There should be room for compromise. For example, it might be reasonable for the unions to accept prior authorization for GLP-1 drugs but for the city to defer negotiations on prior authorization for any other drugs until the union contract expires in 2027.
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But however Boston’s issues are resolved, the controversy points to a national problem that virtually every employer — governments included — is wrestling with. GLP-1 drugs are effective in helping people lose weight, which can have positive impacts on health like reducing the risks of type 2 diabetes or heart disease. Over time, keeping someone healthier means they should incur lower health care costs. But the drugs are expensive, with list prices that can be more than $1,000 a month, and insurers are increasingly limiting coverage to avoid either losing money or hiking premiums.
In Boston, Chief Financial Officer Ashley Groffenberger wrote to the City Council March 16 that covering GLP-1 drugs for weight loss cost the city an estimated $31.6 million in fiscal 2026, expected to rise to $47.4 million in fiscal 2027, which starts July 1. While only 7.7 percent of plan members use GLP-1 drugs for weight loss, around 3,200 people, she expects these drugs to account for 14.7 percent of the city’s projected health care cost increase next year. City officials worry that Boston’s generous policy could make the city a magnet for GLP-1 users, further increasing costs. For example, an employee’s spouse could switch from a plan that doesn’t cover the drugs to Boston’s insurance.
City officials are seeking to introduce “utilization management” for all city plans starting July 1, which essentially means prior authorization, where a doctor needs to justify to a patient’s insurer that the drugs are medically necessary. While city officials have focused on its use for GLP-1 drugs, an unspecified number of other drugs would also require utilization management under the proposal. Groffenberger estimates that could save the city between $8 million and $9 million.
It would also have a minor financial impact on employees. The city pays either 68.5 percent or 78.5 percent of employees’ premiums, depending on the plan. With no benefit changes, the average city employee would experience a 22.6 percent jump in premiums. For the most widely used family plan, that would mean paying $803 a month, up from the current $655, Groffenberger wrote. With utilization management, the increase would be 20.3 percent, with a monthly premium of $788 for the most popular plan, according to information the city gave the union, which was shared with the editorial board.
The city currently has a health care agreement with its unions that expires in 2027. Any change requires approval from Boston’s Public Employee Committee, which includes representatives from each city union. A majority of the committee rejected the utilization management proposal. Committee cochair Elissa Cadillic told the editorial board that members knew a premium increase was coming, and they didn’t want to potentially disrupt people’s access to medication for a relatively small financial benefit. City officials are asking for a revote.
Long-term, the solution needs to be for GLP-1 drug prices to come down. After all, patients in many comparable countries — like Japan, Canada, and the United Kingdom — pay far less than US patients for the same medications.
The drugmakers have been offering lower prices directly to consumers, an approach President Trump took as well, launching the TrumpRx website with lower negotiated prices. Wegovy, for example, sells its injectable drug for $349 a month for a 0.5 milligram dose directly to consumers and on TrumpRx, even though its list price is $1,000 higher. The downside of direct-to-consumer sales, however, is it creates a two-tiered market where only people who can afford to pay out of pocket get the drugs.
Potential ways to bring down costs for everyone include increased market competition from new products, allowing compounded versions of drugs, letting Medicare negotiate prices, or finding other ways to let the federal government negotiate prices — all solutions that have pros and cons. On an employer level, systems like requiring prior authorization or weight loss wellness programs can lower costs by ensuring that coverage for GLP-1 drugs is limited to those people who would most benefit.
GLP-1 drugs are effective and popular. If our health system can’t figure out how to pay for them, many more cities, states, and employers will struggle with the same controversies as Boston.
Editorials represent the views of the Boston Globe Editorial Board. Follow us @GlobeOpinion.