MW Health insurers raise questions about Medicare program that will offer GLP-1s to seniors for $50
By Jaimy Lee
CVS reportedly isn't participating in the program, and UnitedHealth says there are 'notable challenges'
CVS Health reportedly won't participate in a new program to provide Medicare beneficiaries with GLP-1 medications for weight loss.
Some health insurers are pushing back against a new program that will allow Medicare beneficiaries to pay $50 per month for GLP-1 medications for weight loss.
CVS Health $(CVS)$ told Bloomberg that it won't participate in the program. A spokesperson for the heath insurer did not immediately respond to requests from MarketWatch for comment. A UnitedHealth Group $(UNH)$ executive described "notable challenges and outstanding questions" around the program on that company's earnings call Tuesday morning.
"We're still working through that process internally," said Bobby Hunter, CEO of UnitedHealthcare's government programs, "and we look forward to continuing the dialog with CMS."
As part of its Balance program, the Centers for Medicare & Medicaid Services negotiated the prices of several GLP-1s for Medicaid agencies and insurers that offer Medicare Part D plans, aiming to give people with Medicare coverage access to weight-loss medications for the first time since the 1990s. The negotiations were carried out with the drugmakers, but the program is dependent on participation from health plans that cover 80% of Part D beneficiaries. The long-awaited program is set to begin in 2027, although a six-month Bridge version kicks off July 1.
"With CVS out and UNH non-committal beyond Bridge, the math becomes difficult," RBC Capital Markets analyst Trung Huynh wrote in a note.
Shares of Eli Lilly and Novo Nordisk - the category's leaders - both fell on Tuesday afternoon after the Bloomberg report came out and UnitedHealth's earnings call wrapped up. Lilly's stock $(LLY)$ was down 2%, while Novo Nordisk's U.S.-listed shares (NVO) (DK:NOVO.B) dropped 3.6%.
"The move in Lilly and Novo shares could be overdone," BMO Capital Markets analyst Evan David Seigerman told investors. "Nothing in UNH's response suggested a retreat from GLP-1 coverage or an unwillingness to engage in outcomes-based reimbursement more broadly."
The ability to sell GLP-1 medications to Medicare beneficiaries is key to growth for both companies. About 48% of people covered by Medicare are obese, while 38% of Americans on Medicaid and the Children's Health Insurance Program have a body mass index of 30 or higher.
"Medicare is a group of people that we would love to provide GLP-1 products to," Novo CEO Mike Doustdar told investors in February.
Similarly, Lilly is also "very, very positive about the opportunity to bring anti-obesity medications to patients in Medicare," according to remarks made by Lilly CFO Lucas Montarce on an earnings call in February.
"There is a bolus of patients that we have nowadays in Lilly's direct business that we believe are also Medicare patients," Montarce said, referring to LillyDirect, the company's portal for patients paying cash for their medications. "Expect that bolus - I think it's between 10% to 20% - [to] actually move into the Medicare space."
-Jaimy Lee
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April 21, 2026 13:55 ET (17:55 GMT)
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