GLP-1 medications, originally developed to treat diabetes, have rapidly become one of the biggest disruptors in employee health benefits. As demand for these drugs—often used for weight loss—skyrockets, many employers are being forced to decide whether to cover them under their health plans. What was once a discretionary benefit may soon become an expected standard.
Large employers are already feeling the pressure. Many report that pharmacy costs have increased significantly due to GLP-1 prescriptions, yet dropping coverage altogether is becoming less of an option. Industry experts predict that within a year, most employer plans will be expected to include these medications for weight management, whether they want to or not.
For employers, especially small and midsize businesses, this creates a complex dilemma. On one hand, GLP-1 drugs can deliver meaningful health benefits—reducing weight, improving blood pressure, and potentially lowering long-term medical costs tied to chronic conditions. On the other hand, these medications are expensive, and covering them could sharply raise premium costs for both employers and employees.
Adding to the challenge, employees are increasingly aware of these drugs and are beginning to expect access to them as part of a modern benefits package. Employers who choose not to cover GLP-1s may risk appearing outdated or less competitive when recruiting and retaining talent.
Some organizations have tried to find a middle ground. Instead of unrestricted coverage, they’re setting eligibility requirements—such as requiring participants to complete a nutrition or lifestyle program alongside the prescription. Others are limiting coverage to individuals with certain medical conditions or higher health risks. These strategies can help manage costs while still offering access to employees who truly need the medication.
For small businesses, this issue is especially sensitive. With smaller risk pools, even one or two employees using high-cost medications can impact premiums substantially. However, completely avoiding coverage may not be a long-term solution if insurers begin to standardize GLP-1 coverage across all plans.
Ultimately, the question is shifting. It’s no longer just, “Should we cover GLP-1 drugs?” but rather, “How can we manage them responsibly?” Employers will need to balance the financial realities of their benefit budgets with the growing expectations of their workforce.
As the market evolves, the smartest move may be to plan ahead. Review your current benefits, talk with your broker, and begin evaluating how coverage of GLP-1 medications could fit into your broader health strategy. Whether you choose to cover them now or later, preparation will be key to staying competitive—and keeping your benefit costs under control.