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Insurance giant Cigna has announced plans to broaden insurance coverage for weight loss drugs. The company has struck agreements with pharmaceutical companies Eli Lilly & Co. and Novo Nordisk A/S to limit the annual spending increase on these treatments.

According to CNBC, the move by Cigna comes at a time when many insurers are considering dropping coverage for weight loss drugs due to their high costs. Despite their pricey list prices of up to $1,000 per month or $15,000 per year, these drugs have seen high demand among Americans.

Cigna's Move to Expand Weight Loss Drug Coverage

Under the new agreements, Cigna's pharmacy benefits management unit aims to cap spending increases for weight loss and diabetes drugs at a maximum of 15% annually. Currently, some health plans are experiencing spending increases of up to 50% annually on these drugs.

Cigna's initiative could make weight loss treatments more accessible to needy people. While most insurance plans cover diabetes treatments, coverage for weight loss drugs has been limited.

However, an October survey revealed that 76% of companies provided coverage for diabetes drugs, while only 27% covered weight loss drugs, with 13% considering coverage for weight loss in the future.

What's Next?

Adam Kautzner, president of Cigna's Express Scripts pharmacy benefit manager unit, predicts that the market for GLP-1 drugs, which treat both diabetes and obesity, could reach $100 billion by the end of the decade. He emphasized the need for sustainable spending in this area.

"Our industry-first financial guarantee offers employers and health plans greater predictability and control of their GLP-1 spend," Adam Kautzner said.

To address the rising costs, Cigna has expanded its EncircleRx program, which targets patients with diabetes, obesity, and cardiovascular disease. This program includes support services to aid patients in managing their conditions alongside medication.

Express Scripts, Cigna's prescription benefits provider, serves approximately 120 million people on commercial or government health plans. The company's unique agreements with Eli Lilly & Co. and Novo Nordisk A/S aim to provide financial guarantees to clients, ensuring predictable spending on these medications.

Despite the efforts to expand coverage, some states, like North Carolina, have stopped covering weight loss drugs for state employees due to the increasing costs associated with these treatments.

In addition to its commitment to expanding coverage for weight loss drugs, Cigna has raised its target for long-term average annual adjusted earnings per share growth, reflecting its dedication to providing quality healthcare services to its clients.