For Medicare and Medicaid beneficiaries, the stakes are especially high. These programs cover more than 100 million Americans combined, many of whom live with obesity and related complications such as diabetes and heart disease. Obesity remains one of the most pressing health challenges in the United States, affecting more than 40% of adults and contributing to a wide spectrum of chronic conditions. In recent years, the advent of highly effective anti-obesity medications (AOMs), particularly the glucagon-like peptide-1 (GLP-1) receptor agonists, has transformed both clinical practice and public debate. Drugs such as semaglutide, marketed under brand names like Wegovy and Rybelsus, have shown not only substantial weight reduction but also significant improvements in cardiovascular outcomes. These findings have forced policymakers and insurers to reconsider long-standing restrictions on coverage.
Medicare has historically been prohibited from covering drugs “for weight loss,” a statutory barrier that excluded AOMs from Part D formularies despite strong clinical evidence of benefit. Medicaid, meanwhile, leaves coverage largely to state discretion, creating a patchwork system where access varies dramatically depending on geography.
The Regulatory & Legal Framework for Medicare/Medicaid Coverage of AOMs
Medicare has historically been prohibited from covering drugs “for weight loss,” a statutory barrier that excluded AOMs from Part D formularies despite strong clinical evidence of benefit. This prohibition stems from the Medicare Modernization Act of 2003, which explicitly excludes “agents used for weight loss” from Part D coverage.
The turning point came in 2024, when the FDA approved semaglutide (Wegovy) for reducing major cardiovascular events in adults with obesity or overweight and established cardiovascular disease. This reframed the drug not merely as a weight-management therapy but as a cardiometabolic intervention, a crucial distinction that allowed Medicare Part D plans to begin offering coverage.
In practice, Wegovy can now be reimbursed under Part D if prescribed for heart protection, but not for weight loss alone. The distinction is technical but decisive: coverage depends on the FDA label and physician documentation.
Medicaid tells a different story. Federal law requires coverage of FDA-approved drugs from participating manufacturers, yet states have significant latitude to set formularies and prior authorization rules. Most states historically declined to cover AOMs broadly, citing high prices and uncertain cost-effectiveness. With the new cardiovascular label, however, some states are beginning to open coverage, even though often with narrow criteria. Others continue to exclude them entirely, producing a patchwork where access depends heavily on where a patient lives.
Congressional action would be required to repeal the Medicare weight-loss exclusion outright. Proposals like the Treat and Reduce Obesity Act have been introduced repeatedly, but none have passed. Until such a law is enacted, the only path to Medicare coverage is through FDA label expansions that reposition anti-obesity medications as treatments for comorbid conditions.
The 2025–2026 CMS/Medicare Policy Landscape for Anti-Obesity Drugs
The years 2025 and 2026 mark a pivotal moment for Medicare’s relationship with anti-obesity medications, but the changes are narrower than many expected. Coverage is not being opened broadly; instead, it is confined to a new cardiovascular risk indication, shaped by both regulatory interpretation and political caution.
The most important development is Medicare Part D’s ability to cover semaglutide (Wegovy) for the purpose of reducing major adverse cardiovascular events in patients with obesity or overweight who also have established cardiovascular disease. This followed the FDA’s label expansion in 2024 and created the first crack in the statutory wall that excluded weight-loss drugs.
However, coverage is tightly circumscribed. Beneficiaries must meet the cardiovascular criteria, and prescribers must document the indication for the claim to be valid. This effectively means a Medicare patient with obesity but without cardiovascular disease cannot obtain coverage for Wegovy simply for weight management.
Part D plans are incorporating Wegovy into formularies, but access is not uniform. Plans may place it on higher tiers, subject it to prior authorization or step therapy. Early signals suggest that large insurers will add the drug but impose significant utilization management.
The financial implications are substantial. Wegovy’s list price exceeds $1,300 per month. Beneficiaries benefit from the Inflation Reduction Act’s $2,000 annual cap on out-of-pocket Part D spending (beginning in 2025), and the Prescription Drug Payment Plan allows costs to be spread across the year. Still, coinsurance and deductibles remain meaningful barriers for many on fixed incomes.
CMS has also made clear in 2025 that there will be no broader expansion of coverage in 2026. Drugs like Wegovy and other GLP-1 agonists will remain covered only when tied to FDA-approved non-obesity indications. This disappointed many clinicians and advocates who had hoped for broader change.
Medicaid continues to evolve state by state. Some states will follow Medicare’s lead, others may experiment with broader access, and many will continue to exclude coverage. The result is a landscape where progress and limitation coexist. Medicare has opened a door, but only slightly. Patients with obesity and cardiovascular disease may gain meaningful access, while millions remain excluded unless future FDA label expansions or legislative reforms broaden the pathway.
Projected Access, Utilization, and Cost Implications
The limited but meaningful changes to Medicare’s policy on anti-obesity drugs in 2025–2026 will directly affect how many beneficiaries can realistically obtain Wegovy or similar therapies, and at what cost.
The FDA label expansion for Wegovy specifies its use for reducing major adverse cardiovascular events in adults with obesity or overweight who already have established cardiovascular disease. This is not a small group. According to estimates from the Centers for Disease Control and Prevention, roughly 60% of older adults in the U.S. have obesity or overweight, and about one in three has cardiovascular disease.
However, the practical number will be lower. Patients must have documentation of established cardiovascular disease, not just risk factors such as hypertension or hyperlipidemia. Moreover, the new coverage applies only when physicians prescribe Wegovy specifically for cardiovascular protection. A patient seeking the drug primarily for weight loss, even if obese and at high risk, will still face denial.
This exclusion leaves out millions of beneficiaries who might benefit from weight reduction but lack documented cardiovascular disease.
Medicaid’s picture is more fragmented. In states that decide to align with Medicare’s cardiovascular indication, tens of thousands of low-income patients may gain access. In states that decline, patients will continue to face out-of-pocket costs exceeding $1,000 per month, effectively shutting them out.
Even when coverage exists, affordability remains a major obstacle. Wegovy’s list price is more than $16,000 annually. Beneficiaries under Part D face coinsurance and deductibles that, even with the $2,000 annual cap on out-of-pocket spending starting in 2025, can represent a heavy financial burden.
Policy Challenges, Risks, and Future Directions
The new Medicare coverage pathway for Wegovy represents progress, but it also exposes deeper challenges. The first is the tension between clinical need and fiscal responsibility. On one hand, obesity is a driver of enormous healthcare spending and human suffering; on the other, GLP-1 drugs carry price tags that could destabilize Medicare’s budget if widely adopted.
Patient affordability remains a stubborn barrier. Even with the $2,000 annual out-of-pocket cap under Part D, costs are significant, especially for low-income beneficiaries. Medicaid patients may fare better if states adopt comprehensive coverage, but the opposite is equally possible: some states may decline coverage entirely, widening disparities.
Another risk is discontinuity of coverage. Patients often move between commercial insurance, Medicaid, and Medicare over their lifetimes. Because the rules differ so drastically across programs, a beneficiary who begins treatment under one plan may lose access under another, interrupting care and undermining health outcomes.
The scientific landscape adds both promise and uncertainty. Clinical trials are ongoing for GLP-1s in conditions such as chronic kidney disease and heart failure. Positive results could generate new FDA label expansions, opening further coverage pathways within Medicare despite the statutory prohibition on weight-loss drugs.
Legislation remains the clearest path to comprehensive reform. Bills such as the Treat and Reduce Obesity Act would explicitly remove the prohibition on covering weight-loss medications, but Congress has repeatedly failed to pass them. Until lawmakers act, CMS will be constrained to incremental steps, relying on label expansions and regulatory adjustments.
Conclusion
The shift in Medicare policy for Wegovy signals a cautious but important change in how the U.S. approaches obesity treatment. For the first time, a GLP-1 is available to Medicare beneficiaries under a defined clinical indication, reflecting both the scientific evidence and the limits of current law. Coverage, however, remains restricted, tied only to cardiovascular protection and not to obesity itself.
Access will depend heavily on eligibility, plan design, and the ability of patients to manage cost-sharing. Medicaid, with its state-level discretion, will continue to produce a patchwork of coverage, leaving many low-income patients without consistent access.
Looking forward, the trajectory will be shaped by FDA label expansions, state decisions, and potential legislative reform. The central challenge will be balancing fiscal sustainability with equity and health benefit. The policy door is now ajar, but whether it opens wider in 2026 and beyond remains uncertain.
References
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Food and Drug Administration. (2024, March 8). FDA approves first treatment to reduce risk of serious heart problems in adults with obesity or overweight. U.S. Food and Drug Administration.
https://www.fda.gov/news-events/press-announcements -
National Center for Health Statistics. (2023). Obesity prevalence among adults and youth: United States, 2017–2020. Centers for Disease Control and Prevention.
https://www.cdc.gov/nchs -
Wadden, T. A., Bailey, T. S., Billings, L. K., Davies, M., Frias, J. P., Koroleva, A., & Rubino, D. (2021). Effect of subcutaneous semaglutide vs placebo as an adjunct to intensive behavioral therapy on body weight in adults with overweight or obesity: The STEP 3 randomized clinical trial. JAMA, 325(14), 1403–1413.
https://doi.org/10.1001/jama.2021.1831
