On November 6, 2025, the Trump administration announced new pricing and coverage agreements with Eli Lilly and Novo Nordisk for widely used glucagon-like peptide-1 (GLP-1) receptor agonists, including tirzepatide (Mounjaro®, Zepbound®) and semaglutide (Ozempic®, Wegovy®). These agreements aim to lower out-of-pocket costs for some patients and expand access under federal health programs beginning in 2026.
Key Pricing and Coverage Changes
Under the announced agreements:
- Cash-pay patients using direct-to-consumer platforms are expected to pay approximately $350 per month for injectable GLP-1 medications starting in January 2026, down from current prices of roughly $500 per month. These lower prices apply to starter doses only.
- Medicare would receive a negotiated price of $245 per month for injectable GLP-1 agents for currently covered indications, such as diabetes, chronic kidney disease, and sleep apnea, as well as newly expanded indications related to obesity and associated conditions.
- Medicare beneficiaries would have copayments capped at $50 per month across all covered indications.
- Medicaid programs will have the option to adopt the same negotiated pricing, though implementation timelines remain unclear.
According to company statements, lower copayments and expanded coverage—particularly for obesity-related indications—could take effect sometime in 2026. However, these changes may be operationally complex for Medicare Part D plans, as 2026 plan bids were finalized before the agreements were announced.
Limited Impact on Commercial Insurance
Notably, the agreements do not include pricing concessions for commercially insured patients. Manufacturers have indicated that negotiated prices apply only within federal programs. As a result, employers and private insurers may continue to limit coverage of GLP-1 medications for weight-loss indications, especially given their substantial budget impact.
Recent data show that coverage for GLP-1 drugs used for weight loss remains inconsistent:
- Only a small number of state employee and individual market plans currently offer coverage.
- Employer-sponsored coverage varies widely, with larger employers more likely to cover these medications than small firms.
- Many plans report moderate to significant increases in prescription drug spending related to GLP-1 use.
As lower-priced cash-pay options become more available, some employers may further reduce coverage, potentially creating access challenges for lower-income individuals who cannot afford even reduced out-of-pocket costs.
Medicare, Medicaid, and Policy Context
Historically, Medicare has excluded coverage of medications used solely for weight loss, and Medicaid programs have had broad discretion to limit or deny coverage. While recent federal proposals have explored expanding coverage for obesity treatment, such changes carry significant fiscal implications.
The Congressional Budget Office previously estimated that expanding Medicare coverage of GLP-1 drugs for obesity could increase federal spending by tens of billions of dollars over a decade. The long-term budgetary impact of the newly announced agreements will depend on final pricing, utilization rates, and eligibility criteria.
In addition to pricing concessions, manufacturers received regulatory and trade-related benefits, including relief from potential tariffs and expedited review incentives from the U.S. Food and Drug Administration.
What This Means for Physicians and Patients
These agreements have the potential to:
- Improve affordability and access to GLP-1 therapies for Medicare and some Medicaid beneficiaries
- Increase utilization of GLP-1 drugs for obesity and related conditions
- Raise important questions about long-term health care spending, equity, and sustainability
As implementation details emerge, it will be important for clinicians, health systems, and policymakers to closely monitor the effects of these changes on patient outcomes, payer budgets, and access across different populations.
ATLMed will continue to follow developments related to GLP-1 therapies and federal health policy and provide updates relevant to our physician community.
