Trump admin shifts course on Medicare GLP-1 coverage
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The Trump administration is indefinitely delaying a Medicare pilot program to cover weight-loss drugs after health insurance companies voiced concerns about participating, federal officials said Tuesday.
Why it matters: It's a blow to the administration after President Trump last year touted deals with Eli Lilly and Novo Nordisk to cut prices on GLP-1 drugs in exchange for access to a new pool of patients.
- Medicare will still cover the drugs for weight loss through a transitional program starting in July and running through the end of 2027, but it will foot the bill on its own.
State of play: The administration will shelve plans for a five-year experiment known as BALANCE, in which participating private Medicare insurers would have paid for drugs like Zepbound and Wegovy as a regular benefit.
- The extra time and data will "inform the potential implementation of BALANCE in Part D," the Centers for Medicare and Medicaid Services said in a memo.
- The transitional program means seniors can still get expanded coverage, and participating Medicare drug plans don't have to take on any financial risk.
- But without the pilot program, Medicare patients who have been prescribed GLP-1s for weight loss can't count a $50 co-pay towards their deductible or out-of-pocket maximum. That change could pose a financial barrier for some.
- CMS is still moving forward with the Medicaid portion of the pilot, and states can apply through July 31 to participate.
Zoom in: Bobby Hunter, UnitedHealth CEO of government programs, cited concerns about the initiative on the company's earnings call Tuesday morning.
- "We would like to find a path to yes on coverage over time, but there are some notable challenges and outstanding questions with the currently planned structure."
Yes, but: Raymond James analyst Chris Meekins said the bridge program will give CMS time to find a path forward for the BALANCE pilot and still help beneficiaries access the drugs at lower costs.
- "This is a win for plan sponsors, [Eli Lilly and Novo Nordisk], as well as for Medicare beneficiaries," he wrote in an analyst note.
Medicare is barred by law from covering weight-loss drugs. The BALANCE program was intended as a workaround, allowing Medicare beneficiaries to access the drugs for just the $50 co-pay.
- But the effort hinged on getting Medicare drug plans covering 80% of certain beneficiaries to participate.
- Insurers had until April 20 to opt in.
- A spokesperson for the insurer trade group AHIP said the transitional program is "a common-sense step to maintain access for seniors and generate important learnings that can be applied to ensure sustainable coverage moving forward."
- An Eli Lilly spokesperson said the company supports the intent of the BALANCE pilot, and that the extension "provides an important opportunity to continue reaching patients who can benefit from GLP-1 therapies today."
