Medicaid Coverage of and Spending on GLP-1s

(By Elizabeth Williams, Robin Rudowitz, and Clea Bell for The Kaiser Family Foundation Published: Nov 04, 2024)

GLP-1 (glucagon-like peptide-1) drugs have been used as a treatment for type 2 diabetes for over a decade, but newer forms of these drugs have gained widespread attention for their effectiveness as a treatment for obesity. While these drugs have provided new opportunities for obesity treatment, they have also raised questions about access to and affordability of these drugs. These drugs are expensive when purchased out of pocket, and coverage in Medicaid, ACA Marketplace plans, and most large employer firms remains limited, though a number of state Medicaid programs and other payers are re-evaluating their coverage policies. Expanding Medicaid coverage of these drugs could increase access for the almost 40% of adults and 26% of children with obesity in Medicaid. At the same time, expanded coverage could also increase Medicaid drug spending and put pressure on overall state budgets. In the longer term, however, reduced obesity rates among Medicaid enrollees could also result in reduced Medicaid spending on chronic diseases associated with obesity, such as heart disease, type 2 diabetes, and types of cancer. This brief discusses Medicaid coverage of GLP-1s, examines recent trends in Medicaid prescriptions and gross spending on GLP-1s, and explores the potential implications of expanding coverage obesity drugs for Medicaid programs. Continue reading here…

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