Most state Medicaid applications don’t cowl the brand new class of weight reduction medication for weight problems, however that might quickly change. Half of people who don’t are contemplating including protection, per a brand new KFF report.
Whereas all state Medicaid applications cowl GLP-1 agonists for kind 2 diabetes, it’s a lot much less widespread for them to cowl the medication for weight problems. At the moment, simply 13 state Medicaid applications cowl GLP-1s for weight problems. Many of the states that don’t cite the medication’ excessive price.
Now, “state curiosity in protecting weight problems medication is rising,” mentioned Liz Williams, a senior coverage analyst in KFF’s Program on Medicaid and the Uninsured. KFF’s twenty fourth annual survey of state Medicaid administrators drew responses from 49 state Medicaid applications plus Washington, D.C.
The potential for expanded protection beneath Medicaid comes as personal plans are beginning to aggressively crack down on protecting the drugs for weight problems. Medicare prohibits protection of the medication for that indication.
KFF’s report notes a rise in spending on GLP-1 medication in Medicaid applications beginning in 2021. The report mentioned internet Medicaid spending on prescribed drugs grew 72% between fiscal 12 months 2017 and monetary 12 months 2023, and prescribed drugs accounted for about 6% of whole Medicaid spending in that point. KFF mentioned a lot of the spending development lately is due to new, high-cost specialty medication, together with GLP-1s and rising cell and gene therapies.
Among the many 13 states that presently cowl GLP-1s for weight problems, KFF’s report says 11 cowl all three of the medication presently authorised for that indication: Saxenda, Wegovy, and Zepbound. (KFF’s report says 12 states and never 13 as a result of it was launched earlier than North Carolina started protecting the medication for weight problems.)
The report notes that South Carolina plans so as to add protection for weight problems on the finish of 2024, and Connecticut has a legislative mandate so as to add protection but it surely has not but been carried out. 4 extra states have protection in place however just for older medication that aren’t GLP-1s.
The principle issue state Medicaid officers should weigh is the excessive price of protecting the medication, whose listing worth is no less than $900 monthly. Some states require legislative approval so as to add protection, and they might additionally have to develop scientific standards.
On the flip aspect of the prices, Williams mentioned officers are contemplating the potential for price financial savings years down the street, if members who use the drugs keep away from growing different well being circumstances because of this. 4 in 10 states mentioned the potential for optimistic well being outcomes was an element of their protection choices, in response to the report.
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Most of the states that do cowl GLP-1s for weight problems beneath Medicaid have physique mass index necessities and different standards sufferers should meet earlier than the medication are coated, in response to a report by the actuarial agency Milliman. In Mississippi, for instance, sufferers should qualify primarily based on their BMI and so they’re evaluated on their progress towards weight reduction objectives.
For its report, KFF acquired responses from officers in 50 states throughout the summer season of 2024. Their responses concern fiscal years 2024 and 2025, which covers a interval of uncertainty for the applications. Medicaid applications had been prohibited from disenrolling members throughout the Covid-19 pandemic in change for extra money from the federal authorities. Starting final 12 months and ending earlier this 12 months, states needed to comb by way of their membership and decide who was nonetheless eligible for Medicaid.
Whereas the redetermination course of is over, states are nonetheless ready to be taught extra concerning the well being standing and prices of the members that stay on the applications. The idea has extensively been that the individuals who stay on this system are sicker and require extra care, and well being insurers are reporting that to be the case. KFF’s report says two-thirds of the states whose applications use personal insurers mentioned they sought federal approval to amend their charges to account for higher-cost members.
Regardless of steady budgets presently, over half of the states that responded to KFF’s survey mentioned there’s a 50-50 or larger likelihood of a Medicaid funds shortfall within the coming 12 months. That’s a big change from final 12 months’s survey, when most states didn’t anticipate income shortfalls. They cited declining Medicaid enrollment coupled with greater prices per enrollee, plus the long-term potential for rising high-cost prescribed drugs, the excessive price of medical care, and workforce challenges.
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The truth that states have already spent most of their federal pandemic help is one more reason Medicaid administrators say they might face funds shortfalls, in response to Kate McEvoy, govt director of the Nationwide Affiliation of Medicaid Administrators, which collaborated on the KFF report. The Congressional Funds Workplace tasks states will obtain $58 billion much less from the federal authorities in fiscal 12 months 2024 than they did within the prior fiscal 12 months. Due to that, Medicaid officers informed KFF they count on state Medicaid spending to extend by 7% in fiscal 12 months 2025, whilst enrollment nationally falls by about 4%.
Not solely that, McEvoy mentioned Medicaid applications are drawing much less tax income and policymakers are prone to apply extra scrutiny on investments in Medicaid.
“I believe that may undoubtedly have an effect on whether or not applications can develop their service array, cowl folks at greater earnings tiers, or pursue innovation tasks,” McEvoy mentioned.
