Employers cutting off insurance coverage for costly weight-loss drugs like Ozempic: report
The extraordinary demand for pricey weight-loss drugs like Ozempic is forcing some employers to cancel insurance coverage to offset soaring bills, according to a report.
The popular drugs can cost as much as $1,350 a month for a patient taking Wegovy and Saxenda — which fall under the same class as the celebrity-fueled craze for Ozempic.
That has put a strain on some employer-funded plans, which have seen spending on coverage skyrocket into the tens of millions of dollars, according to The Wall Street Journal.
The cost has become too high for the University of Texas System, which recently announced that as of Sept. 1 it would end coverage of Wegovy and Saxenda, developed by Danish pharmaceutical giant Novo Nordisk to treat diabetes.
A year and a half ago, UT Systems was footing a $1.5 million monthly bill for these weight-loss shots, which mimic the actions of the GLP-1 hormone that the pancreas releases after eating to make people feel full.
Now, its monthly payment has soared over $5 million, according to the Journal.
“Continuing to dispense these medications would add an additional $73 million a year to the prescription plans, an amount that is unsustainable,” UT Systems said, noting that it would also drive up premiums by as much as 3% for all employees.
The public university system noted that 3,200 of its workers enrolled in a benefits plan have been utilizing the coverage for Wegovy or Saxenda prescriptions — nearly 3% of its 115,000-staffer workforce.
The Post has sought comment from UT System.
Another large employer, Ascension Healthcare — the second-largest private healthcare system in the US that operates non-profit and Catholic hospitals — cut off its anti-obesity drugs including Wegovy and Saxenda July 1, according to an online notice.
The St. Louis-based healthcare provider — which employs nearly 140,000 people and operates hospitals in 19 states, primarily in the Midwest and South — didn’t immediately respond to The Post’s request for comment.
Without insurance, Type 2 diabetes drug Ozempic — now better-known as a trendy, quick-fix semaglutide injection — can cost patients about $1,200 per month, according to WebMD.
“But if you’re one of the lucky ones whose insurance covers the drug, it can be much cheaper,” the site added, noting that one pre-diabetic patient whose Ozempic prescription is covered costs $25 for a 30-day supply.
The University of Michigan’s employee benefits still include coverage for the jabs, though it increased the co-pay from $20 to $45 in an effort to curb costs back in March, according to the university’s human resources site.
The move was designed to encourage health plan members to first try other, less expensive options.
The co-pay for less-costly phentermine tablets, for instance, is only $10 a month.
The reimbursement cuts and other restrictions come at the expense of prevention treatments aimed to cut the costs to employers’ health plans, experts said.
“Everybody is concerned this treatment is going to add a huge cost burden on health plans,” Michael Thompson, chief executive of the National Alliance of Healthcare Purchaser Coalitions, which includes groups representing employers, told the Journal. “It’s one of the key issues employers are having to wrestle with today because of the prevalence of these medicines.”
Ozempic and the other drugs are often covered by insurance when they’re prescribed to treat Type 2 diabetes and cardiovascular disease, which is what they were originally intended for.
But their demand has soared after patients discovered their slimming effects.
They’ve become so popular that “people with diabetes have been struggling to get their hands on it amid widespread shortages,” according to WebMD.
Ozempic has particularly exploded among people wanting to slim down after it was revealed that celebrities like Khloe Kardashian and Chelsea Handler admitting to using it.
“Americans are being prescribed the drug [Ozempic] at an extraordinary pace and make up reportedly around 10% of global prescriptions,” WebMD noted.
Elon Musk publicly proclaimed last October that he shed pounds with fasting and Wegovy.
However, the prescription drugs have also been blamed for causing a slew of detrimental — and bizarre — side effects, including “Ozempic butt,” where users are claiming that their derrières have flattened along with their tummies, and “Ozempic finger,” where finger and wrist sizes were rapidly shrinking too, causing women to fear that their engagement rings would fall off.
The latest alleged side effect is much more serious: Last month, Iceland’s health regulator flagged two cases of patients on Ozempic and one on Saxenda having suicidal and self harm-related thoughts.
One other Saxenda user reported thoughts of self-injury.
“The US healthcare system is complex and there are multiple factors which affect how chronic diseases are understood, treated and covered by insurance,” a spokesperson for Novo Nordisk told The Post. “Importantly, Novo Nordisk is committed to ensuring responsible use of our medicines.”
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