GLP‑1 medications such as Ozempic®, Wegovy®, and Zepbound®—originally developed to treat Type 2 diabetes—have rapidly become some of the most prescribed drugs for weight management. While their clinical benefits are clear, their high costs are reshaping employer health plans in 2025 and creating pressure on pharmacy benefit budgets.

Why GLP‑1s Are Driving Benefit Costs

According to the International Foundation of Employee Benefit Plans (IFEBP), GLP‑1 medications now account for more than 10% of annual prescription claims within many employer-sponsored health plans—up sharply from 6.9% in 2023. AssuredPartners reports that per-member-per-month costs tied to GLP‑1 prescriptions have increased from $1.43 in 2019 to $24.59 in 2024, representing a staggering 77% annualized growth rate.

Mercer’s 2025 employer survey indicates that over half of large employers (51%) plan to shift more healthcare costs to employees by 2026, largely due to the financial impact of high-cost specialty drugs like GLP‑1s. Additionally, 34% of employers are exploring alternative pharmacy benefit manager (PBM) arrangements to mitigate escalating spend.

Coverage Trends: Limited and Conditional

IFEBP research shows that while 55% of employers cover GLP‑1 drugs for diabetes treatment, only 36% offer coverage for weight-loss indications. Among those covering GLP‑1s for weight loss, most impose strict clinical requirements, such as BMI thresholds or proof of obesity-related conditions. A July 2025 survey by WTW found that 52% of employers offering coverage now require participation in structured lifestyle or wellness programs as a condition of approval.

Brown & Brown’s June 2025 employer survey revealed that nearly 60% of organizations that currently cover GLP‑1s have already implemented restrictions, and roughly one-third are evaluating whether to scale back or eliminate coverage within the next two years.

How Employers Are Containing Costs

• Prior Authorization and Clinical Criteria: Employers increasingly require detailed physician documentation, including BMI verification or diagnosis of weight-related comorbidities, before approving GLP‑1 prescriptions.
• Step-Therapy Protocols: Many plans mandate trying lower-cost therapies or traditional weight-management options before GLP‑1 coverage is granted.
• Lifestyle Program Integration: Coverage is often tied to participation in employer-sponsored wellness initiatives, such as nutritional counseling or behavior coaching, to promote sustainable results.
• Value-Based Formularies: Some employers work with PBMs to negotiate formulary placement based on clinical outcomes and rebate transparency.
• Coverage Carve-Outs: A growing number of employers cover GLP‑1s only for diabetes treatment, excluding weight-loss use entirely to limit financial exposure.

Employee Sentiment and Retention Risks

A recent Employee Benefit Research Institute (EBRI) study found that 64% of employees believe GLP‑1s should be included in their health plan coverage, yet nearly half of respondents were unsure if their current plan provided access. The Wall Street Journal has described GLP‑1 coverage as “the next big workplace benefits dispute,” underscoring its role in recruitment and retention strategies.

Action Steps for Employers

• Audit Pharmacy Spend: Evaluate current and projected GLP‑1 utilization within your health plan to quantify budget impact.
• Refine Coverage Guidelines: Establish clear eligibility standards, such as BMI and comorbidity requirements, and define program duration limits.
• Revisit PBM Contracts: Negotiate rebate transparency and consider value-based agreements tied to clinical outcomes.
• Integrate Behavioral Support: Link GLP‑1 prescriptions with ongoing wellness programs to improve adherence and cost-effectiveness.
• Communicate Benefits Clearly: Educate employees about coverage parameters to set realistic expectations and minimize confusion.

Atria’s Advisory Support

At Atria, we work with tribal enterprises and mid-market employers to design pharmacy benefit strategies that balance affordability, compliance, and employee satisfaction. Our services include:

• Pharmacy claims analysis and forecasting
• PBM contract review and negotiation
• Development of eligibility and utilization criteria
• Benefit communications planning and employee engagement

Concerned about GLP‑1 costs and coverage strategy? Contact Atria to develop a data-driven plan that protects your budget while supporting employee health needs.

This article is for informational purposes only and should not be considered legal or tax advice.