On Friday, the Trump administration dismissed a plan proposed by Biden that would have mandated Medicare and Medicaid to cover obesity medications, thereby increasing access for millions.
According to the law governing Medicare’s Part D drug benefits, the program is prohibited from funding “weight loss” drugs. The Biden administration’s proposal last November sought to navigate around this restriction by asserting that the medications were intended for treating obesity and its related health issues.
Extending coverage for these medications was projected to cost the federal government billions, with estimates from the Biden administration suggesting an expense of approximately $35 billion over a decade.
The decision communicated on Friday was part of a comprehensive 438-page regulatory update that revises aspects of the programs through which beneficiaries obtain drug and private medical coverage. However, the latest update did not clarify the rationale for Medicare’s refusal to include these drugs.
Catherine Howden, a spokesperson for the Centers for Medicare and Medicaid Services, stated via email that the agency believes expanding coverage “is not appropriate at this time.” However, she added that the agency has not dismissed the possibility of coverage in the future and “may consider future policy options” regarding these medications.
Popular weight loss medications are produced by Novo Nordisk, marketed as Wegovy for weight loss and Ozempic for diabetes, and by Eli Lilly, which offers Zepbound for weight loss and Mounjaro for diabetes.
Medicare, which provides insurance for Americans over 65 and individuals with disabilities, currently covers these drugs for patients with diabetes and a smaller group of individuals who have both obesity and another health condition, like heart disease or sleep apnea. The Biden proposal aimed to broaden this coverage to include patients who are obese but do not have those conditions, with Medicare officials estimating that around 3.4 million more individuals could have opted for the medications under this policy.
Health Secretary Robert F. Kennedy Jr. has openly criticized the weight loss drugs, claiming they are less effective than maintaining a nutritious diet.
Clinical trials have shown that these medications can offer benefits beyond just weight loss, such as reducing the risk of heart attacks and strokes.
Supporters of expanded drug coverage contend that the government’s investment in these medications would eventually pay off. They argue that healthier patients would lead to fewer costly medical expenses, although it remains uncertain if these anticipated savings will materialize.
State Medicaid programs can currently decide whether to cover these drugs, and some have chosen to do so. Had the broader Medicare policy been implemented, coverage would have been mandatory across all states.
The obesity medications cost Medicare and Medicaid hundreds of dollars per patient each month, but the exact pricing is confidential.
Many employers and private insurance plans do not provide coverage for these drugs. Some plans, including those offered to state employees in North Carolina and West Virginia, eliminated coverage after the drugs gained popularity due to high costs.
Currently, Eli Lilly and Novo Nordisk offer their medications for $350 to $500 per month when paid out-of-pocket, though there was a time when patients had to pay upwards of $1,300 monthly.
In the absence of insurance coverage, many Medicare and Medicaid patients have relied on low-cost alternative versions of the drugs, manufactured through a process called compounding. These alternatives, permitted due to a shortage of brand-name products, can be priced below $200 a month. However, regulators have instructed pharmacies to gradually discontinue these alternatives as brand-name supply has improved.
Some House Republicans have shown interest in mandating that Medicare include the drugs in its coverage. This proposal was included as one of the potential policy options by the House Budget Committee earlier this year, but it does not seem to be a significant focus at present.
Novo Nordisk’s Wegovy will undergo price negotiations with Medicare this year. If no further changes occur, the government is expected to pay the negotiated lower price starting in 2027 only for patients who are both obese and have one of the other health conditions improved by these medications, potentially reducing the costs of long-term coverage.
