Health plan coverage of GLP-1s weighs heavily on employers’ minds
The trend of using prescription medications for weight loss started with celebrities and then spread like wildfire throughout the country.
These medications are glucagon-like peptide-1s (GLP-1s), with the most prescribed being semaglutide. They were first prescribed for managing type 2 diabetes but are now being used by a growing number of people to help them lose weight.
Nearly 12 percent of American adults have used GLP-1 drugs for weight loss, according to a report released in August by RAND, a nonprofit, nonpartisan research organization. That number is likely increasing.
Are insurance plans covering these drugs for weight loss?
Coverage of GLP-1 medications for weight loss may be a benefit employees want from employers. Covering them, however, could significantly increase an employers’ insurance costs.
In 2025, 36 percent of employers provide GLP-1 coverage for both diabetes and weight loss. This is up from 34 percent in 2024, according to the Society for Human Resource Management (SHRM). While slightly fewer employers (55 percent) provide coverage for diabetes only, SHRM says this is down from 57 percent in 2024.
When deciding whether to cover GLP-1s for weight loss, employers must consider the pros and cons.
Pros of covering GLP-1s
Some of the possible benefits of covering the cost of GLP-1 medications for employees include:
- Effective management of common conditions. GLP-1s are effective in improving glycemic control and promoting weight loss, which helps in managing type 2 diabetes and obesity. For employers, this may result in having healthier employees who are less likely to experience complications such as neuropathy or cardiovascular events, which may reduce the need for medical leave and disability claims.
- Enhanced worker productivity. Addressing weight issues and type 2 diabetes through treatments like GLP-1s may enhance employee productivity because obesity-related conditions can lead to lower job performance and higher absenteeism.
- Reduction of risk for more serious conditions. Studies show that GLP-1s offer heart protection, thus reducing the risk of heart attack, stroke, and cardiovascular death in patients with type 2 diabetes. Research has also shown a decreased risk of kidney conditions among GLP-1 users, as well. These benefits may lower an employer’s long-term health care costs and improve employee longevity and productivity.
- Greater overall wellness. Emerging research indicates GLP-1s may have applications beyond type 2 diabetes and obesity, such as reducing the risk of dementia and addiction. These added benefits could further enhance employee well-being, potentially decrease mental health-related absences, and support overall workplace wellness.
Cons of covering GLP-1s
The potential downsides of covering GLP-1 medications for employees include:
- Excessive cost. The cost of GLP-1 medications can exceed $1,000 per month per person, posing a significant financial burden. Employers may wonder about the return on investment, especially if they cover a lot of employees or their family members.
- Side effects. Some users of GLP-1s experience side effects, including nausea, vomiting, and diarrhea, which can affect employee comfort and productivity. These side effects, if severe, might cause some people to stop treatment. For employers, side effects could lead employees to have lower productivity, greater absenteeism, or increased health care costs as they look to manage side effects.
- Long-term effectiveness and sustainability concerns. While GLP-1s have been shown to be effective initially, benefits may decrease over time. Some research suggests that weight loss wanes after a year or two, with some patients regaining weight. Use of these drugs may not guarantee lasting results. Other treatments or interventions might be needed for continued treatment of diabetes and/or obesity. Employers should be aware that this could create a need for ongoing coverage, as long-term use of GLP-1s may not guarantee lasting outcomes.
- Possible legal liabilities for employers providing coverage. With GLP-1s there are risks of rare but serious adverse events, including pancreatitis, bowel obstruction, and gastroparesis (a chronic digestive disorder). Employers should discuss liability with their insurance provider before offering coverage to make sure risk management strategies are in place.
Key to remember: GLP-1s may help patients manage type 2 diabetes and obesity, which could improve long-term employee health and workplace productivity. However, these drugs are expensive, have side effects, and the long-term effects are still relatively unknown. Employers must consider these factors when deciding whether to provide coverage of these drugs.