Navigating the Shift: Wegovy and Other Drugs Now More Accessible Under Revised Medicare Rules
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In a pivotal update, the Centers for Medicare & Medicaid Services (CMS) have revised the guidelines for Medicare Part D, the government-sponsored drug benefit plan, to potentially expand coverage for weight loss drugs, as reported by The Wall Street Journal. This change follows closely on the heels of the FDA’s recent approval of the weight loss drug Wegovy for reducing the risk of cardiovascular diseases in certain patients.
What is Medicare Part D?
Medicare Part D, established under the Medicare Prescription Drug, Improvement, and Modernization Act of 2003, offers a voluntary outpatient prescription drug benefit for Medicare beneficiaries. This program is implemented through private plans contracted with the federal government, allowing enrollees to choose between stand-alone prescription drug plans (PDP) to supplement traditional Medicare or Medicare Advantage plans that include prescription drugs (MA-PD). Over 50 million of the 65 million Medicare beneficiaries are enrolled in Part D plans as of 2023.
Medicare Part D May Expand Coverage
Historically, Medicare Part D has excluded coverage for medications prescribed solely for weight loss due to concerns about their safety and effectiveness, which date back to the 1990s. However, the recent CMS guidance marks a significant shift, allowing coverage of anti-obesity medications like Wegovy, provided they are approved for additional health benefits, such as reducing the risk of heart attacks and strokes.
This policy change is informed by the FDA’s approval of Wegovy on March 8 for reducing cardiovascular death, heart attack, and stroke risks in adults with a history of heart disease who are obese or overweight. The approval was based on a phase 3 trial that demonstrated a 20% reduction in major adverse cardiovascular events in a study involving more than 17,000 participants.
Under the new guidance, medications will be covered if they are used for conditions with approved health benefits rather than solely for weight loss. Furthermore, Part D plans may require prior authorization to ensure these drugs are used for federally recognized, medically accepted purposes.
This shift is crucial considering the prevalence of obesity among U.S. adults aged 65 and older, which exceeds one-third. Obesity is linked with numerous health issues, including high blood pressure and Type 2 diabetes, and significantly increases the risk of mortality.
The financial implications are significant, with medications like Ozempic and Mounjaro often costing over $1,000 per month without insurance. These drugs have become some of the top-selling drugs under Part D, with spending on Ozempic alone skyrocketing from $2.6 billion in 2021 to $4.6 billion in 2022, according to a report from the Kaiser Family Foundation (KFF). See Figure 1 & 2 Below from KFF.
As Medicare broadens its drug coverage criteria, this could pave the way for more preventative measures in healthcare, potentially reducing severe health outcomes for millions while scrutinizing the high costs of these medications. The debate over drug prices is particularly intense, highlighted by Sen. Bernie Sanders' recent investigation into the "outrageously high prices" of Novo Nordisk’s drugs. In his critique, Sanders emphasized the stark contrast in pricing between the U.S. and other countries: for example, Ozempic costs $969 per month in the U.S. for Type 2 diabetes, compared to $155 in Canada and $59 in Germany. Sanders' concerns reflect a broader issue of accessibility to potentially life-changing treatments, which are priced significantly higher in the U.S. than in other countries.
This evolving policy landscape represents a critical moment in public health strategy, balancing between fostering medical innovation, enhancing patient care, and managing healthcare costs as the nation grapples with an escalating obesity crisis.