More than 40% of Americans are now classified as obese while 75% of adults are either overweight or obese. A new group of drugs called GLP-1 receptor agonists have come on the scene to help in the battle to lose weight. Are they as good as we think?
You may have heard about them or some of their brand names like Zepbound, Wegovy, and Ozempic. The use of these drugs has exploded in popularity to the point where companies like Lilly and Novo Nordisk have had problems keeping up with demand. There is nothing magical about the science behind these drugs. GLP-1 mimics a protein naturally produced by our small intestines. The receptors for these medicines are located across the body. They help us lose weight because receptors in the gastrointestinal tract slow down and send signals to the brain that give us a sense of feeling full.
There are some side effects but nothing too serious for most patients. We are still learning how these medications impact the body. They are currently approved for treating diabetes, obesity, and those with a history of cardiovascular disease in people who are overweight. There are a few drawbacks to these drugs at present.
Typically, GLP-1 agonists are administered as injections in the abdomen, upper arms, outer thighs, or upper buttocks via a syringe and needle or a pre-filled dosing pen. The shots are generally taken once a day or once a week.
For many, this is a big turn-off. Fortunately, you will be able to take tablets soon. The typical weight loss is from 5-15% of body weight over at least 12 months. But GLP-1 is no quick fix. Like exercise, you must stick with it. If you stop taking it, most people regain the weight they lost. And you can’t expect to magically lose weight while you continue to eat all that junk food you get.
The second drawback is the expense. These medications’ list price is around $1,000 a month to $1,400 a month. Without insurance, we are talking $12,000 plus per year for these drugs. Many insurance plans cover some portion of GLP-1 costs, but the extent of coverage can vary significantly. You probably are wondering whether Medicare covers GLP-1 medications. They do for certain medically accepted indications such as heart attack or cardiovascular disease but not for weight management. To qualify, you must have a BMI of 30 or higher, or 27 or higher with comorbidities like high blood pressure, high cholesterol, or type 2 diabetes. They are currently covered through Part D plans.
An entirely new team of individuals, including a retired congressman, a surgeon, and a talk-show host could play pivotal roles in how the government goes about safeguarding America’s health.
Coinsurance amounts are pegged to the list price of drugs. As such, Medicare beneficiaries who qualify could still face monthly costs of $250 to $430 before they reach the annual out-of-pocket drug spending established by the Inflation Reduction Act (IRA). The IRA cap for out-of-pocket expenses were around $3,300 in 2024 and will be $2,000 in 2025. Most retirees living on modest incomes would still find the cost of GLP-1 prohibitive.
In November 2024, the Biden Administration proposed that Medicare and Medicaid cover obesity medications. In doing so, they sidestepped a twenty-year-old piece of legislation that prevented Medicare from covering drugs for ‘weight loss.’ The new proposal specifies that the drugs would be covered to treat the disease of obesity and prevent related conditions. Those conditions are serious and include diabetes, high blood pressure, cardiovascular disease, sleep apnea, fatty liver disease, and arthritis.
The classification would also mean that every state Medicaid program would be required to cover the drugs starting in 2026. Between the two programs, an additional 7.4 million Americans would gain coverage. The price tag would be high, at least $36 billion over a decade. However, there are more obesity drugs in the pipeline and prices should fall as competition heats up. Starting in 2025, Medicare will also be able to negotiate a lower price for Wegovy as well as many other popular drugs.
As for the future, the costs and usage of GLP-1 medications could change significantly under the second Trump Administration. An entirely new team of individuals, including a retired congressman, a surgeon, and a talk-show host could play pivotal roles in how the government goes about safeguarding America’s health.
Under Robert F. Kennedy, an environmental lawyer, politician, and anti-vaccine organizer, we can expect radically different views and actions in health care, medicine, food safety, and science research. Early indications are that Kennedy, who would run the Department of Health and Human Services, is not a big fan of Ozempic. He does not believe that using popular GLP-1 drugs is ever going to make America healthy again. His remedy would be to provide good food to Americans. He believes that providing three nutritious meals a day to all Americans would solve obesity and diabetes overnight. The problem is that for many Americans the admonition to change your diet, eat less, and exercise more has failed to dent the problem. Why not give the country an avenue that shows a much better chance of success over the long term?
Bill Schmick is a founding partner of Onota Partners, Inc., in the Berkshires.
