Good morning! More and more US employers are covering the prices of a classy class of weight-loss drugs called GLP-1, a Opinion poll found.
About one-third of employer health plans within the United States reported that they cover GLP-1 drugs, resembling Novo Nordisk's Ozempic and Wegovy for each diabetes and weight reduction, up 26% from last 12 months.
The share of GLP-1 weight-loss drugs in total annual employer spending on medical advantages also increased, accounting for nearly 9% in 2024, up from about 7% the 12 months before.
This is in response to a survey published by a non-profit organization on Thursday. organizationthe International Foundation of Employee Benefit Plans, which has greater than 33,000 member firms or public institutions. The survey was conducted in May amongst nearly 300 employer medical insurance plans within the United States.
The increase in coverage is a win for patients who, without insurance and other discounts, often struggle to afford the high monthly cost of $1,000 for these drugs. It can also be excellent news for the manufacturers of those treatments, Novo Nordisk and Eli Lillywho’re committed to improving insurance coverage for medicines and patient access overall.
Of particular note, most worker health plans and other insurers don’t cover weight-loss drugs, including GLP-1 drugs resembling Novo Nordisk's Wegovy and Eli Lilly's Zepbound. Nor does the federal Medicare program cover weight-loss treatments unless they’re approved and prescribed for an additional condition.
GLP-1 diabetes drugs, resembling Eli Lilly's Ozempic and Mounjaro, are sometimes covered by plans.
Both weight-loss and diabetes treatment drugs are gaining popularity within the U.S.—and attracting increasing interest from investors—because they assist people lose dramatic amounts of weight over time. They work by mimicking a number of hormones produced within the gut to suppress an individual's appetite and regulate their blood sugar.
About 57 percent of employer-sponsored health plans said they only cover diabetes medications, up from 49 percent in 2023, the survey found.
But a big proportion – about 19% – said they were considering whether to cover the prices of weight reduction.
“The new survey data show that over the past six months, GLP-1 coverage for both weight loss and diabetes has increased,” said Julie Stich, vp of content on the International Foundation of Employee Benefit Plans, in a press release.
Stich said recent regulatory approvals and clinical trials, in addition to increasing demand for GLP-1 drugs within the U.S., have contributed to broader coverage.
For example, Novo Nordisk's Wegovy is now approved within the USA since it drastically reduces the chance of great heart complications.
Insurance industry experts previously told CNBC that the approval wouldn’t mechanically result in widespread coverage of the weight-loss drug by health insurers. At the very least, some insurers would be aware of Wegovy's recent use and consider covering the treatment the subsequent time they update their drug lists, these experts said.
Novo Nordisk and Eli Lilly are also conducting a variety of studies of their GLP-1 drugs in quite a lot of patients, including those with chronic kidney disease, sleep apnea and a certain kind of fatty liver disease.
However, there isn’t any doubt that these drugs can place a burden on any medical insurance company’s budget.
According to the survey, around 85 percent of employers who comply with GLP-1 obligations rely “heavily” on requirements geared toward controlling costs.
These include certain eligibility requirements, resembling requiring employees to have a certain BMI (body mass index) to be covered, and “step therapy,” which requires insureds to try other, inexpensive medications or weight reduction products before using a GLP-1.
Meanwhile, other insurance coverage are withdrawing coverage for weight-loss drugs. Blue Cross Blue Shield of Michigan, the state's largest insurance company, said it is going to start removing the duvet various weight reduction medications over the subsequent 12 months.
But there’s a much bigger problem, at the same time as employer coverage improves: Novo Nordisk and Eli Lilly are struggling to supply enough drugs to satisfy demand. That is one other aspect of the GLP-1 story that we are going to proceed to observe.
Please send suggestions, suggestions, story ideas and data to Annika at annikakim.constantino@nbcuni.com.
Latest technology in healthcare
Healthcare firms exploring recent uses for artificial intelligence are having great success with enterprise capitalists.
One in 4 healthcare investment dollars goes to firms that use AI. And transaction activity in healthcare AI has grown twice as fast as AI transactions in the general technology industry, in response to a current report from Silicon Valley Bank, now a division of First Citizens Bank.
According to the report, enterprise capitalists invested $7.2 billion in AI in healthcare last 12 months, and this 12 months the number is predicted to achieve $11.1 billion.
About 60 percent of the funding is for administrative AI applications in healthcare, the report says. Office work resembling paperwork is a significant burden on the healthcare sector and contributes to physician burnout and staff shortages.
More than 90% of physicians report feeling burned out frequently, and 64% of those doctors said overwhelming administrative workloads are a primary reason, in response to a survey conducted by Athenahealth in February. Doctors spend a mean of 15 hours per week outside of their normal work hours completing administrative tasks, the survey found.
In other words, administrative burden is a significant problem for the healthcare sector. Venture capitalists are particularly enthusiastic about it because this sector is usually subject to less regulatory scrutiny than clinical decision support or patient-centered solutions, the SVB report says.
While healthcare AI firms are expected to boost more funding this 12 months than last 12 months, SVB says access to high-quality data and sufficient computing power to coach models may very well be barriers to adoption.
This is very true for AI-powered patient diagnostic tools, which account for 52% of total investment in clinical solutions, in response to the report. There is currently a “significant gap” in access to the computing power and data required to coach a model that may accurately diagnose a patient.
“Companies that can access data, partner with doctors and hospitals to leverage patient data, and collaborate with large technology companies are better equipped to deploy AI at scale,” the report said.
Feel free to send suggestions, suggestions, story ideas and data to Ashley at ashley.capoot@nbcuni.com.
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