Mirage News
Mirage News
Mirage NewsScience21 Jul 2026 6:30 am AESTDate Time
University of Mississippi
Despite growing evidence that GLP-1 medications improve health and are worth their cost, many insurance plans still limit coverage. University of Mississippi researchers are examining why, and where that leaves patients
A recent report from the Institute for Clinical and Economic Review, an independent nonprofit that evaluates the value of medical treatments, found that GLP-1s such as Ozempic, Wegovy and Zepbound are cost-effective, meaning the medication’s health benefits justify their price
In a study published in the Journal of Managed Care and Specialty Pharmacy , Sujith Ramachandran, associate professor of pharmacy administration , said that “cost-effective” does not necessarily mean “cost-saving” for insurance companies
“The ICER report shows that GLP-1s, at the cost that they are currently being sold, provide tremendous value to society,” he said. “But the impact they create on the budget is still massive
“That is happening because the patient population eligible for this medication is so large. So even if the medications themselves represent good value for society, that does not mean we, as a society, can take the impact of how many individuals would use this.”
According to the Centers for Disease Control and Prevention, some 40% of Americans are obese. Even if only a fraction of those patients sought GLP-1 treatment, insurers could face billions of dollars in additional costs
“ICER has a budget impact threshold that estimates whether the uptake of a drug can lead to a budget impact concern,” he said. “The threshold for this year is $821 million
“GLP-1s blow way past that threshold, even at lower numbers of uptake.”
A common argument for GLP-1 coverage is that its use could be a preventive measure that leads to long-term savings. But the data doesn’t back up that claim, Ramachandran said
“We expect that if we address the obesity issue in this country, then in theory, it should create savings down the road for cardiovascular conditions, liver conditions and kidney conditions,” he said. “But does that mean it actually produces savings? Well, the existing data do not show that.”
Patients often stop using GLP-1s within a year for a variety of reasons, including cost, meeting their goal weight or gastrointestinal side effects . In many cases, those patients regain the weight they lost
To make GLP-1s more cost-saving for insurers, the companies must help patients make the weight loss – and the associated decrease in risk for diseases associated with obesity – stick, Ramachandran said. That means not limiting GLP-1 coverage to six months or a year, as many insurers do, and providing the same support that made GLP-1s so effective in clinical testing
“The first thing to remember is that all of the clinical trials, GLP-1s were not tested against no treatment; they were tested against lifestyle management interventions,” he said. “It was not lifestyle management versus GLP-1; it’s lifestyle management versus lifestyle management plus GLP-1.”
This means that health care providers must offer patients more than the drug to deliver the desired benefits, Ramachandran said
“You have to provide them access to a registered dietitian, you have to provide them access to a gym membership, you have to provide them access to a fitness instructor or whatever network of services it is that you can provide to make sure that the change is in a lifestyle and not just in taking a medication once a week,” he said
For patients whose insurance won’t cover GLP-1 medications, lower-cost compounded versions can seem like an attractive alternative, but the researchers urge caution
Compounded GLP-1 drugs do not go through the same rigorous evaluation that the U.S. Food and Drug Administration-approved medications do, said Liang-Yuan Lin, an Ole Miss doctoral candidate in pharmacy administration who researches compounded drug pharmacies
“The FDA has already issued warning letters about compounded GLP-1s,” she said. “The FDA has found websites selling unapproved ingredients or even the wrong ingredients, which is terrifying for patients
“Even if they’re listing the right ingredients, you don’t know where these ingredients are from or how they’ve been transported or handled, which could be really dangerous.”
Lin and Ramachandran recommend that anyone seeking GLP-1 drugs consult with a physician both before they start and while they’re taking the medication to manage potential side effects, ensure safety and to make sure medication they receive is FDA-approved
“I, and I think most people, would hope that everybody who needs this medication gets it,” Ramachandran said. “But what we are seeing is that GLP-1 coverage is getting more accessible for specific conditions – sleep apnea, diabetes, extremely high BMI or a combination of these things – but for other conditions, coverage is probably going to get more restrictive
“But those compounding pharmacies are so dangerous. Those prices are more reasonable because these drugs are often not being manufactured correctly, and you don’t always know what you’re injecting in your body.”
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