Starting in July, members of state health plans seeking weight-loss medications such as Novo Nordisk’s Ozempic and Wigovy will first have to participate in a clinical lifestyle management program called Flyte, which provides online tools for weight management. be. Participants will have the opportunity to meet with a healthcare provider and receive a personalized care plan. These health care providers may prescribe one of the medications covered by your state’s health plan or recommend another course of treatment.
“I had never thought about quitting drugs, but I knew the status quo wasn’t going to work and I had to look at other options,” Scanlon said. .
The Connecticut experiment, which is showing early promise, comes at a critical time for state and federal officials grappling with the costs of these breakthrough treatments. If approved, such treatments could transform treatment for millions of Americans and become some of the best-selling drugs of all time. About 40 percent of Americans are obese, and these drugs have proven effective in treating conditions worsened by obesity, such as type 2 diabetes. It has even been shown to reduce the risk of heart attack and stroke in some patients.
However, treatment costs are high, and patients may have to continue treatment indefinitely. His list price for a 30 day supply of Ozempic in the US is just under $1,000. For Wegovy, a month’s supply will cost him more than $1,300. Eli Lilly’s obesity drug Zepbound, which was approved by the FDA last week, costs just over $1,000 a month.
By law, Medicare cannot cover weight loss treatment, but Novo Nordisk recently hired a lobbyist To reverse that policy. Private insurance coverage is uneven, but the American Medical Association on Monday called on insurers to cover obesity drugs, saying long-term effects and reduced need for other treatments offset drug costs. . For now, state Medicaid leaders, public universities and state officials are just beginning to consider who will pay for these drugs.
“We have a fiduciary responsibility to not fail our programs based on the use of certain drugs,” said North Carolina Republican candidate to manage the state’s public health program for 750,000 employees. said Treasury Secretary Dale Falwell.
His office estimates that spending on these drugs could exceed $170 million in 2024 and jump to more than $1 billion over the next six years. To control costs, the state health plan will no longer cover these weight-loss drugs for new members starting Jan. 1.
The University of Texas System, one of the state’s largest employers with more than 116,000 workers, announced in September that drug costs rose from about $1.5 million a month to $5 million a month over 18 months. , insurance coverage for weight loss drugs was abolished.It ended in May, according to University system benefits guidebook.
The University of Michigan, which serves about 120,000 people, will reduce copays from $20 to cover the cost of the drug, known as GLP-1, an abbreviation for its active ingredient, after its plan spent nearly $9 million. Increased to $45. The co-pay will increase again to $75 starting Jan. 1, according to the university’s Office of Employee Benefits.
“GLP-1 is one of many options for weight loss,” said Brian Vasher, assistant vice president for employee benefits and welfare programs at the University of Michigan. “We want our employees to try more cost-effective options, such as weight loss programs, oral recommended brand medications, and generic medications before taking expensive GLP-1 drugs.”
The Connecticut experiment, run through a company called IntelliHealth, is showing signs of success, Scanlon said. As of Nov. 3, approximately 1,501 members of state health plans had enrolled in Flyte. The doctor writes his GLP-1 prescription for about 80% of them. And while the number of new prescriptions for these drugs has plateaued, the previous plan would have increased new prescriptions by 50% a year, a spokeswoman for the Office of the Auditor General said.
Connecticut pays about $110 per month per participant in the program. Based on current enrollment numbers, Flyte’s annual cost will be approximately $2 million.
The state will evaluate the 10-month results and consult employees before deciding whether to enter into a long-term contract with IntelliHealth.
Sloan Sanders, CEO of IntelliHealth, said the company is taking a comprehensive approach to obesity, and that healthcare providers consider lower-cost treatments before writing prescriptions for anti-obesity drugs. He said he is considering various treatment plans, including:
“Just prescribing Wegovy to someone and sending them on their way isn’t really going to give you great results,” Saunders says.
The University of Texas, in explaining its reasons for discontinuing insurance coverage, said in its employee guidebook that less than 46 percent of people using GLP-1 continue to take it long-term. It said that this “corresponds to significant costs to the plan if it falls short of insurance coverage.” – Desired compliance with medication and treatment protocols. ” Continuing coverage for weight loss drugs would increase prescription plan costs by $73 million annually and raise premiums by 2.5 to 3 percent for all plan members, according to the guidebook.
A university system spokesperson declined to comment beyond updating the guidebook.
Falwell said North Carolina could have had to triple its premiums if the state’s health plan hadn’t restricted access to these new drugs. That’s why the state Health Planning Board voted in late October to suspend coverage of the drug for new users, allowing the state to decide whether to permanently reduce coverage for weight loss drugs. Falwell said it will be possible to consider the following.
Falwell noted that if Novo Nordisk’s list price in the U.S. was close to what other countries pay, states would not consider cutting off coverage. Wegovy’s price is nearly four times higher in the United States than in Germany, Ozempic’s price is five times higher than in Japan, and the list price is the second highest among the countries. According to KFF analysis.
“Employer coverage and reimbursement for anti-obesity drugs varies,” a Novo Nordisk spokesperson said in a statement to POLITICO. “the current, [approximately] Fifty million obese patients have access to this treatment class, representing a trend of increasing coverage in government health plans and commercial plans. ”
Falwell said his office will consider different approaches to covering weight loss drugs over the coming months and is open to platforms like Flyte.
“We don’t have a monopoly on good ideas in this world,” he said. “So we’re interested in anything we can learn from other states.” [that] They too are under siege because of this price gouging. ”
As states struggle with drug costs, telemedicine programs like the one used by Connecticut are starting to gain interest among employers who want to offer coverage for weight loss drugs without going bankrupt, says Population Health Insurance Consulting. said leader Jeff Levin Schertz. Solid WTW. However, companies are just beginning to consider compensation policies, and it is unclear how well these types of programs will perform in the long term in terms of reducing costs and improving clinical outcomes.
“How successful this strategy is will depend in part on how it impacts costs, how it impacts clinical outcomes, and how it impacts member satisfaction.” said Levin Schertz.
Approximately 4 in 10 Americans are obese. According to the CDCand New research predicts KFF Vice President Cynthia Cox said that number could jump to half of Americans by 2030, creating a potentially huge market for these drugs. Cox said that while other obesity treatments, such as bariatric surgery, are expensive, the difference with GLP-1 is that people may be on the drug for the rest of their lives.
Reducing obesity, which is associated with many chronic diseases including cardiovascular disease, can lead to significant savings in health care costs, but people don’t realize those savings until decades later when they enroll in Medicare or have another job. You may be able to subscribe to the owner’s plan. In effect, private insurers may be investing in these drugs solely for the purpose of benefiting public insurers.
“Employers and health insurance companies are doing a cost-benefit analysis of where the benefits come from, and when we start to see the cost-benefit, that enrollee is still not enrolled in our health insurance. Is it likely?’” Cox said.
State Medicaid directors are also considering whether to offer the drug for weight loss, said Kate McEvoy, executive director of the National Board of Medicaid Directors. Sixteen states offer coverage for at least one type of drug, but most states restrict who can receive drugs based on parameters such as BMI or implement some form of cost sharing. he said.
She compared the staggering increase in GLP-1 to the hepatitis C drug that became widely available in 2016, with a list price of about $84,000 for a 12-week treatment course. But those drugs cured hepatitis C.
“While the Medicaid program offsets the market price based on rebates from the manufacturer, it is still a significant investment,” McEvoy said. “Also, short-term cost savings are harder to predict than in the hepatitis C drug situation.”
David Cutler, a health economist at Harvard University, said GLP-1 could become the best-selling drug in the United States since the hepatitis C drug boom. If GLP-1 prices follow a similar trajectory to hepatitis C drugs, states could wait for prices to come down as more drugs come to market, Cutler said. Stated.
But despite the high cost of these drugs, the potential long-term health benefits and cost savings “could be enormous” and states should consider them in their cost-benefit analyses, Cutler said. said.
Cutler added that a drug’s value to a patient’s health outcomes should be more important to the state than its potential cost burden, especially if the drug can extend a person’s life.
“The plan says, ‘Why do we have to pay this cost if we’re not going to benefit?'” And the short answer is, of course patients benefit, but if cost savings occur. “Medicare will save money on that,” he said.
