Medicare’s annual expenses for Wegovy, an obesity drug, could reach triple-digit billions of dollars if the U.S. Congress decides to expand coverage. This move would include drugs with cardiovascular benefits for patients at risk of cardiovascular events. Novo Nordisk, the company behind Wegovy, has been advocating for the drug’s inclusion in Medicare coverage.
The company’s CEO has defended the pricing, emphasizing the long-term health benefits and cost-effectiveness compared to healthcare costs associated with untreated obesity and cardiovascular diseases. However, some lawmakers and healthcare analysts have expressed concerns about the financial burden on the Medicare system. Senator Bernie Sanders has voiced concerns that including such expensive treatments could strain the healthcare system’s resources.
Recent studies suggest that Medicare subsidies could enable millions of patients to access Wegovy, potentially improving public health outcomes. As the debate continues, stakeholders await Congress’s decision, which could set a precedent for the future inclusion of high-cost drugs in public health insurance programs.
Medicare costs for expensive obesity drug
Around one in seven Medicare beneficiaries with a high body mass index (BMI) may be newly eligible for semaglutide treatment after Medicare allowed Part D plans to cover the drug for patients with a BMI ≥ 27 and a history of cardiovascular disease (CVD), regardless of their diabetes status. A study found that 3.6 million individuals (14.2%) were deemed highly likely to qualify for semaglutide treatment for the first time. Broadening the criteria for established CVD could increase this number to 15.2 million individuals (60.9%).
If all newly eligible beneficiaries were to receive semaglutide treatment, Medicare spending could increase by $34-$145 billion annually. Even with more conservative definitions of CVD and a significant portion of individuals not maintaining long-term adherence to semaglutide treatment, costs could still increase by $10 billion annually. Younger, generally healthier female Medicare beneficiaries were still likely to remain ineligible for semaglutide treatment according to the coverage provided by Part D Medicare plans.
The analysis relied on self-reported cases of CVD and was limited to only community-dwelling adults. It estimated maximum budgetary impacts but did not account for payment reforms introduced by the Inflation Reduction Act or for absolute contraindications to semaglutide.
- MedWatch.”Medicare’s annual expenses for Wegovy could reach triple-digit billions of dollars”.
- Medscape.”Semaglutide Coverage Could Raise Medicare Costs by Billions”.
- SeekingAlpha.”Medicare coverage of Novo Nordisk’s Wegovy could cost up to $145B annually”.