2022 and June 2023. The copay will further increase to $75 on Jan. 1, according to the university’s employee benefits office.

Brian Vasher, assistant vice president for employee benefits and well-being programs at the University of Michigan, stated that GLP-1s are just one of several choices available for weight loss. The university encourages employees to explore more affordable options such as weight loss programs, preferred brand drugs taken orally, and generic medications before resorting to the more expensive GLP-1 agents.

According to Scanlon, the experiment in Connecticut, run by Intellihealth, is proving to be successful. As of November 3rd, 1,501 members of the state’s health plan have enrolled in Flyte. About 80% of these members have received GLP-1 prescriptions from their doctors. Additionally, the number of new prescriptions for these drugs is stabilizing, compared to the previous 50% annual growth in new scripts reported by the comptroller’s representative.

The state of Connecticut spends around $110 per month for every individual in the program. With the current amount of people enrolled, the yearly expense for Flyte is estimated to be $2 million.

The state will assess outcomes during a period of 10 months and gather input from employees before determining whether to continue a contract with Intellihealth for a longer duration.

Intellihealth’s CEO Sloan Saunders stated that their company adopts a thorough method towards addressing obesity. This involves healthcare providers evaluating various treatment options, including more affordable therapies, before resorting to prescribing anti-obesity medication.

According to Saunders, simply giving someone Wegovy and dismissing them does not lead to positive results.

Based on a KFF examination.

A representative from Novo Nordisk stated to POLITICO that there are differences in the coverage and payment provided by employers for medications related to obesity. Currently, around 50 million individuals with obesity have the opportunity to utilize this type of treatment, indicating a growing trend of increased coverage in both government and commercial healthcare plans.

Folwell stated that his team will investigate various methods for providing coverage for weight-loss medications in the coming months and is willing to consider options such as Flyte.

“We do not possess a complete control over good ideas in this world,” he stated. “Therefore, we are open to learning from other states that are also facing challenges due to price-gouging.”

As states struggle with the expenses of prescription drugs, telehealth initiatives such as the one implemented in Connecticut are gaining attention from employers who wish to provide coverage for weight loss medications without financial strain, according to Jeff Levin-Scherz, a population health expert at WTW insurance consulting firm. However, companies are still in the initial stages of evaluating their coverage policies and it remains uncertain how effective these programs will be in reducing costs and enhancing medical outcomes in the long run.

Levin-Scherz stated that the success of this strategy will be influenced by its effect on cost, clinical outcomes, and member satisfaction.

The Centers for Disease Control and Prevention reports that approximately 40% of Americans are classified as obese. Recent studies suggest that this number could increase to 50% by 2030, which could create a substantial market for obesity medications, according to Cynthia Cox, vice president at KFF. While bariatric surgery and other forms of obesity treatment can be costly, GLP-1s have the advantage of potentially being used for an extended period of time, according to Cox.

Reducing obesity can result in significant cost savings for healthcare, as it is linked to various long-term illnesses such as heart disease. However, these savings may not be apparent until years later when an individual is covered by Medicare or a different employer’s insurance plan. Essentially, private insurers may incur expenses for obesity treatment only to have government payers benefit from the outcome.

According to Cox, employers and health plans are evaluating the cost-effectiveness of when and if they will see a return on investment, and whether the enrolled individual will still be covered by the health plan at that time.

The National Association of Medicaid Directors’ executive director, Kate McEvoy, shared that state Medicaid directors are currently contemplating the possibility of providing weight loss drugs. Out of the sixteen states that offer coverage for these drugs, most have restrictions in place such as body mass index requirements or cost-sharing measures.

She noted that the significant increase in GLP-1s is similar to the success of hepatitis C drugs in 2016, which were priced at approximately $84,000 for a 12-week treatment. However, the hepatitis C drugs were able to completely cure the disease.

“While Medicaid programs will see offsets in the market price based on rebates from the manufacturers, it’s still a significant investment,” McEvoy said. “And it’s also harder than the situation with hepatitis C drugs to forecast short-term cost savings.”

According to Harvard University health care economist David Cutler, GLP-1s have the potential to become the top-selling drugs in the United States, surpassing the success of hepatitis C treatments. Cutler speculated that if the prices of GLP-1s decrease as more options become available, states may hold off on purchasing until the cost becomes more reasonable.

According to Cutler, although the drugs may be expensive, their potential for long-term health benefits and cost-savings could be significant. Therefore, states should take this into account when conducting cost-benefit analyses.

According to Cutler, the impact of drugs on patients’ health should be prioritized by states over any potential financial burden, particularly if the medications can prolong a person’s lifespan.

The speaker stated that some may question the need to pay for something they will not directly benefit from. However, the patients will ultimately benefit and any cost savings will go towards Medicare.