The Trump administration on Friday rejected a Biden plan that would have required Medicare and Medicaid to cover obesity drugs and expanded access for millions of people.
Under the law that established Medicare’s Part D drug benefits, the program was forbidden from paying for drugs for “weight loss.” The Biden administration’s proposal last November had attempted to sidestep that ban by arguing that the drugs would be allowed to treat the disease of obesity and its related conditions.
Expanding coverage of the drugs would have cost the federal government billions of dollars. The Biden administration estimated the federal expense at about $35 billion over 10 years.
The decision announced Friday was part of a larger 438-page regulation updating parts of the programs through which beneficiaries get drug and private medical coverage. The latest revision did not explain why Medicare should not cover the drugs.
Catherine Howden, a spokeswoman for the Centers for Medicare and Medicaid Services, said in an email that the agency believes expanding coverage “is not appropriate at this time.” But she said the agency had not ruled out coverage and “may consider future policy options” for the drugs.
The most popular weight loss drugs come from Novo Nordisk, which sells its medicine as Wegovy for weight loss and as Ozempic for diabetes, and from Eli Lilly, which sells its product as Zepbound for weight loss and Mounjaro for diabetes.
Medicare, the government insurance program for Americans over 65 and people with disabilities, does cover the drugs for patients with diabetes, and a much smaller subset of people who have both obesity and another health condition, like heart problems or sleep apnea. The Biden plan would have extended coverage to patients who were obese but did not have those diseases. Medicare officials had estimated around 3.4 million more people would have chosen to take the drugs under the policy.
Robert F. Kennedy Jr., the health secretary, has been vocal in his criticism of the weight loss drugs, saying they are inferior to consuming healthy food.
The drugs have been shown in clinical trials to have benefits far beyond weight loss, like preventing heart attacks and strokes.
Proponents of expanded coverage have argued that the government’s expenditure on the drugs would pay for itself in the long run. Patients, they say, would become healthier and that would prevent expensive medical bills. It’s not clear yet whether such savings will materialize.
State Medicaid programs, which provide health care for the poor, can currently choose whether to cover the drugs, and some do. If the broader Medicare policy had been finalized, coverage would have been required in every state.
The obesity drugs cost Medicare and Medicaid hundreds of dollars per patient each month, though the exact prices are secret.
Many employers and private health insurance plans do not cover the drugs. Some, including state employee benefit plans in North Carolina and West Virginia, dropped coverage of the drugs after their popularity surged, citing high costs.
Eli Lilly and Novo Nordisk now offer their products for $350 to $500 a month to patients who pay with their own money instead of going through insurance. But until recently, patients sometimes had to pay over $1,300 a month.
Without insurance coverage, many patients on Medicare and Medicaid have been relying on inexpensive copycat versions of the drugs produced through a drug-ingredient mixing process known as compounding. These versions, which were allowed because the brand-name drugs were in short supply, can cost less than $200 a month. But regulators have ordered such sales to wind down soon because supply of the brand-name products has improved.
Republicans in Congress have expressed some interest in requiring Medicare to cover the drugs. The idea was included in a list of policy options produced by the House Budget Committee earlier this year. But it does not appear to be a major priority right now.
Novo Nordisk’s Wegovy will be subject to price negotiations with Medicare this year. Barring further changes, the government stands to pay that lower negotiated price starting in 2027 only for patients who have both obesity and one of the other health conditions the drugs have been shown to improve. That process has the potential to reduce the long-term costs of coverage.
