GLP-1 coverage cuts: What shifting payer policies mean for prescribing, access, and utilization

Glucagon-like peptide-1 (GLP-1) receptor agonists like semaglutide (sold under brandnames Wegovy and Ozempic) and tirzepatide (Zepbound, Mounjaro) have transformed how physicians and patients approach treatment for type 2 diabetes and obesity. With just a daily or weekly injection, GLP-1 drugs are helping patients lose weight, lower blood sugar, and avoid cardiovascular events like heart attack or stroke.

The use cases don’t stop there: Research shows these therapies could change patients’ relationships with food and alcohol, improve cancer treatment, and even reduce dementia risk.

However, these impressive clinical benefits come at a significant cost. Even as Wegovy, Mounjaro, and other GLP-1 therapies become household names on par with Tylenol and Kleenex, financially burdened payers and employers are beginning to restrict coverage and drop the drugs from their formularies.

At the start of 2026, Blue Cross Blue Shield of Massachusetts dropped coverage of GLP-1s for obesity treatment for employers with fewer than 100 employees. Other payers who dropped GLP-1 coverage for weight loss this year include Harvard Pilgrim Health Care, Blue Cross Blue Shield of Michigan, and North Carolina’s Medicaid program.

ACA marketplace plans are also reducing access to GLP-1s for weight loss, with only 26 of the 300 carriers offering coverage, and overall coverage rates falling from 3.6 million enrollees in 2024 to 2.8 million in 2026.

So why now? And what does it mean for stakeholders across the industry?

Why are insurers cutting GLP-1 coverage?

Cost is the primary factor driving payers to restrict GLP-1 coverage. List price for GLP-1 drugs in the U.S. ranges from around $900 to $1,400 per month. With an analysis of national data suggesting that more than half of the U.S. adult population could be eligible candidates for semaglutide alone, that cost could quickly skyrocket as demand and utilization grow.

In 2025, 36% of employers offered to cover GLP-1 drugs as a treatment for both obesity and diabetes, with about 55% covering diabetes alone. That same year, GLP-1 drugs for weight loss represented over 10% of all annual claims among employer-provided plans in the U.S. A study from the Employee Benefit Research Institute estimates that expanding coverage of GLP-1 medications would drive premiums up between 5% and 14%, depending on adherence, cost-sharing, and eligibility details.

Pharmacies are struggling to keep up with the cost and demand, too. A report from PricewaterhouseCoopers found that GLP-1 drugs drove a disproportionate share of the $50 billion hike in pharmacy spending in 2024 (up from a $20 billion increase in 2023).

From a public health perspective, the short-term cost of boosting GLP-1 drug coverage could lead to long-term cost savings associated with emergent and routine care for chronic conditions like cardiovascular disease, liver disease, heart failure, and depression, all of which are comorbid with obesity.

But those benefits are largely contingent on long-term use and adherence. A study from Prime Therapeutics found that, among patients taking GLP-1s for obesity, just under one-third persisted in taking the drug for a full year. At the two-year mark, that figure dropped to 15%.

On top of the persistence and adherence barriers, payers face diminishing incentives to invest in patients long-term. Every year, between 15% and 20% of publicly and privately insured Americans swap or drop their insurance plans. This churn drives up marketing and administrative costs for payers and employers, and disincentives payer investment in prevention, diagnosis, and management of chronic illnesses (such as obesity and the conditions associated with it).

How are payer restrictions changing GLP-1 prescribing trends?

Rather than outright removal, many insurers are opting to scale back coverage through tighter controls. In 2020, only around 3%-5% of GLP-1 prescriptions required prior authorization. Today, nearly 100% of GLP-1 prescriptions must be authorized in advance by the insurer.

Additionally, some insurers are implementing step therapy and BMI or comorbidity requirements to slow utilization and restrict inappropriate use.

But whether GLP-1s are covered by their insurance or not, Americans are increasingly seeking prescriptions for these drugs. Around 12% of U.S. adults reports currently taking a GLP-1 drug—about a six-point increase from the beginning of 2024.

More than half of those users say they’re having trouble covering the cost of treatment, according to a Kaiser Family Foundation poll. Of GLP-1 users with health insurance, more than a quarter say they’re covering the cost entirely out of pocket. But even with restrictions in place, the GLP-1 market and prescribing rates are expected to grow.

Who’s impacted by GLP-1 coverage cuts?

While patients are showing some willingness to absorb cost hikes associated with reduced payer coverage for GLP-1 drugs, they’re far from the only stakeholders to be impacted by shifting policies:

Biopharma

Pharmaceutical developers could face slower market growth, particularly for newer indications like cardiovascular risk reduction and addiction treatment. They’ll likely need to adapt pricing, marketing, and real-world evidence strategies to continue pushing payers toward coverage.

For some developers, direct-to-consumer sales and rebates negotiated with federal and commercial payers could boost utilization and lower out-of-pocket costs, even if restrictions continue to mount.

Providers

Clinicians will need to prepare for increased administrative burden related to navigating prior authorization demands. Depending on the makeup of their patient base, providers may need to navigate patient therapy discontinuation and a change in payer mix that could impact revenue.

They’ll also need to provider patient education around payer eligibility criteria and potentially offer alternative therapies for patients unwilling or unable to take on higher treatment costs.

Employers

For employers, GLP-1 coverage decisions can impact healthcare costs, employee satisfaction, and retention. As coverage becomes more restrictive, employers will have to decide whether and how to absorb or redistribute premium increases. Employer plans that integrate incentivized lifestyle interventions and wellness programs alongside pharmaceutical options could help to manage the risk of reducing GLP-1 coverage.

Track GLP-1 prescribing trends with all-payer claims data

As research into GLP-1s continue to expand the indications for this therapy, payer and employer coverage policies will keep evolving alongside patient behavior. All-payer claims data can offer early signals of how utilization and prescribing trends are changing in response.

By monitoring GLP-1 prescriptions, obesity or diabetes management consultations, and other relevant diagnosis, procedure, and prescription claims, you can identify localized utilization trends, determine the financial impact of coverage changes in key networks or facilities, and identify high-value accounts for engagement.

Whether you’re in sales, marketing, business strategy, or operations, if your organization is impacted by GLP-1 coverage trends, claims data provide the clarity you need to find opportunities, minimize risk, and plan for the future.

Definitive Healthcare’s product portfolio includes all-payer claims data, reference and affiliations data, patient-level access and utilization insights, predictive analytics tools, and more. Sign up for a demo today.