Dr Jeff Levin-Scherz Addresses Gaps in Obesity Care and Funding Challenges

At a recent Institute for Value-Based Medicine^® event hosted by The American Journal of Managed Care^® (AJMC^®) and University Hospitals in Cleveland, OH, AJMC sat down with presenter Jeff Levin-Scherz, MD, MBA, population health leader at WTW, about how obesity care varies depending on insurance coverage.

In this interview, Levin-Scherz highlights how Medicare Part D generally excludes obesity drugs such as glucagon-like peptide-1 (GLP-1) agonists from its coverage, while Medicaid coverage is limited to 10 states, and few marketplace plans cover these medications due to high costs. With drug costs posing a major barrier to obesity management, he also explains other routes patients can take to lose weight and how increased competition can help drive down costs.

Transcript

What are the main sources of funding for obesity care in the US, and where do you see significant gaps?

It depends on how people are insured. For instance, Medicare Part D is prohibited from covering drugs meant purely for obesity and, therefore, Medicare Part D plans don't cover these. Centers for Medicare & Medicaid Services [CMS] have allowed Medicare Part D plans to cover them for people with obesity and known cardiovascular disease, and some health plans are doing that, many are not. There are 10 states that cover GLP-1 drugs for their Medicaid beneficiaries, sometimes with restrictions, sometimes with relatively few restrictions, so the majority of people obviously live in states where this is not covered. On the marketplace plan where people buy individual health insurance, very few plans cover GLP-1s. They're expensive and they didn't build that into their rates, and also, they're very worried about potential adverse selection. So, recruiting populations that will actually need these drugs therefore will be expensive.

On the employer side, which is where I spend most of my time, 38% of the employers that we surveyed cover GLP-1s for obesity. Large companies, technology companies, energy companies are more likely to cover; smaller companies, companies in retail, [are] less likely to cover. Many companies have some sort of prior authorization in place because they're very expensive drugs. Some companies will put in place something beyond prior authorization, for instance, a requirement that people participate in some sort of a program or try medical weight loss and fail before they will get this covered. Obviously, the challenge is that these drugs are very effective, but they're also very expensive even after rebates and discounts.

Now, as a practical matter, there are other things that people can do for obesity. Bariatric surgery is actually very safe, very effective. It turns out it works by a mechanism pretty similar to the way these these obesity drugs work, and many more employers cover bariatric surgery. On the flip side, people really need to go to a center which has a multidisciplinary team; they should go to a place where a lot of bariatric surgery is done. It's much more disruptive in life than starting a medicine—even if you have to give injections once a week, getting major surgery is a much bigger deal. And bariatric surgery just doesn't scale as well. I think the estimate is right now that about 1% of people who are eligible have gotten bariatric surgery.

The third thing to mention is that there are many people that do get some benefit from various programs, ranging from going to see a nutritionist to actually very formal programs that might include apps that encourage more exercise [and] encourage more nutritious food. The reality is that for people with body mass indexes (BMIs) that are 35 or more, generally, behavioral modification is not likely to lead to medically significant weight loss. But it does in some people, so people should always be thinking about that as an option.

What innovative funding strategies do you propose to address the rising costs of obesity care?

Clearly, in the United States, these medications are dramatically more expensive than they are elsewhere. For instance, in other wealthy countries—countries like the United Kingdom or like Japan—these drugs are available, at least for diabetes, and they cost about a tenth as much as they cost now. Government regulation to lower prices clearly would be helpful. It's possible, now that semaglutide has been approved by CMS for people with obesity and existing cardiovascular disease, it's possible that Medicare will be negotiating the costs for semaglutide as Wegovy at some point over the next couple of years, so that could actually lower prices.

Clearly, what everybody's hoping for there is that we will see competition to lower prices, and there are about 100—maybe a little bit more than 100—different molecules that are currently in clinical trials. And if we had more than 2 companies providing medication, the price would probably go down, might go down very significantly. It'd be nice to think about patents ending. Liraglutide, which is Saxenda, is a once a day rather than once a week injectable medication; it leads to much lower rates of weight loss than semaglutide or tirzepatide. It goes off patent this year, and people are expecting to see generic versions by 2026 or 2027. That could also lower prices, although again, it is a less effective drug than the newer drugs—they're not going off patent until until the mid 2030s.

Clearly, there are other things that I would like to see. When the hepatitis C drugs—also very expensive and also very effective—initially came out, they cost about $100,000, and there were some states including Louisiana that developed a subscription model. So, they would pay the pharmaceutical company a set amount, [and] the pharmaceutical company would provide as much medicine as needed. I think that's actually a very good model, and I'd love to see that. The reality is, there's right now a shortage of supply of both semaglutide and tirzepatide, the 2 very effective drugs, so clearly the manufacturers don't have any incentive to provide less expensive medication when they can sell every unit they produce for a very high price.

This transcript has been lightly edited for clarity.