A proposed deal by the Trump administration to lower prices on weight-loss drugs for state Medicaid programs has been rejected by most participating states due to concerns over cost and legislative hurdles. Some states are still evaluating the proposal, while others already have existing coverage or state laws prohibiting such coverage.
The widespread rejection of the Trump administration's proposed drug pricing model highlights the complex financial and legislative challenges states face in covering expensive new medications, potentially impacting access to weight-loss treatments for millions of Medicaid beneficiaries.
The Trump administration proposed a model aimed at reducing the cost of weight-loss drugs for state Medicaid programs, but the initiative has faced widespread rejection from states. Many states, including Florida, Oregon, Hawaii, and Vermont, have declined to participate, citing the need for new, non-budgeted spending, legislative appropriations, and significant additional investment. North Dakota lawmakers previously rejected a plan to cover anti-obesity medications, leading to its opt-out. New Mexico found the model "not currently feasible" due to financial pressures from new legislation. Furthermore, existing state laws in New Jersey and Kentucky prohibit Medicaid coverage of weight-loss drugs.
Johanna Butler, director of health care costs at The National Academy for State Health Policy, noted that states must be mindful of public dollars, and the unclear accrual of savings can complicate the case for coverage. Some states, like Michigan, which already covers GLP-1s, have applied to participate and are in discussions with CMS to potentially expand coverage to more patients with obesity and related comorbidities by January 1. Virginia and Tennessee are still evaluating the proposal. However, states such as Minnesota and Missouri, which already cover these medications, have chosen not to join the Trump administration's model, possibly because they believe they can negotiate better terms directly with drugmakers.