Medicare Postpones New Coverage for GLP-1 Weight-loss Drugs
The implementation of a Medicare initiative requiring insurers to cover GLP-1 weight-loss drugs, such as Wegovy by Novo Nordisk and Zepound by Eli Lilly, has been postponed. However, Medicare recipients will retain access to these medications via a bridge program slated from July 1, 2026, to December 31, 2027, according to the Centers for Medicare & Medicaid Services (CMS).
This interim measure allows Medicare participants, aged 65 and older, to use the weight-loss medications at prices negotiated under pre-existing agreements with the manufacturers. The cost for enrollees includes a $50 monthly copayment, as outlined by the drug companies.
According to CMS, the initiative aims to provide access to certain GLP-1 drugs without integrating them into the Medicare Part D benefit structure. This decision follows input from several insurers regarding the BALANCE (Better Approaches to Lifestyle and Nutrition for Comprehensive Health) program, which would have mandated Part D plans to cover these medications. Insurers were given until April 20 to decide on participating in this program.
CVS Health, the parent company of Aetna, opted against joining BALANCE, while UnitedHealth cited unresolved issues during an earnings call. BALANCE, originally set to launch at the end of 2025, sought to circumvent restrictions on weight-loss drug coverage, also involving a $50 monthly copay for beneficiaries.
CMS Administrator Mehmet Oz has stated that BALANCE was designed to "expand access and lower prices" for GLP-1 drugs without impacting taxpayers. The Medicaid component of BALANCE remains active, with applications open to states until mid-2026. Medicaid operates with both federal and state funding, in line with federal regulations.
Lilly praised the bridge program as a positive step amid insurer hesitation. A spokesperson emphasized support for the BALANCE model's long-term goals while acknowledging the bridge program's role in making GLP-1 drugs accessible to patients in need. Similarly, Novo Nordisk expressed its commitment to supporting the interim program while seeking sustainable access solutions for senior Americans.
The extension to 2027 provides temporary clarity regarding coverage for weight-loss medications. However, the indefinite postponement raises questions about their future integration into Medicare drug benefits, as noted by industry analysts. J.P. Morgan analyst Chris Schott remarked that once established, reversing this obesity benefit might prove difficult in the foreseeable future.