Medicare’s recent move to cover the weight loss drug Wegoby for some beneficiaries at risk for heart disease could raise monthly premiums for many of the 65 million adults enrolled in the federal health insurance program. Experts warn that it is possible.

It is still unclear how much the price will increase. Premium increases depend on how many millions of people qualify for the popular drug, which costs about $1,300 a month.

At least one health policy expert says premiums could rise as early as 2025, but more likely in 2026 or later.

“We’re very concerned, both in terms of rising premiums and Medicare funding over the next 10 years,” said Lawrence Gostin, director of Georgetown University’s O’Neill National Institute for Global Health Law. “We think this drug could have significant lifelong costs because it needs to be taken for the rest of your life to be effective.”

The drug is covered by Medicare Part D, which pays for prescription drugs people take at home, according to the Centers for Medicare and Medicaid Services. More than 50 million people with Medicare enrolled in Part D plans last year, according to KFF, a nonpartisan group that studies health policy issues.

According to CMS, Medicare Part D enrollees are paying an average of $55.50 per month in premiums this year. When a patient encounters a so-called coverage gap, he is forced to pay 25% out of pocket until the patient pays a certain amount out of pocket, which varies by plan. Part D plans are offered by private insurance companies that contract with the U.S. government.

Some Part D providers, including CVS Health and Kaiser Permanente, have already announced that they will begin using Wegovy for patients at risk for heart disease. All major insurance companies have been contacted for comment.

Under CMS guidelines, Wegovy can only be prescribed to heart patients who are overweight or obese. Medicare will not pay for his Wegovy if it is only used for weight loss.

It is not yet clear how many people on Medicare meet these criteria. Juliette Cubansky, associate director of KFF’s Medicare policy program, estimated that number is likely “in the millions.”

“As costs increase, federal contributions increase and, generally speaking, premiums for beneficiaries increase,” she said.

Geoffrey Davis, director of health policy at McDermott & Consulting, a group that provides data analysis and policy advice to the health industry, said monthly premium increases related to Wegobee are unlikely to occur within the next year. .

That’s because private insurers that offer Part D coverage have already begun pegging their payment rates to Medicare for the 2025 enrollment year, he said.

However, he said the insurer could continue to raise premiums next year if initial estimates of Wegobee’s costs exceed expectations.

Total Medicare spending for the diabetes drug Ozempic, which shares the same active ingredient as Wigovy, will increase from $2.6 billion in 2021 to $4.6 billion in 2022, according to an analysis published last month by KFF, which will make the Medicare sector 6. It became the best-selling drug. D that year. Medicare began covering Ozempic in 2018.

However, Davis added that any premium increases caused by Wegovy are much more likely to occur as early as the 2026 enrollment year.

“This drug is expensive,” Davis says. “If millions of people become insured, premiums could rise in the future.”

Cubanski said even a few dollar increase in premiums can be a big problem for Medicare enrollees, who are often retired and have limited incomes.

Barriers to coverage

It is important to note that Medicare allows insurance companies offering Part D coverage to enact rules before covering Wegovy, but this may limit access in the short term. , could keep premiums lower, said Gretchen Jacobson, the association’s vice president for Medicare programs. Commonwealth Fund.

Those rules include step therapy, which requires patients to try a lower-cost drug before being allowed to try a more expensive one, Gretchen said.

For example, some private insurance companies may start patients on older weight-loss drugs before allowing them to prescribe GLP-1 drugs.

Insurance companies can also request Medicare Part D patients must obtain prior authorization from their insurance company before receiving any medication.

Dr. Amit Khera, a fellow at the American Heart Association, said prior authorization is common with other expensive heart drugs and requires medical professionals to regularly submit medical records and tests showing they meet the requirements. He said it is often a cumbersome process for both providers and patients. For drugs.

“I think the goal is to make sure we get the right drug to the right patient, but in reality it just becomes a very cumbersome process that can limit access in some ways.” Kela says.

cost limitations

Insurers have a bad reputation for restricting patient access, but Novo Nordisk may have to share responsibility for high costs, Gostin said.

He’s not the only one who thinks so. Last month, Sen. Bernie Sanders (R-Vt.), chairman of the Health, Education, Labor and Pensions Committee, called on drug companies to lower drug prices.

He found that Ozempic and Wigovy could cost less than $5 per month to manufacture, even though Novo Nordisk has priced Wegovy’s active ingredient, semaglutide, at $1,000 per month in the US. It cited a study by researchers at Yale University.

“I think Bernie Sanders is right to ask us to do that, especially when selling to people on Medicare,” Gostin said.

Even if Novo Nordisk doesn’t lower its prices, Cubanski said semaglutide could become subject to Medicare price negotiations under the Inflation Control Act as early as next year.

The negotiated price will not take effect until 2027.

Davis also said that insurers offering Part D coverage may negotiate better rebates (discounts drug companies give insurers in return for coverage), which reduce costs over a period of time. He said that there is a possibility that