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Medicaid spending on GLP-1 drugs has grown rapidly in recent years, according to a study published on November 4 by health policy research firm KFF.
Medicaid GLP-1 prescriptions rose 400% and gross spending rose more than 500% from 2019 to 2023, according to KFF’s analysis. Before rebates, spending on GLP-1s accounted for more than $900 per prescription in 2023.
Spending has picked up even further in the last couple years as new players including Wegovy and Mounjaro came to market, with the number of Medicaid prescriptions and gross spending on GLP-1s both almost doubling between 2022 and 2023, the researchers found.
“Many state Medicaid programs are considering covering obesity drugs in the future but are concerned about the cost implications,” the study’s authors wrote.
Expanding coverage. Currently, 13 states offer Medicaid coverage for GLP-1s used for obesity treatment.
Officials from half those states told KFF researchers in a survey that they were considering adding coverage. Many states are trying to determine whether the short-term cost pressures of covering the drugs are worth the potential long-term cost savings associated with lowering the rates of obesity-related diseases, like heart disease and Type 2 diabetes, according to the study.
Roughly 40% of adults and 26% of children with Medicaid have obesity, according to KFF, so expanding coverage could significantly increase patient access to GLP-1s.
Ozempic, Wegovy, and Mounjaro are currently the most popularly prescribed GLP-1s in Medicaid, with Ozempic prescriptions close to doubling every year since 2019, according to KFF. Wegovy was approved in 2021 and Mounjaro in 2022, and in the last couple years, spending on both drugs has increased twelvefold or more, researchers found.
Novo Nordisk, the drug manufacturer that makes both Ozempic and Wegovy, reported Q3 2024 results on November 6 that showed Wegovy sales increased 79% in the quarter to $2.5 billion, while Ozempic sales grew about 26% to $4.3 billion.
Eli Lilly, which makes Mounjaro, reported on October 30 that Mounjaro sales totaled $3.1 billion in Q3 2024, up about 120% from the same quarter in 2023.
As of 2023, all GLP-1s made up roughly 0.5% of Medicaid prescriptions compared to 0.01% in 2019, and 3.7% of gross spending, compared to 0.9% in 2019.