Companies cap payments for staff’s Ozempic and Wegovy subscriptions at $20k per person per year – as overweight staff complain about dipping into their ‘retirement’ savings to keep going

Companies that rushed to provide weight-loss medications for their employees are facing rising costs and demand from employees, leading to cuts in health benefits or complete withdrawal of funding.

Since the rise of Ozempic, weight loss “miracle drugs” have become increasingly popular over the past two years, putting employers in a difficult situation.

One argument suggests that providing coverage for the medications that can improve employee health will reduce expenses in the long run and even help recruit and retain employees.

However, drugs like Wegovy and Zepbound have a high price tag, around $1000 per month, and can be used indefinitely rather than as a short-term solution to permanent weight loss.

Some companies, such as the Mayo Clinic, are responding to the dilemma by implementing a $20,000 limit on spending per employee.

Drugs like Wegovy and Zepbound come with a high price tag, about $1,000 per month

However, others, including the RWJBarnabas Health system in New Jersey, are eliminating their coverage all together.

The changes have left some overweight employees frustrated tells the Wall Street Journal they are forced to dip into their retirement savings to pay their medical bills.

Jason Krynicki’s, a obesity insurance coordinator in the RWJBarnabas Health system, received a discount on his Wegovy prescription coverage last month.

Krynicki, 41, told the Journal that he lost 47 pounds in less than a year by taking Wegovy, a subscription that cost him $25 a month, while his health plan covered the drug.

Now, however, his monthly bill exceeds $1,000, causing Krynicki to dip into his retirement savings to cover the costs.

“It’s just not fair,” Krynicki, who is also a board member of the advocacy group Obesity Action Coalition, told the Journal.

RWJBarnabas Health stopped covering the drugs for weight loss, but not diabetes, because a significant percentage of employees stopped taking them prematurely and regained the weight they lost, a spokeswoman explained.

“RWJBarnabas Health is not alone in making this decision.

Purdue University has limited coverage of weight loss medications after use doubled between 2022 and 2023

“Miracle drugs” for weight loss have become increasingly popular over the past two years, putting employers in a difficult situation

“Many employers have ended coverage for weight loss medications,” the spokeswoman added.

Purdue University has limited coverage of weight-loss drugs after use doubled between 2022 and 2023, and weight-loss therapies accounted for about 2 percent of total spending on the university’s health care plans last year.

The university will now only reimburse the medicines to employees with a body mass index (BMI) of at least 30, or at least 27 with another health condition.

Workers also need to lose about 5 percent of their body weight after three months to continue use.

The university is considering introducing further restrictions, including the possibility of requiring employees to pick up prescriptions at the employer clinic, which also provides nutrition, wellness coaching and mental health care.

Also to control rising costs, the Mayo Clinic, a nonprofit academic medical center, added a $20,000 lifetime limit on weight loss medications per employee starting Jan. 1.

North Carolina’s health plan for state employees recently decided to eliminate reimbursement for GLP-1s for weight loss starting in April after the plan’s use of the drugs increased sevenfold since 2021.

In a very short time, we are going to spend more on this drug than we did on cancer treatments last year,” state Treasurer Dale Folwell told the Journal.

A spokeswoman for Novo Nordisk told the publication that North Carolina’s decision to end coverage was irresponsible, adding that obesity and its associated conditions are driving up health care spending overall.

Ozempic and Wegovy are essentially the same drug, but each of the two brands contains a different amount of their active ingredient: semaglutide.

Originally developed to help treat diabetes, semaglutide proved to be an extremely effective appetite suppressant and is now widely used to aid weight loss.