Why Employers Are Pulling Back on Weight-Loss Drug Coverage

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Employees who take weight-loss drugs like Ozempic and Wegovy may soon face sticker shock if their employer decides to limit coverage. And in an effort to cut costs, many are doing so.

According to a Tuesday report from the Wall Street Journal, companies are either eliminating coverage entirely or restricting how employees can access weight-loss medications. RWJBarnabas Health, a New Jersey-based health care provider, reportedly stopped covering weight loss medications last month. A spokeswoman for the company pointed to both the cost of the drugs and the company’s observations that employees were not always effectively using the medications. The company reportedly continues to cover drugs like Wegovy for employees with diabetes.

The move comes as many pharmaceutical companies have raised the prices of drugs such as Ozempic and Mounjaro. For example, the price for Ozempic rose 3.5 percent this year, making the monthly per person cost now close $970. While it’s typical for the cost of prescription drugs to rise every year in accordance with inflation, employers are likely to feel the impact of even moderate price increases for weight-loss medications due to their already high costs, Nelly Rose, a pharmacist at NFP, a leading benefits consultant, previously told Inc.

Other companies are not eliminating their coverage but placing limits on who can access weight-loss medications. According to the Journal, Purdue University requires employees to have a certain body mass index to receive coverage. This is in alignment with the Federal Drug Administration’s guidelines, which suggest drugs like Ozempic and Wegovy should only be given to patients with a BMI of 30 (or 27 or higher along with other conditions or complications).

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