Key facts
- 14% of U.S. employers plan to stop covering GLP-1 weight-loss drugs in 2027.
- Healthcare costs are projected to rise 9.2% in 2027 without cost-management changes.
- Two-thirds of employers noted increased usage of these drugs.
- Cancer is the leading condition driving healthcare spending for employers.
Approximately 14% of U.S. employers are planning to discontinue coverage for GLP-1 weight-loss drugs in 2027, driven by increasing healthcare costs, according to a survey by the Business Group on Health. Without changes to manage expenses, overall healthcare costs for employers are projected to rise by 9.2% in 2027, up from 8.5% in 2026.
The survey revealed that two-thirds of employers have observed a rise in the utilization of these drugs, which mimic hormones to promote fullness. The list prices for these medications are substantial, with Zepbound costing $499 per month and Wegovy $1,349.02 per month.
Ellen Kelsay, president of the Business Group on Health, stated that this situation presents a challenge for employers in budgeting and forecasting, urging a more disruptive approach to healthcare delivery. She noted that rising hospital and pharmacy costs, along with policy changes, are contributing factors to increased employer spending.
In response to cost pressures, employers are exploring strategies such as encouraging the use of cheaper biosimilars, dropping coverage for complex specialty drugs, and seeking alternative pharmacy arrangements. Pharmacy costs currently account for 25% of employers' healthcare spending and are expected to increase by 12% in 2027.
The proportion of employers covering GLP-1 weight-loss drugs is anticipated to decrease from 72% in 2025 to 60% in 2026. The survey included employers ranging in size from fewer than 5,000 to over 100,000 employees.
Beyond weight-loss drugs, cancer was identified as the primary driver of healthcare spending for 70% of firms, an increase from 58% in the previous year. Musculoskeletal and cardiovascular conditions were also cited as significant cost drivers, often involving complex therapies.