Weight loss medications continue to have a significant impact on employer-sponsored health plans. While these therapies offer meaningful clinical benefits for conditions such as diabetes and obesity, they are also contributing to increased health care costs for many organizations. For example, glucagon-like peptide-1 drugs used for weight loss, commonly called GLP-1s, accounted for 11.4% of total annual claims costs for employers who covered them in 2025, according to the International Foundation of Employee Benefit Plans.
The GLP-1 landscape continues to evolve rapidly. Additional medications are entering the market, new indications are being approved, oral formulations are becoming available and dosing schedules are becoming more convenient. At the same time, GLP-1 demand remains strong for treating both diabetes and weight management. As a result, many employers are evaluating how to balance access to these therapies with long-term plan affordability.
Against this backdrop, we recently convened a roundtable discussion with the Vanderbilt Health Employer Advisory Council to explore how organizations are approaching GLP-1 management. Four key strategies emerged from the discussion:
1. Utilization Management
Many employers are strengthening utilization management programs to ensure GLP-1s are used consistently with plan design and clinical criteria. Strategies may include prior authorization requirements, minimum BMI thresholds, comorbidity requirements and participation in lifestyle modification programs. These approaches can help ensure GLP-1 medications are accessible to those who may benefit the most, while also managing financial exposure.
2. Financing Mechanisms and Subsidy Models
Employers that choose not to cover GLP-1 drugs for weight loss often look for alternative ways to support employees. Flexible Spending Accounts (FSAs), Health Savings Accounts (HSAs) and Health Reimbursement Arrangements (HRAs) can help offset out-of-pocket costs. HRAs allow employers to define contribution levels and eligibility criteria, creating greater budget predictability while still providing some level of support.
3. Vendor Partnerships
Many employers that cover GLP-1 medications for weight loss leverage specialized weight management vendors to help with access, coaching, engagement and outcomes. These arrangements may operate outside of a traditional pharmacy benefit manager relationship.
One employer participating in our discussion shared that their organization is evaluating a model that would provide GLP-1 access through a weight management vendor, effectively separating the cost of these medications from the traditional health plan. Another employer highlighted the opportunity for vendors to support appropriate discontinuation and maintenance strategies that help sustain clinical outcomes while potentially reducing long-term costs.
4. Direct-to-Employer Pricing Models
Several manufacturers now offer programs that enable employers to access GLP-1 medications through direct pricing arrangements administered by independent partners. These models may offer an alternative pathway for organizations looking to manage costs while maintaining employee access.
A Balanced and Strategic Approach
Managing GLP-1 therapies requires a thoughtful, multifaceted strategy. Employers must balance the well-established clinical benefits of these medications with the financial realities of providing coverage. While many expect costs to decline as competition increases and the market evolves, organizations are making important coverage and budgeting decisions today. As one employer noted during our discussion, if GLP-1 drugs were priced similarly to widely used medications such as statins or blood pressure therapies, the conversation around coverage might be different. Until more affordable options become available, employers will continue exploring a combination of utilization management, financing solutions, vendor partnerships and alternative purchasing models to support both employee health and plan sustainability.
Want more insights on GLP-1 strategies? Looking for additional insights and best practices from our employer solutions team? Let us know at employersolutions@vumc.org.