Here's how to get GLP-1 drugs covered by employer health insurance

Los Angeles Times

6 hours ago

While the new anti-obesity medications known as GLP-1s are only one tool to combat obesity and cardiometabolic disease, they have changed the medical landscape and are clinically important in treating these diseases. Yet most Americans who have health insurance cannot get coverage for them.
For some, the only option has been to resort to compounded drugs for which the Food and Drug Administration has not assured the safety, and for which the main pharmaceutical ingredient is made in Chinese chemical factories without the quality standards of FDA-approved branded drugs. Even that inferior option is going away, as the FDA has declared that the name-brand drugs are no longer in short supply and so the off-brand drugs are no longer allowed.
President Trump recently called out 'the fat shot' when he told pharmaceutical companies to offer the United States the same pricing they offer other peer nations. He related a story of a friend in London who told him the price of GLP-1s there is about one-tenth of what it would cost in the U.S. The average listed price in the U.S. is more than $1,000 a month. In England, it is about $150.
There is not yet legislative authority to require pharmaceutical companies to sell prescription drugs in the United States at lower prices, but there is a straightforward way that these medications can become affordable to many in the United States.
Most employee health insurance coverage is through employer-sponsored plans, in which the budget is based on premiums contributed by both the employer and employee. Few plans provide coverage for any weight loss treatment, but if they did, it would have to fit in that budget — which would probably necessitate raising premiums.
Toxic fat is the cause of many cardiometabolic conditions, and GLP-1 drugs can help people reclaim their health. Improving access and affordability could be transformative for public health, given that about 88% of Americans are metabolically unhealthy. Increasingly, employees are telling their employers that they want access to these medications, and many employers would like to offer plans that cover them.
The brand-name manufacturers themselves provide a clue to how this could be possible. They offer their drugs directly to patients for around $500 a month. The sticking points? People whose employee-sponsored health insurance would cover even part of the cost of weight loss drugs are not eligible for that reduced price. Also, at $500 a month, even the discounted direct-to-consumer price still makes the drugs unaffordable to many.
Drug pricing in the United States is not transparent, and many entities get a share of the dollars that the health plans have budgeted. Simplifying the system with the GLP-1 drugs could make these drugs more accessible. Today, a drug bought from the drug company at $1,000 can include around a $300 rebate negotiated by a pharmacy benefit manager (working on behalf of the employer-sponsored health plan) and is often accompanied by a $150 manufacturer's discount coupon. The resulting price is similar to the around $500 price that drug companies offer directly to patients who don't have coverage for these drugs.
If we eliminate the rebates and coupons, so that manufacturers only charge employer-sponsored health plans the same $500 price they charge consumers directly, and then allow employers to contribute part of the cost (say $300 a month), we can get the out-of-pocket costs for employees close to the price at which these drugs are sold in other countries. It would be a rebate-free, coupon-free system with reasonable cost sharing by the employer.
The only reason that system of rebates even came to exist was to create enticements so certain manufacturers could persuade pharmacy benefit managers and employee-sponsored health plans to favor their drug over others'.
But in this case, where only two main drugs exist and both have publicly available clinical trial data that physicians can use to make informed prescribing decisions, rebates aren't needed. In reality, recent agreements between pharmacy benefit managers and drug manufacturers have prioritized financial interests over clinical appropriateness, determining drug preference based on what benefits the companies, not what's best for the patient.
Getting the price of the drugs to an affordable level would significantly remove one of the most despised aspects of the healthcare system — prior approval authorization. Doctors' offices are expending resources to get around barriers erected to limit the use of healthcare plan dollars on expensive medications for those the insurance plan and its managers determine do not need the drug, even when the doctors believe they do.
GLP-1s are highly effective for most people, but they also have some serious risks. We should leave it to doctors to make shared decisions with their patients about whether the risks outweigh the benefits.
To further create incentives for the pharmaceutical companies to reduce their prices and for employers to share in the cost of these drugs, the Trump administration should agree, as the Biden administration did, to cover them under Medicare. (Trump reversed that effort this year, barring Medicare and Medicaid from using them to treat the disease of obesity.)
This plan to simplify payments and expand access would not make all drugs affordable in the United States, but increasing accessibility to GLP-1s can get us on the road to eliminating the significant problem of cardiometabolic disease and improving our health.
David A. Kessler, a former commissioner of the Food and Drug Administration, is the author of 'Diet, Drugs, and Dopamine: The New Science of Achieving a Healthy Weight.'