Trump pulls back Biden's plan to cover weight loss drugs

Jessie Hellmann, CQ-Roll Call on Apr 4, 2025

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WASHINGTON — The Trump administration will not finalize a Biden-era plan to require coverage of anti-obesity medications in Medicare and Medicaid.

In a rule finalized Friday afternoon, the Centers for Medicare and Medicaid Services stated it does not intend to continue with the Biden proposal, which was released in November.

CMS did not provide a reason for dropping the proposal, but a spokesperson said finalizing the coverage is “not appropriate at this time.”

“CMS may consider future policy options for (anti-obesity medications) pending further review of both the potential benefits of these drugs including updated clinical indications, and relevant costs including fiscal impacts on stakeholders such as state Medicaid agencies,” the spokesperson said.

Budget hawks and some health plans had warned about the cost to the Medicare and Medicaid programs.

“While these drugs offer hope for many, the excessive costs carry enormous consequences for consumers, taxpayers and employers,” said Ceci Connolly, president and CEO of the Alliance of Community Health Plans, in a statement Friday.

Requiring coverage of the drugs, she said, “would have been irresponsible without further long-term efficacy and safety studies and economic analysis.”

While Wegovy and Ozempic, popular drugs used to treat diabetes and for weight loss, were among 15 drugs picked by the Biden administration for the second year of its Medicare price negotiation program, any negotiated prices wouldn’t take effect until 2027.

The Trump administration has indicated it intends to complete those negotiations.

At the non-negotiated price, Medicare coverage of anti-obesity drugs could cost nearly $25 billion over 10 years, according to an HHS estimate issued under Biden.

Currently, Medicare covers the drugs for beneficiaries diagnosed with diabetes or cardiovascular disease who are also classified as overweight or obese.

The Biden administration had interpreted the Medicare statute to cover the drugs not as weight loss drugs but as drugs to manage the chronic condition of obesity.

All state Medicaid programs cover the drugs for patients with diabetes, but only about a quarter cover the drug for weight management.

Coverage of the drugs are already straining state Medicaid budgets; Medicaid gross spending on 12 diabetes and weight loss drugs increased from $1.5 billion in 2019 to $9.4 billion in 2023 — an increase of 540%, according to a Health and Human Services Office of Inspector General report issued in December.

Health and Human Services Secretary Robert F. Kennedy Jr. has been critical of the drugs, instead placing a focus on lifestyle changes to lose weight.

But recently confirmed CMS Administrator Mehmet Oz has said he sees the benefit.

“In general, I think the amount of good done by these medications by helping people lose weight and improve their cardiovascular system — and it might have long-term benefits in a lot of other areas as well where obesity causes inflammation — is massive,” Oz said in an Instagram reel in August 2023.