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Could Pricey GLP-1 Drugs Cut Healthcare Costs? The Math Isn’t Simple

Greater weight loss was linked to greater savings, which may be directionally correct but isn’t necessarily the whole story.

In adults with overweight or obesity, losing as little as 5% of bodyweight could translate into a savings of about 8% in annual healthcare expenses, or about $670 per year, a cross-sectional study suggests.

The savings were similar regardless of whether individuals had employer-sponsored insurance or Medicare, and increased with greater percentage of bodyweight lost.

The money saved was estimated to come from changes in body mass index (BMI).For each percentage-point increase in BMI over 30, there was an average increase in annual healthcare spending of $326 (P= 0.006), with differences seen by race and ethnicity.

These data, published December 5, 2024, in JAMA Network Open, come at a time when patients, clinicians, healthcare policy experts, and insurers are wrestling with the high cost of glucagon-like peptide-1 (GLP-1) receptor agonists for weight loss as well as the vast numbers of people who stand to benefit from them.

“What an insurer is interested in is the per capita spending to manage a patient who's overweight or obese. Certainly there's variation around that, as you can see in the analysis, but the important part is the overall savings,” Kenneth E. Thorpe, PhD (Emory University, Atlanta, GA), the study’s lead author, told TCTMD.

A reduction in weight of 25% was estimated to save $2,849 per year, with reductions in annual spending seen across numerous chronic disease conditions. The largest reductions in total healthcare spending by BMI lowering were projected for individuals with diabetes and arthritis. In those with hypertension, losing 15% bodyweight was estimated to reduce healthcare spending by $1,112 per year versus a reduction of $4,950 per year for the same weight loss in those with arthritis.

But Dhruv Kazi, MD (Beth Israel Deaconess Medical Center/Harvard Medical School, Boston, MA), was part of a group that published aresearch letterlast month showing that more than half of all adults in the United States are eligible to receive semaglutide for weight loss, diabetes, or prevention of recurrent CV events. He urged caution in interpreting the current analysis.

“The potential budget impact of getting one in two US adults on these therapies is enormous,” he told TCTMD. “There will be downstream cost reductions, say from fewer heart attacks, but these cannot be estimated from a cross-sectional analysis. What the paper finds is people at lower weight have lower costs, meaning there's no dynamic weight loss component in the analysis at all. If someone who is 10 pounds overweight has higher healthcare costs, that counterintuitively, does not mean that losing 10 pounds lowers their costs immediately because there may be other reasons why people are overweight and also other drivers of costs.”

Those issues aside, Kazi said he thinks the analysis is directionally correct.

“It is fair to say that people who are living with overweight and obesity have higher healthcare costs, and that the relationship between weight and healthcare costs is not linear, meaning people who have extremely high levels of overweight or obesity have large increases in healthcare costs resulting from the large increases in the burden of clinical comorbidities,” he added.

More Projected Savings Forecasted

For the analysis, Thorpe and coauthor Peter J. Joski, MSPH (Emory University), looked at deidentified survey data from 13,435 adults with employer-sponsored insurance (mean age 46 years; 47.6% female; 11% Black) and 3,774 adults with Medicare (mean age 63 years; 50% female; 17% Black). All had a BMI of 25 or higher. Data from the Medical Expenditure Panel Survey–Household Component were used to calculate total annual healthcare spending.

Depending on how much weight people had to lose, the potential to decrease healthcare spending varied. For an adult with a baseline BMI of 30, losing 5% of their bodyweight was projected to lower annual healthcare spending by $441. The same 5% loss in someone with a starting BMI of 45 could save more than $1,400 annually.

Even if we were to bring down the cost of these drugs substantially, they would not be cost-saving. Dhruv Kazi

In an accompanying editorial, a government health policy analyst notes that the study makes several assumptions to connect changes in BMI to healthcare spending. For instance, there are “no unobserved differences between people with different BMIs that are positively associated with spending, which would persist even after adults with obesity lose weight,” writes Noelia Duchovny, PhD (Congressional Budget Office, Washington, DC). “The second assumption is that the cumulative health effects of obesity can be fully reversed through weight loss.”

She suggests that an RCT that compares changes in spending over time for people with overweight and obesity might be the best way to directly assess the impact of weight loss on cost. Barring that, Duchovny says there are other options that could supplement the work of Thorpe and Joski, including microsimulation studies that estimate how changes in weight for a given sample of people affect the prevalence and severity of various weight-related conditions and how that translates into changes in cost.

Thorpe disagreed, saying others have carried out similar research with microsimulation models and shown results similar to his analysis.

Future Considerations

According to Thorpe, while analyses like these can help payers forecast how the new weight-loss medications could be viewed from a cost-savings perspective, they also can be used to optimize prescribing strategies. Examples are coupling GLP-1 agents with plans like the Diabetes Prevention Program (DPP), a lifestyle modification strategy, and making it easier for people to enroll in DPP or programs like it, thus increasing the opportunity for support and guidance in using the medications.

Ultimately, Thorpe said the reduction in the cost of the drugs themselves over the coming years is projected to improve the situation even more. He made an analogy to medications for hepatitis C, which started out pricy and eventually became affordable for anyone who needed them.

“[GLP-1s] are one of the most important innovations in medicine in several decades,” he said. “In the Medicare program, over 95% of the spending is linked to chronically ill patients, most of whom are overweight or obese. So, if you're real serious about saving Medicare money, this is the area to look at.”

Importantly, the US Centers for Medicare & Medicaid Servicesannounced last monththat they were proposing changes that would allow GLP-1 receptor agonists to be a covered benefit for Medicare patients for the treatment of obesity.

Kazi agreed that GLP-1 drugs could be transformative for population health if used correctly, but argued that the cost-saving arguments are overblown and may not be appropriate in this context.

“Even if we were to bring down the cost of these drugs substantially, they would not be cost-saving. But the purpose of healthcare isn’t to save money. We think of healthcare as something that is helping people lead healthy lives along with their own goals and ambitions, and that's what these drugs are going to help people do,” he said. “All the evidence right now suggests that these therapies are therapies for life; that the moment you stop them, you regain at least 70% of the lost weight in the first year. So, it's not a one-and-done therapy, it's not a short-course therapy like in hepatitis C. The expectation is that you will be on these therapies for life. And those costs add up. But lowering the drug price may make them cost-effective, meaning that they could represent good value for money.”

There is reason to be hopeful, however, since the Inflation Reduction Act could help move prices for patients on Medicare, Kazi said. The other glimmer of hope is that as newer injectable weight-loss formulations like the highly anticipatedretatrutide(Eli Lilly and Company) hit the market, prices are expected to come down.

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