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Cigna launches effort to cap employer insurance plan spending on weight loss drugs

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Injection pens of Novo Nordisk’s weight-loss drug Wegovy are shown in this photo illustration in Oslo, Norway, Nov. 21, 2023.

Victoria Klesty | Reuters

Cigna on Thursday unveiled a new effort to expand insurance coverage for weight loss drugs by limiting how much health plans and employers spend on the highly popular treatments each year. 

The move comes as many insurers mull whether they should cover those drugs or drop them from their plans altogether due to their high costs. Americans have flocked to the treatments, along with similar diabetes drugs, despite their hefty price tags of roughly $1,000 per month.

The move by the insurance giant Cigna could make weight loss treatments more accessible. Most insurance plans cover diabetes treatments.

Cigna’s pharmacy benefits management unit struck agreements with drugmakers Novo Nordisk and Eli Lilly that aim to limit spending increases for weight loss and diabetes drugs to a maximum of 15% annually, a company spokesperson told CNBC. Currently, some health plans are seeing spending on the drugs increase 40% to 50% annually, according to the spokesperson. 

Cigna did not provide further details on what those agreements look like. But the company will likely address the effort during its investor day on Thursday.

Eli Lilly and Novo Nordisk did not immediately respond to requests for comment on the agreements with Cigna’s Evernorth unit.

The company called the effort the healthcare industry’s “first financial guarantee” for coverage of the drugs, which are also known as GLP-1s. Those medicines treat weight loss and diabetes by mimicking one or more hormones produced in the gut work to suppress appetite and regulate blood sugar.

Cigna said providing “financial predictability” through a cost cap will allow health plans and employers to better plan to manage GLP-1 spending. That, in turn, would help ensure broader access for eligible patients.

An October survey of 205 companies by the International Foundation of Employee Benefit Plans found 76% of respondents provided GLP-1 drug coverage for diabetes, versus only 27% that provided coverage for weight loss. But 13% of plan sponsors indicated they were considering coverage for weight loss.

The effort expands an existing program under the Evernorth unit called EncircleRx, which targets patients with diabetes, obesity and cardiovascular disease. 

Health plans and employers pay Cigna a separate monthly fee for that program. The program includes support for patients on the drugs, which are supposed to be accompanied by lifestyle changes such as diet and increased exercise.

Cigna is also working with Omada Health on services to help patients with behavior changes.



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