Two recent news items reveal countervailing trends in employer health insurance coverage for GLP-1 drugs, the highly effective and highly expensive medications for treating diabetes and obesity.<\/p>\n
The insurer Cigna reported a pullback in coverage of GLP-1 drugs for weight loss. Six percent of large employers<\/a> dropped coverage in 2026, according to Bloomberg. <\/p>\n Meanwhile, Bank of America is doubling down. It\u2019s continuing to cover GLP-1s for weight loss (in addition to covering them to treat diabetes), while also providing healthcare and lifestyle coaching for those on the drugs \u2014 at a cost of $250 million a year. That now represents 13% of the company\u2019s total healthcare spending. <\/p>\n Kristi Turner knows what it\u2019s like to deal with changing policies around GLP-1 coverage. She is 48, lives in Indiana, is self-employed, and has been struggling with obesity since she was a teenager. <\/p>\n \u201cI have lost 50 to 100 pounds probably five to ten times in my life, but there\u2019s just been nothing that works for me long-term,\u201d she said. That is, until recently. \u201cI started on Zepbound back in May of 2024. Since then I\u2019ve lost 203 pounds, I still have about 45 to go. I\u2019m still working on it.\u201d<\/p>\n Turner\u2019s husband is a teacher, and initially, her Zepbound was covered by his insurance for just $25 per month out-of-pocket. <\/p>\n But in January 2025, with costs rising, the insurance plan\u2019s pharmacy benefit manager terminated GLP-1 coverage for weight loss. <\/p>\n \u201cI politely raised hell for about three or four months,\u201d said Turner. \u201cBut I didn\u2019t win.\u201d <\/p>\n Turner now buys her Zepbound directly from the manufacturer<\/a>, Eli Lilly, for $449 a month. It could cost twice that if she bought it at a pharmacy without insurance coverage. <\/p>\n Turner\u2019s experience is common, said Paul Fronstin, director of health benefits research at the Employee Benefit Research Institute. <\/p>\n \u201cMost employers are covering it, but not for weight loss,\u201d he said. <\/p>\n According to the International Foundation of Employee Benefit Plans\u2019 2026 employer survey, more than 90% of employers cover GLP-1s for diabetes<\/a>. But only 36% also cover them to treat obesity.<\/p>\n Fronstin views this mainly as a business decision for employers. <\/p>\n \u201c8% of the population with employment-based coverage has diabetes, whereas half the population would be eligible for a weight-loss drug,\u201d he said. \u201cEmployers are saying, \u2018Can we really afford to cover this, when so many people are eligible or would benefit from it?\u2019\u201d<\/p>\n \u201cOne of the things employers wrestle with is: \u2018how long are my employees going to be with me and when am I going to see a return on this investment,\u2019\u201d Fronstin continued. \u201cBank of America said, \u2018short-run it\u2019s going to hit us financially, long run we expect it to benefit us.\u2019\u201d <\/p>\n But the economic research so far seems to point in the opposite direction, according to Vivian Ho, a health economics professor at Rice University. Ho cited a recent National Bureau of Economic Research working paper, \u201cDo GLP-1 Medications Pay for Themselves?\u201d<\/a><\/p>\n \u201cEven though there are health benefits,\u201d Ho said, \u201cthese medications are not cost-saving for the employer. They yield value for the employee, but it\u2019s not as if employers are going to save money. And of course, they\u2019re struggling to cover their health insurance premiums<\/a> as it is.\u201d <\/p>\n Ho said there may well be some economic benefits to a company that covers GLP-1s for weight loss, even if these don\u2019t offset the soaring costs of the drugs. <\/p>\n \u201cEmployers are happy to pay for things that improve the productivity of their workers which are related to an illness,\u201d she said, \u201cand there may be productivity gains because of weight loss. But it\u2019s a slippery slope \u2014 particularly because these medications are so expensive.\u201d<\/p>\n Companies may well never recoup the current high cost of covering GLP-1s for weight loss, said Ellen Magenheim, a health economics professor at Swarthmore College \u2014 in terms of achieving better health outcomes for workers, or higher productivity. She said so far, research on the question isn\u2019t encouraging. <\/p>\n But she still doesn\u2019t believe that justifies companies\u2019 decision to not extend coverage. <\/p>\n \u201cThis distinction between your insurance will pay for it if you\u2019re diagnosed with diabetes, but not if you have obesity \u2014 I don\u2019t fully understand,\u201d Magenheim said. \u201cClearly, they\u2019re very effective, important drugs that we would want people to take.\u201d <\/p>\n Magenheim argues that the current system benefits the most privileged members of society \u2014 those with gold-standard health plans, or enough wealth to afford GLP-1s on their own. She pointed out that the vast majority of patients on Medicaid \u2014 the federal health insurance program for low-income people \u2014 can\u2019t get coverage<\/a> for GLP-1s to treat obesity. <\/p>\n \u201cSome private insurers cover it, some don\u2019t,\u201d said Magenheim. \u201cSome are cutting back because it\u2019s very expensive. The cost seems prohibitive for anybody but those with high income or assets to be able to pay for it out-of-pocket.\u201d<\/p>\n The current high cost structure and the patchwork of insurance coverage for GLP-1 drugs to treat obesity leads to inequitable outcomes, according to Arthur Caplan, emeritus professor of bioethics at New York University. <\/p>\n \u201cThe U.S. has long denied rationing in its healthcare system,\u201d said Caplan. \u201cBut we do ration \u2014 by coverage, are you insured. It\u2019s not medical necessity, and it\u2019s not even diagnosis, it really is affordability for the third-party payer that\u2019s driving access. And in my view, that\u2019s wrong, that\u2019s unjust. There are people who need these drugs who aren\u2019t getting them.\u201d<\/p>\n