The Centers for Medicare and Medicaid Services (CMS) announced on Friday that it will not proceed with a Biden administration proposal that would have expanded coverage for anti-obesity medications to millions of Americans enrolled in Medicare and Medicaid programs.
The decision, which comes shortly after Dr. Mehmet Oz's confirmation as CMS administrator, affects approximately 3.4 million Medicare beneficiaries and 4 million Medicaid recipients who would have gained access to these treatments under the proposed rule.
Policy Details and Implications
The Biden administration had proposed reinterpreting existing Medicare statutes to allow coverage for obesity treatments as a chronic disease intervention. Currently, Medicare is prohibited by law from covering drugs specifically for weight loss. The proposal would have also mandated that Medicaid programs could not exclude these medications when prescribed for obesity treatment.
CMS did not provide specific reasoning for halting the proposal but indicated in a statement that it may consider future policy options for anti-obesity medications "pending further review of both the potential benefits of these drugs including updated clinical indications, and relevant costs including fiscal impacts on stakeholders such as state Medicaid agencies."
The decision aligns with the Trump administration's stated focus on reducing federal spending. The proposed coverage expansion would have cost Medicare an estimated $25 billion over a decade, with additional costs of $11 billion to the federal government and $3.8 billion to states for Medicaid expansion.
Current Coverage Landscape
Despite the federal decision, access to these medications continues to expand through other pathways. Medicare currently covers GLP-1 medications like Wegovy for patients with heart disease to reduce the risk of cardiovascular events. The drugs are also covered when prescribed for diabetes management.
At the state level, 13 Medicaid programs already provide coverage for GLP-1 medications when used for obesity treatment, according to KFF, a nonprofit health policy research organization.
Financial Barriers to Access
The high cost of these medications remains a significant barrier for many patients. Wegovy, manufactured by Novo Nordisk, carries a list price of nearly $1,350 for a four-week supply, though various discounts are available. Eli Lilly's Zepbound is priced at more than $1,000, with starter doses available at reduced costs between $399 and $529.
"We're just back to the status quo, which is people on Medicare who need these drugs or want these drugs need to pay for them out of pocket," said Juliette Cubanski, deputy director of KFF's Program on Medicare Policy. "And given the high cost, that may be, for many people with Medicare, prohibitive in terms of access."
Administration Perspectives
The decision comes amid conflicting views within the Trump administration. Health and Human Services Secretary Robert F. Kennedy Jr. has previously expressed strong disapproval of these medications. Conversely, Dr. Mehmet Oz, the newly confirmed CMS administrator, has historically promoted anti-obesity drugs on his television show and social media platforms.
Clinical Context
The prevalence of obesity among Medicare enrollees has more than doubled over the past decade, with 22% of beneficiaries diagnosed with the condition in 2022. Proponents of expanded coverage argue that treating obesity could potentially reduce long-term healthcare costs by preventing complications such as heart attacks and other obesity-related conditions.
In the private sector, coverage is gradually expanding, with Mercer reporting that 44% of U.S. companies with 500 or more employees covered obesity drugs last year.
As the regulatory landscape continues to evolve, patients seeking these medications must navigate a complex patchwork of coverage options that vary significantly based on their insurance status, state of residence, and comorbid conditions.
