As GLP-1 medications continue to gain prominence for treating diabetes, obesity, and other emerging health conditions, employers face growing challenges in managing their impact on healthcare benefits and costs. These specialty drugs are clinically effective but come with high price tags and complex coverage considerations. For employers planning benefits in 2026 and beyond, understanding GLP-1s and adopting strategic approaches is essential to balance employee health needs with financial sustainability.
Here are five critical actions employers should take to navigate the evolving GLP-1 landscape effectively.
#1: Understand How GLP-1s Work and Their Clinical Importance
GLP-1 medications mimic a natural hormone that regulates blood sugar and appetite. They improve insulin use in patients with diabetes and suppress appetite to support weight loss. These drugs have shifted from being last-resort treatments to first-line options for certain high-risk patients, especially those with diabetes complicated by heart or kidney issues.
Employers need to understand these clinical benefits because GLP-1s are increasingly prescribed, influencing employee health outcomes and driving utilization trends that affect plan design and costs.
#2: Recognize the Significant Cost Impact and Market Dynamics
Pharmacy spending now accounts for the most significant and fastest-growing share of healthcare costs, with GLP-1s contributing disproportionately. Monthly costs for weight loss drugs like Wegovy and Zepbound range from $349 to $599, making them a major budget consideration.
Only about a quarter of employers currently cover weight-loss GLP-1s due to their high costs. However, ongoing price competition between manufacturers and emerging direct-to-consumer options is reshaping the market, offering new opportunities and challenges for cost management.
#3: Implement Robust Coverage Controls and Prior Authorization
To manage utilization and prevent off-label use, employers should work with pharmacy benefit managers (PBMs) to enforce strong prior authorization (PA) processes. These require clinical documentation to approve prescriptions, ensuring that only eligible patients receive GLP-1s.
Adjusting eligibility criteria such as BMI thresholds or comorbidity requirements can further focus coverage on those who need the medication most, helping control plan costs while supporting appropriate clinical use.
#4: Integrate GLP-1 Access with Holistic Wellness and Weight Management Programs
Simply covering GLP-1 drugs is not enough to achieve sustainable health outcomes or cost savings. Employers should pair medication access with extensive wellness programs that promote lifestyle changes, behavior coaching, and ongoing support.
Programs like Noom or Weight Watchers, combined with clinical oversight, improve adherence and help employees maintain weight loss without indefinite reliance on medication, ultimately benefiting both health and plan budgets.
#5: Explore Direct-to-Consumer and Cash Pricing Strategies to Expand Access
Direct-to-consumer (DTC) models and cash-pricing options are emerging as innovative ways to provide employees with access while managing employer costs. Subsidizing part of employeesโ out-of-pocket expenses through debit cards or reimbursement programs can leverage lower cash prices outside traditional benefit plans.
This approach offers an off-ramp for employers hesitant to cover GLP-1s while still meeting employee demand fully. However, it requires careful coordination to maintain clinical oversight and ensure safe use.
Final Thoughts
GLP-1 medications present both opportunities and challenges for employers managing healthcare benefits. By understanding their clinical role, controlling costs through coverage strategies, integrating wellness programs, and leveraging new access models, employers can better support employee health while maintaining financial balance. Staying informed and proactive will be key as the GLP-1 market continues to evolve.
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James Tuft
James Tuft is a Vice President for Hortonโs Employee Benefit Solutions. He is responsible for providing expert employee benefits consulting, bringing new clients on board, and servicing and retaining existing clients. He is part of a team of employee benefits-focused specialists dedicated to delivering innovative healthcare solutions to employers.
Material posted on this website is for informational purposes only and does not constitute a legal opinion or medical advice. Contact your legal representative or medical professional for information specific to your legal or medical needs.
