Russell Wooten and his grandchildren spend time at home in Hendersonville, N.C. GLP-1s helped the 54-year-old public employee lose 40 pounds, but the North Carolina State Health Plan no longer covers the expensive weight loss drugs. (Courtesy of Russell Wooten)
Russell Wooten of Hendersonville, North Carolina, has spent much of his life struggling with obesity, often carrying 260 pounds on his 6-foot-3 frame. He repeatedly starved himself to lose weight, then gained it back by binge eating comfort foods. The cycle left him feeling “depressed and distraught.”
In February 2023, Wooten began taking Wegovy, one of a class of drugs called GLP-1s. Long prescribed to patients with Type 2 diabetes and cardiovascular conditions, these medications balance blood sugar levels, but they also curb hunger signals and can help people lose significant amounts of weight.
Wegovy helped Wooten, a custodian at a local public school, lose 40 pounds. But his joy was short-lived: Last April, the North Carolina State Health Plan for teachers and other public employees stopped covering the drug for weight loss. The list price for Wegovy tops $1,300 per month — far more than Wooten can afford on his $45,000 salary.
“It was working for me. I was exercising. I felt better than I had in a very long time,” said Wooten, 54. “It’s like somebody giving you a Ferrari and then taking it away.”
The skyrocketing popularity of the weight-loss drugs is fast becoming a state budgetary concern. In deciding whether to cover the medications, policymakers must choose between the long-term benefits of reducing obesity among public employees and their families — which could cut spending on the treatment of chronic diseases — and the short-term costs.
Separately, 13 state Medicaid programs, including North Carolina’s, have opted to cover GLP-1s for obesity. But Medicaid is jointly funded by the federal government and the states, and drugmakers are required to offer significant rebates to those programs in exchange for coverage of their products. The insurance plans that cover public employees largely have to bear the costs themselves.
About a dozen states last year considered legislation that would have added coverage of GLP-1 weight-loss medications to state health plans, Medicaid, or policies offered on Affordable Care Act marketplaces. Most failed or didn’t advance. West Virginia, like North Carolina, had been covering the drugs for state employees but stopped doing so. Its move affected far fewer people, however, because its initiative was a limited pilot program.
Meanwhile, Illinois last year approved coverage for its public employees, and Connecticut officials say they will keep covering the drugs, which they began doing in 2023, despite the high price tag.
“North Carolina is wrong, because when employees are healthy, they’re more productive,” said Connecticut Comptroller Sean Scanlon, a Democrat.
Costs and benefits
Dr. Nicholas Pennings, chair of family medicine at Campbell University in Buies Creek, North Carolina, saw many patients on the employee state health plan gain back the weight they had lost after their GLP-1 coverage ended. That’s because obesity is a chronic condition that can be caused by genetics, emotional dependency and lack of healthy food access, Pennings said.
In North Carolina, where 70% of residents are overweight or obese, foods such as barbecue pork and peach cobbler are part of the local culture. Pennings said he has patients, including the children of state employees, who were doing well on GLP-1s but are now headed toward developing diabetes.
The North Carolina State Health Plan, which covers nearly 750,000 employees, retirees and their dependents, started paying for GLP-1s for weight loss in 2015. By 2023, 23,215 beneficiaries were on the drugs, up from 2,795 in 2021 — an increase of 731%. With various discounts and rebates, the health plan was projected to spend $170 million on the medications in 2024.
The state health plan spends a total of about $4.13 billion annually to provide coverage to people who work for state agencies, universities, community colleges and local school systems. Of that total, state taxpayer dollars cover about 84% and employee premiums cover the remainder.
In the long term, covering weight-loss drugs could result in lower spending on chronic diseases associated with obesity, such as diabetes, heart disease and certain types of cancer, researchers say. But Dale Folwell, the former Republican state treasurer of North Carolina who was in office when the plan stopped covering the medications, said it was an investment the state couldn’t afford to make.
“The whole issue about weight-loss drugs and their cost came at us like a top fuel dragster at 300 miles an hour,” Folwell said. “It’s not emotional, it’s not political, it’s mathematical.”
The state health plan currently has a $507 million deficit. Pharmacy benefit managers, the intermediaries in the drug supply chain, are supposed to use their bargaining power to negotiate lower drug prices, and Folwell said the state’s PBM has secured rebates on the weight-loss drugs. But they weren’t enough.
Brad Briner, who replaced Folwell as treasurer earlier this month, said the state considered cutting costs by limiting coverage to the most high-risk patients, but the state’s current contract with its PBM would not allow that. He hopes that the state’s next PBM contract will allow more flexibility, and that the state will resume covering the drugs for at least some patients next year.
In the meantime, Briner said, eliminating coverage was the right decision.
“We’ve got to balance the books before we add GLP-1s back,” said Briner, also a Republican.
As in North Carolina, more than 70% of West Virginia residents are overweight or obese. The state’s Public Employee Insurance Agency, which oversees the state’s health plan, in March 2024 ended its small pilot program that covered about 1,100 enrollees, due to concerns over cost and supply.
The agency said in an email that the program cost $1.3 million per month. If it had extended coverage to all potential eligible members, about 70,000 people, the projected cost would have been more than $1 billion annually.
Dr. Laura Davisson, director of the Medical Weight Management program at West Virginia University, one of the sites of the obesity treatment pilot program, wrote in an email to Stateline that her patients saw on average a 15% weight loss, which is “three times as much weight as lifestyle-only programs.”
“The challenge is that the benefits of treating obesity, such as preventing long-term complications, may not become evident for several years,” Davisson wrote to Stateline.
Staying the course
In Illinois, Democratic Gov. JB Pritzker pushed to provide coverage of the weight-loss drugs for public employees. The Pritzker administration estimates that doing so will cost the state $210 million in the first year, but some economists say the cost is likely to be as much as three times higher.
In Connecticut, the cost of covering the weight-loss drugs for public employees has skyrocketed from $7.7 million in 2020 to an estimated $40 million last year. The Connecticut state health plan has about 270,000 beneficiaries.
In an attempt to control costs, the state in 2023 began requiring patients seeking a GLP-1 prescription for weight loss to first enroll in a telehealth program to help them make lifestyle changes instead of using the medications.
Scanlon, the state comptroller, said the program has reduced GLP-1 usage but enrollment is surging. Now the state is looking for its next solution, he said.
“Our North Star has always been continuing coverage for people who want to get the help that they need and that they deserve,” he said.
One thing Scanlon is not counting on, he said, is the price of the GLP-1 drugs coming down anytime soon.
“Trying to convince the makers of these drugs to make them cheaper is like me trying to convince my 2-year-old and 5-year-old not to want to eat candy in a candy store,” Scanlon said.
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