Changes in Coverage for GLP-1 Drugs Amid Growing Demand

As the demand for GLP-1 medications rises, various American cities and states that once provided these weight-loss drugs to low-income individuals and government employees are now restricting or even removing that coverage.

This shift is largely driven by a noticeable increase in public spending on medications like Ozempic and Wegovy over recent years.

However, some lawmakers and healthcare professionals caution that cutting back on the availability of these drugs might offer immediate budget relief for governments but could harm the health of Medicaid recipients in the long run. They worry that this might lead to increased spending on obesity-related health issues later on.

“Access to these therapies is vital for patients,” commented Dr. Matthew Klebanoff, an internal medicine professor at the Perelman School of Medicine, where he researches GLP-1 drug coverage policies. “It’s quite tough for payers to manage covering them for everyone who would benefit.”

According to the Centers for Disease Control and Prevention, the obesity rate among adults in the United States reached 40% as of August 2023. Moreover, 12% of adults reported using a GLP-1 drug in November 2025, marking a 6% rise over the previous 18 months. This surge in drug use has coincided with a decline in the nationwide obesity rate, which fell to 37% in 2025, as per a Gallup report.

Despite these positive trends, the costs have skyrocketed. Spending on GLP-1 drugs jumped from $13.7 billion in 2018 to $71.7 billion in 2023—a staggering increase of 500%, according to a report published in Jama.

In October 2025, sixteen state Medicaid programs were covering GLP-1 drugs for obesity, though most provided them primarily for diabetes. By January 2026, states like California, New Hampshire, Pennsylvania, and South Carolina decided to stop this coverage, while Michigan limited it to those deemed morbidly obese. Rhode Island’s governor has even suggested halting coverage altogether.

Additionally, New York City’s health insurance plan for city employees discontinued coverage for GLP-1 drugs in 2025. Similarly, leaders in Boston are weighing limits on coverage due to significant insurance rate increases primarily attributed to the costs of these medications.

A budget shortfall is also looming over many states due to Donald Trump’s One Big Beautiful Bill Act, projecting a cut of $665 billion in Medicaid funding over the next decade.

“Any state currently providing these medications is likely re-evaluating its options,” Klebanoff remarked.

As a reference point, Medicaid spending on GLP-1 drugs in Pennsylvania hit $1.3 billion in 2025, which was double the expense from the previous year.

During recent budget talks, Pennsylvania’s Secretary of Human Services, Val Arkoosh, indicated that the state is considering cuts to ensure that medications are allocated efficiently based on need and cost-effectiveness, which might mean limiting access based on body mass index or other health factors.

In an emailed statement, a spokesperson for the department mentioned that some coverage reductions were due to “unsustainable cost increases from GLP-1 medications.”

Currently, Pennsylvania’s Medicaid program only covers these drugs for individuals with diabetes or those meeting stricter criteria, like having sleep apnea or a body mass index of at least 35.

State Representative Arvind Venkat, who is also a physician, expressed concerns: “We’re potentially allowing individuals to remain in poorer health than necessary before granting them access to a drug that’s proven to be safe.”

Alexa Canciello, a 23-year-old with autism living near Pittsburgh, has struggled with weight issues due to her brain’s inability to regulate hunger. After starting the GLP-1 drug Zepbound as a Medicaid recipient, she lost nearly 30 pounds. However, coverage for Zepbound was cut in January, leaving her family to pay over $400 a month out of pocket. Her doctor later switched her to a less effective pill version of Wegovy, which hasn’t worked as well.

“While some may succeed in losing weight through discipline and exercise, my daughter Alexa truly requires medication,” said her father, Rich.

In response to the ongoing challenges, Venkat has introduced legislation to create a subscription model for GLP-1 drugs, allowing the state to negotiate value-based agreements with manufacturers. This concept echoes a past deal made by Louisiana for a hepatitis C medication that established unlimited access for a flat fee over five years.

“The question isn’t just whether manufacturers will make such a deal, but if they want their product to reach the Pennsylvania Medicaid population,” Venkat noted.

Nevertheless, drug makers might lack motivation to opt into such agreements since the demand for GLP-1s is already high, according to Klebanoff.

The spokesperson for the human services department added that manufacturers haven’t shown interest in the proposed model.

Klebanoff believes that the market will eventually foster competition, leading to lower drug prices over time.

“Similar discussions took place during the introduction of hepatitis C treatments, and ultimately, competition drove the costs down,” he explained.

For now, Medicaid recipients will have to navigate ways to access these medications. Klebanoff suspects that an increase in sleep study requests might occur, as some individuals look for ways to qualify for GLP-1 drugs due to conditions like sleep apnea.

Venkat maintains that achieving state coverage for these medications is fundamentally a political issue. “If the sole aim is to save money in the immediate budget, the state may be succeeding,” he said. “But our goals should extend beyond that; we should prioritize public health.”