Prescription drugs known as GLP-1 agonists—including Ozempic and Wegovy—have reshaped treatment for diabetes and obesity by offering a novel mechanism that regulates blood sugar and suppresses appetite. These medications mimic the action of glucagon-like peptide-1, a hormone that stimulates insulin secretion while slowing gastric emptying, which contributes to prolonged feelings of fullness.
Spending jumps while patients pay less
Researchers at Northwestern University analyzed data from nearly 1,500 adults who reported taking GLP-1 medications between 2017 and 2022, drawing from the Medical Expenditure Panel Survey (MEPS), a nationally representative dataset that tracks healthcare utilization and costs. The sample was weighted to reflect an estimated 20 million U.S. adults, providing a full snapshot of real-world prescribing patterns. The study’s methodology went beyond conventional cost analyses by capturing total payments, which included not only patient out-of-pocket expenses but also contributions from private insurers, employers, Medicare, Medicaid, and other government-funded health programs. This approach revealed the full economic burden of GLP-1 agonists, rather than isolating individual financial responsibility.
The surge in GLP-1 use among adults without diabetes—rising 643% over the five-year period—reflects a broader shift in treatment approaches. Wegovy’s 2021 approval for weight management contributed to this growth. Among those with diabetes, the 230% increase in GLP-1 use shows the drugs’ expanding role in glycemic control. The disparity in growth rates between the two groups highlights how the approval of weight-loss indications accelerated demand.
As utilization climbed, so did total spending, with average payments per patient rising 157% for adults without diabetes and 36% for those with the condition. The steeper increase in the non-diabetic group aligns with the higher cost of Wegovy compared to Ozempic, as well as the longer duration of therapy often required for weight management. Notably, patient out-of-pocket costs did not follow the same upward trajectory. Instead, they declined by 26% for those without diabetes and 39% for those with it, suggesting that insurers and public programs absorbed a growing share of the financial burden. This shift may reflect changes in insurance coverage policies, though the reduction in direct patient costs does not eliminate the broader economic impact, as the expenses are merely redistributed across the healthcare system.
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Michael Hammond, MD, the study’s lead author, emphasized that the cost shift has systemic implications. “Higher total costs of GLP-1 drugs might drive up taxes and increase insurance premium payments both for people taking GLP-1s and those not,” he said. This redistribution means that individuals who do not use these medications may still experience financial consequences through raised insurance premiums or tax-funded healthcare expenditures.
Who bears the burden?
The study period concluded in 2022, capturing a moment before the most recent surge in GLP-1 prescriptions. Medicare and Medicaid spending on these medications has continued to rise, and Medicare recently introduced a temporary program allowing many eligible beneficiaries to obtain GLP-1 medications for a flat monthly payment. While this initiative improves affordability for individual patients, it also shifts more of the financial responsibility onto the Medicare program.
Xiaoning Huang, MD, MPH, the study’s senior author, noted that the financial impact of GLP-1 agonists extends beyond the pharmacy counter. Higher spending on these drugs can lead to a cascade of economic adjustments, including increased insurance premiums for all policyholders, greater taxpayer-funded government expenditures, or stricter coverage policies designed to limit access. The researchers were careful to frame their findings as a call for policy solutions rather than a critique of GLP-1 agonists themselves. The drugs have demonstrated significant clinical benefits, but the study highlights the need for systemic changes to ensure that these benefits are accessible without imposing unsustainable financial strain on the healthcare system.
The study was published in the Journal of the American Heart Association.
