As the buzz grows around using GLP-1 drugs such as Ozempic and Wegovy as a tool to help shed pounds, more HR leaders say they plan to cover the drugs for their employees.
Forty-three percent of employers plan to cover the weight loss drugs in 2024, nearly double the share of employers that cover them now (25 percent), according to newly released survey findings from Accolade, a health care firm.
The survey of 500 employers found that most human resource decision-makers are open to adding GLP-1 medications to their benefits package, with 81 percent reporting that their employees would be interested in GLP-1 medications.
The anticipated spike is likely the result of high interest among employees, as well as potential boons to employers in terms of healthier workers. Providing access to the medications could also be a recruitment and retention tool, said James Wantuck, M.D., associate chief medical officer at Accolade.
"With the recent spike in demand surrounding these medications, HR decision-makers feel it will create a better health insurance package overall for employees, as well as boost their mental and physical health long-term," he said, noting that more than two-thirds of companies that added GLP-1s to their health care offerings experienced an increase in enrollment.
"For companies who are already offering this medication as part of their benefits, they've also seen higher employee satisfaction as a result," Wantuck said.
Nearly all (99 percent) of the employers that are covering GLP-1 drugs plan to keep covering them next year, the survey found.
The Accolade survey findings are significant, as they are among the first to gauge HR leaders' plans on offering the drugs.
Earlier this year, experts told SHRM Online employers were beginning to consider if they should cover the drugs for weight loss for their employees. The experts said although employees were expressing interest in the drugs, it was too early to tell what organizations would do, especially given the high costs of the medications as well as the fact that some of the drugs haven't been approved officially for weight loss.
Ozempic, for instance, is only approved for treatment of Type 2 diabetes, and employers primarily cover the drug for that diagnosis. Wegovy is also a diabetes medication, but it was approved by the U.S. Food and Drug Administration (FDA) for chronic weight management in 2021. Meanwhile, drugmaker Eli Lilly is seeking FDA approval for use of Mounjaro, another anti-diabetes medication administered weekly through injections, for the treatment of adults with obesity or those who are overweight and have weight-related comorbidities.
Employers Acknowledge Health Benefits
Employers might be persuaded to cover the drugs to get their employees healthier, the data indicates.
The Accolade survey, for instance, finds that three-fourths of HR decision-makers said GLP-1 medications are beneficial for controlling blood sugar, boosting weight loss, improving blood pressure and lowering the risk of heart disease.
"New studies come out every day that show the profound health benefits from losing a significant amount of weight," Wantuck said. "As scientific evidence mounts and novel medications in this class are approved, it will be harder and harder to justify noncoverage."
Helping control workers' weight could not only keep employees healthier and more productive, but also save on health care costs for the organization. Obesity is a significant contributor to company pocketbooks: A quarter of U.S. employers said obesity has the largest impact on overall health care costs, according to 2022 data from the International Foundation of Employee Benefit Plans (IFEBP).
Julie Stich, vice president of content at IFEBP, said in June that employer efforts to address weight loss are becoming more accepted.
"If the employer wants to help manage weight, that might make a positive impact on some of the resulting health conditions," Stich said. "In the workplace, we should get beyond any stigma surrounding weight and look to provide support, solutions and understanding. We should look at it when we talk about whole-person well-being."
Although the survey finds potential big momentum for the drugs, cost is still a concern.
Thirty-eight percent of HR leaders surveyed by Accolade cited the costs associated with GLP-1s as a potential barrier to providing coverage, while another recent survey by Virta found that the high costs of GLP-1s, driven by an anticipated rise in utilization, are a concern for the vast majority (72 percent) of health plan leaders.
That's for good reason: Drugs such as Ozempic cost more than $1,000 per month on average. And a significant number of employees may want to use the drug, which would substantially hike drug costs for employers. Plus, the drugs are not designed for short-term use. Studies show the weight will stay off only on continuation of the drugs, pointing to a long-term commitment for employers—and a much higher price tag.
But with increased employee interest, Wantuck said more employees are "going to expect and demand that their employers cover these impactful medications."
"For some employers this will overshadow the high costs associated with this medication—a barrier for many employers considering it," he said. "We expect that demand for GLP-1s will only increase in years to come, and there aren't any signs of it slowing down."