North Carolina, burdened by Wegovi costs, will stop paying for obesity drugs

North Carolina, burdened by Wegovi costs, will stop paying for obesity drugs

In June 2021, the insurance plan for North Carolina state employees was being paid for 2,800 people Taking weight loss medications.

Last year, it paid around Rs 25,000. The cost of drugs like Wegovi is covered by the North Carolina state health plan. $100 million Last year, spending on prescription drugs suddenly increased by 10 percent.

“This is something we never expected,” said State Treasurer Dale Folwell, whose office runs the health plan.

Concerned about rising costs, the health plan’s governing board voted Thursday To end all coverage Wegovi is also included in the list of drugs for weight loss, which account for a large part of the expenditure on obesity drugs. The scheme will continue to cover editions of medicines for people with diabetes.

Over the past few years, appetite suppressant medications have increased in popularity because they are exceptionally effective in helping patients lose weight. Research shows that the drugs may pay for themselves or even save money in the long run by preventing heart attacks and strokes, which lead to huge hospital bills.

But for employers and health plans that cover most of the cost of prescription drugs, the bill for these drugs is steep — and coming due now. in recent months, University System of Texas and hospital chain ascension has stopped paying for medicines for its employees. Those that continue to cover drugs are imposing new restrictions to cut costs. For example, Mayo Clinic will now only offer lifetime benefits. $20,000 For medicines for its employees.

By comparison, Medicare does not cover prescription drugs for weight loss, but does cover weight loss surgery.

In North Carolina, Thursday’s vote to end coverage appeared to be the first in the country by a state health plan. The plan uses state funds to pay most prescription drug costs for 740,000 public employees, teachers, retirees and their family members.

The state health scheme is in financial crisis. Its cash position declined by $250 million last year. The trustees who voted to end the coverage said they have a duty to do what is best for the most people.

“As fiduciaries we have a responsibility to the state health plan,” said Trustee Rusty Duke. “It’s a small number of people we’re talking about relative to all the members.”

Coverage of drugs for weight loss will end on April 1 unless a final agreement is reached to reduce costs.

Patients must pay out of pocket to continue taking weight loss medications. Without insurance coverage the cost of the drugs can exceed $16,000 a year – a daunting prospect for workers whose average annual salary is $56,000, Most patients regain the weight they lost if they stop taking the medications.

In recent weeks, state health plan officials explored whether they could cut costs by placing restrictions on who could get the drugs, but they were told they could get $54 million in rebates this year from drug makers. Can’t do this without losing.

Jessica Uhrich-Rieger, a 44-year-old state employee, started taking Wegovi in ​​October 2022. She has since lost 103 pounds and no longer has pre-diabetes. But she won’t be able to afford Wegovi’s sticker price of $1,349 a month.

“It’s more than my mortgage,” he said.

Mr. Folwell, chairman of the health plan’s governing board, who did not vote Thursday, has been vocal about the plan’s unsustainable spending on weight-loss drugs. (In addition to his day job, he is running as a Republican for Governor of North Carolina on a substance-over-style policy platform.)

He talks about the dilemma facing health plans in easy-to-understand terms: For example, if the plan had covered prescription drugs without any limits this year, the cost an individual would have to pay for. Would have been enough. 0.5 percent salary increase For all state employees. and he has sharply criticized Novo Nordisk, maker of Wegovi, is facing what it calls a price increase. The plan is costing Wegovi about $800 per patient per month, with patients responsible for an average $37 monthly co-payment.

“I’m not questioning its efficacy,” he said. “I’m questioning what we’re being accused of.”

Novo Nordisk spokeswoman Allison Schneider called the trustees’ decision to end coverage “irresponsible,” adding that the company was working with state health plan officials to address concerns about costs. “We do not support insurers or bureaucrats inserting their judgment into Medicare-based decisions,” he said.

Some in North Carolina see a bitter irony in the fact that Novo Nordisk manufactures and packages Wegovi in ​​Clayton, N.C. — just a stone’s throw from the government offices where state health plan officials try to figure out whether the drug will work. How to pay for.

Critics of the company have drawn attention to the millions of dollars in incentives that Novo Nordisk has received from the state as well as the counties where its plants are located.

“It certainly adds insult to injury,” said Ardis Watkins, executive director of the State Employees Association of North Carolina, a group that lobbies on behalf of state health plan members. “Our economic climate, which has been made so attractive to businesses here, is being used to manufacture a drug that is wildly marked up.”

Ms. Schneider said Novo Nordisk employs more than 2,500 North Carolinians and has made more than $5 billion in capital spending in the state.

State health plan staff are closely monitoring the increase in Wegovee spending. About a year ago, it became the health plan’s most expensive drug, overtaking the plan’s longtime top expense, the blockbuster anti-inflammatory drug Humira.

“Vegovi was suddenly starting to loosen up,” said Sonya Dunn, a health plan manager who regularly reviews reports that show the plan’s prescription drug spending hitting new highs.

The North Carolina state health plan has been more lax than other employers and insurance programs in covering obesity medications. Until recently, patients could get coverage without providing documentation that they had a body mass index or certain medical conditions approved by the Food and Drug Administration for eligibility for drugs.

Plan employees pay monthly premiums ranging from $25 for an individual to $720 for a family. The plan has not increased premiums for members for seven years — a priority, Mr. Folwell said, of recruiting young workers to join and remain in state government. If coverage of weight-loss drugs continued without limits, health plan officials estimated that premiums would increase by $50 a month next year.

Meghan Ray, a state employee who took Wegovi, said she was disappointed by the trustees’ vote. He started Wegovi two years ago because of a medical condition that could jeopardize his eyesight if he gained too much weight. Since then, she has lost 32 pounds and stopped taking blood pressure medication.

Ms Ray, 41, who spoke at the board meeting on Thursday, said she feared she would eventually have to undergo another tummy tuck surgery which would be costly to the state health plan because she would have no money to pay out of pocket. There is no money for. For Wegovi.

“The state doesn’t pay me well enough for me to afford it,” he said in an interview. “It’s even more important than whether I can afford gas to go to work, or food to feed my family.”

The board voted by a narrow margin of 4 to 3 to end coverage of the drugs.

Wayne Fish, a trustee who voted against ending coverage, is himself a state employee, working in food service in corrections. He said he was distressed about the agreement.

“These are difficult decisions,” he said. “We look at the solvency of the scheme etc., but these are also people’s lives. I don’t know if there’s any way to balance it.”

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