Biden Proposes Medicare, Medicaid Cover Anti-Obesity Drugs

The Centers for Medicare & Medicaid Services (CMS) announced plans on Nov. 26 to expand coverage of anti-obesity medications under Medicare Part D and Medicaid. The proposal, part of the Contract Year 2026 Medicare Advantage (MA) and Part D rule, reinterprets a statute that currently excludes weight-loss drugs, acknowledging obesity as a disease. CMS Administrator Chiquita Brooks-LaSure highlighted that this change addresses barriers to care and promotes healthier lives.

Previously, Medicare maintained it lacked authority to cover such drugs. By aligning this reinterpretation with policies for conditions like AIDS wasting, CMS aims to enable states to decide Medicaid coverage for GLP-1 drugs. However, the rule excludes coverage for individuals classified as overweight but not obese. Critics argue widespread use of GLP-1 drugs could strain healthcare budgets, with projected costs of $24.8 billion for Part D and $14.8 billion for Medicaid over time. CMS estimates 7% of Part D enrollees, or 3.4 million Americans, would become newly eligible for coverage.

Although CMS did not factor long-term savings into its cost estimates, officials downplayed potential premium increases, citing protections like the $2,000 out-of-pocket cap under the Inflation Reduction Act. Advocates, including the Health Equity Coalition for Chronic Disease, praised the move for addressing disparities in obesity care.

The proposed rule also addresses prior authorization (PA) and utilization management in MA plans. Changes aim to reduce denials and enhance transparency, including requiring MA plans to use utilization management committees. CMS also proposes safeguards to ensure AI tools in healthcare don’t lead to discrimination, along with improved provider directory accessibility through the Medicare Plan Finder.

Additional provisions include behavioral health reforms, limiting cost-sharing for mental health and substance abuse services, and zero cost-sharing for opioid treatment. CMS is also tightening oversight of marketing practices by brokers and agents to protect consumers.

The rule’s future remains uncertain, with the potential for changes under the next administration. Critics warn the high costs of GLP-1 drugs could make the policy unsustainable, while CMS maintains that the measures prioritize health outcomes and equity.

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